Fireside Chat: Supply Chain Disruption
Our ninth Fireside Chat focused on how Covid-19 has impacted on the global food supply chain. Previous chats have highlighted how the pandemic has exposed the vulnerabilities of many organisations and how the most vulnerable has been most impacted. Hubs including China, Europe and the US have especially been affected: industrial production in China has fallen by 13.5% in January and February combined, compared with the previous year.
Nicola Ledsham, Senior Consultant at SustainAbility, led the discussion providing an overview of the challenges facing the global food supply chain which have become exasperated by the pandemic. She explained that the supply chain had coped quite well and we’d not seen major issues around security and associated price rises. But the centralised ‘just in time’ model was likely to be unsustainable going forward. We’ve see increasing food waste and labour shortages in the horticultural sector. In addition, seed shortages could lead to reduced supplies, and in a world where global trade is estimated to fall by 27%, many countries have already set up export restrictions. These in turn are likely to lead to food shortages, increased prices and ultimately food poverty. The World Food Programme has predicted that the lives and livelihoods of 265 million people in low and middle-income countries will be under severe threat unless swift action is taken to tackle the pandemic.
Looking to the future resilience and innovation will be key to addressing this challenge.
Responsible businesses have responded in the short term by fulfilling their contracts, regardless of whether the product has been used. In order to build in future resilience we need further diversification of the supply chain with business supporting small holder farmers to be more sustainable. More collaboration and a push to redress anti-competition laws will support this. We’ve seen an expansion of regional supply chains, local schemes and direct sales to customers which may continue but the reliance on global supply chains is expected to continue.
The increased use of food banks in the U.K. presents a challenge for government and business who need to work together to develop a second tier market for surplus food. We’ve seen some innovative developments in food preservation and packaging to extend the life of products and the use of AI, but much more needs to be done.
There’s no doubt that Covid could force many companies, and indeed entire industries, to rethink and transform their global supply chain model to build in resilience.
If you have thoughts on how the ICRS can support you, please email email@example.com. We’re encouraging our members to share examples of how they’re responding to the pandemic so be sure that you’re also a member of our members-only LinkedIn Group, The Exchange Online.
Links for local and regional agricultural employment:
Pick for Britain: https://pickforbritain.org.uk/
British Apples and Pears: https://britishapplesandpears.co.uk/job/
The Farmers Army: http://www.thefarmersarmy.co.uk/