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Think globally, act locally: The effect of Covid-19 on local supply chains

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Local food systems received a major boost during the Covid-19 pandemic, and some suggest this could spur a transition to more sustainable food sourcing. What lessons are there for global food and beverage companies?

The number of people buying locally produced foods increased dramatically during the pandemic. One study found 35% of UK consumers were buying more local foods than before the crisis, while similar research found the same was true for 29% of French consumers.

But given the interconnected nature of the global food supply, sourcing local ingredients – and local expertise – has not been easy for many food manufacturers.

Impacts and opportunities

According to an international team writing in the journal Sustainable Production and Consumption:

“The COVID-19 outbreak stands out from previous global crises due to the rapidity of its spread and its all-encompassing disruption of supply chains. The agri-food system, in particular, has been impacted from production to consumption, both locally and globally.”

Early in the pandemic, even food and beverage giants were affected by logistical challenges amid lockdowns and border closures. The Coca-Cola Company highlighted potential disruption to its supply of Chinese-sourced non-nutritive sweeteners in its annual report, caused by delays in their production and export. In the United States, the two main food regulating bodies, the FDA and USDA, warned that any disruption in food supply had a significant ripple effect, “from growers and suppliers through processors and distributors to retailers”.

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Comparing local contexts

The authors of this latest review bring insights on the effects of the pandemic on the food production and supply in 13 different countries. They concluded that the crisis created opportunities for alternative and local food systems to extend their scope, especially given increased interest in sustainable food production from major retailers and food manufacturers.

“Our research perceives this crisis as a ‘large scale socio-economic experiment’ – a once-in-a-lifetime opportunity to see how different systems embedded in different local contexts reacted to the same challenges,” they wrote.

The researchers found that local food systems generally were well-placed to adapt and innovate in order to meet increased demand, despite disruptions in their supply chains. Local communities played a role in promoting and organising deliveries, for instance, often with an online component to reach customers.

“These innovations increased the visibility of [alternative and local food systems] while extending their reach to more people due to their perception as a safe option, enhanced by the practicality of home deliveries and online payments,” they wrote.

Protectionism and waste

On the other hand, a team of Turkish researchers writing in Food Quality and Safety, found restrictive policies intended to protect local supply actually led to increased food waste in some cases. Consumers were unable to find products that were not grown or produced nationally, while local producers were unable to access international markets to select the best buyers for their products – and manufacturers could not always find the ingredients they needed.

“When the export restrictive policies were applied, local sellers could not find buyers and resulted in excess supply and waste along with economic losses,” they wrote. “Foods that are not grown locally but needed for processing were not available due to the restrictions and capacity utilization of food-manufacturing plants to respond demand was also negatively affected.”

Recommendations

For food manufacturers, the researchers recommended training more local personnel to allow for potential cross-border restrictions, and increasing the skills of local employees. They also concluded that it is not only food that is essential – so are all the inputs needed to produce it. With this in mind, manufacturers should consider the most vulnerable points for supply chain disruptions, and adapt production, processing, and distribution accordingly.

“Companies also need to cooperate with competing companies on some issues e.g. raw material supply,” they wrote. “Small companies need to be more organized, using the crisis as a driving force. Firms should care about developing the information and communication technology infrastructure that can be used for the agriculture and food sector.”
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