Covid-19 offers chance to build more resilient food systems
Global agri-food supply chains have so far been resilient in responding to the difficulties posed by the coronavirus, although certain logistical challenges persist. Improving the system at a local level seems an appropriate measure, but not at the expense of international trade.
Research from the UN Food and Agriculture Organization (FAO) indicates that one out of five food items consumed crosses at least one international border.
The lockdowns imposed to contain the virus are therefore impacting on supply chains and agri-food logistics for one fifth of general produce.
Government action key to long-term resilience of food supply chain
Governments are stepping up measures to maintain agri-food supply resilience. But disruptions could well occur in the coming months, with the threat of a subsequent impact on public health.
Politicians are being urged by industry leaders to do more to reinforce the sector now or compromise business continuity in the future, and the post-COVID era.
The FAO cite developing and under-developed countries as most vulnerable during this time, due to their fewer resources.
Because of the impact on international supply chains, food price volatility threatens food security and nutrition, particularly those living in the poorest environments.
Emergency measures to counter the pandemic should be targeted, proportionate and transparent.
Difficulty presenting opportunity.
The United Nations and Intergovernmental Panel on Climate Change (IPCC) counsel that the pandemic presents the opportunity to transform how our global food supply chain system works, making it more future shock-resilient.
They advocate a shift towards local food production and distribution as a means of lowering the risk of food insecurity, malnutrition, and hikes in food prices, while creating local jobs.
It calls for a rural transformation to empower small producers and retailers and mainstream them in the food systems economy. Both collectively advocate promoting sustainable farming in a bid to develop stronger local and regional food systems, ultimately an additional layer of resilience.
EU Agriculture Commissioner, Janusz Wojciechowski has doubled down on that approach, stating reliance on overseas markets is “not good” for the EU’s food security.
He instead highlighted the importance of creating connections between farmers, the local food industry, and local markets, and cited the example of animal feed imports, such as the 36 Million tonnes of soybean imported each year from America, as a particular cause for concern.
At the same time, there is concern among leaders in the bloc that protectionist impulses dominate too much. Trade Commissioner Phil Hogan says it is “essential to keep global trade flows open” and EU farmers and food producers benefit greatly from open trade through beef exports regaining to China, pork to Mexico and baby milk powder to Egypt.
How to reconcile the need for greater resilience with the desire to maintain global trade connections is a difficult balancing act, and businesses are keen to see how policy develops in terms of future survival and growth.
Is food production self-sufficiency realistically possible? There is certainly a great case for greater local production, with the aid of advanced technologies, in arid and harsh climates.
The goals of environmental sustainability and increased local production do not need to be mutually exclusive especially when advanced technologies are paired with renewable energy sources in areas such as hydroponics and aquaculture.
The path forward for the global agri-food supply system can be improved if policymakers and industry experts respond effectively to the challenges posed by the hugely disruptive coronavirus.
It represents a chance to create better local supply networks and play to the strengths of the existing international food supply chain system.
Individual food and agribusiness companies seeking to understand their options and potential strategies in negotiating the current industry landscape should contact Farrell & Mitchell.
As Farrelly and Mitchell's co-founder and Managing Director, Malachy provides unmatched expertise. Working alongside CEO's, executives, and leaders from public and private sectors, Malachy empowers agribusinesses to fully achieve their potential.
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