COVID19 Disrupts Global Food Supply Chains – Impact & Possibilities
Disruption and damage – When the global food supply chains were going through a transition, from farm to fork, the pandemic COVID-19 happened and damaged the entire ecosystem. From farms to the consumer, the supply chain came crashing.
It is predicted that by the end of this year 2020, more than 130 million people would be facing starvation in addition to 800 million people who are already facing undernourishment and 135 million who are battling the hunger crisis in their lives, in the world. The reality could be worse than expected. The biggest threat is not the availability of food but access of food to the end buyers.
Let’s explore some ways in which the pandemic has created a shift and impacted the Global Food Supply Chains
Conflict and hunger
Countries like Yemen, South Sudan, Central African Republic are suffering from protracted food crises due to the implications of COVID-19. The global increase in hunger has seen a rise driven by armed conflict. Response to this ongoing crisis requires huge resources and at the same time, protecting livelihoods. The frequency of disasters have hit harder, conflicts have seen an increase and a crisis-affected population of displaced people are facing consequences. The situation has also propelled food insecurity that has given a steep rise to violent riots in countries like South Africa and Afghanistan. The government and humanitarian organizations’ capacity has weakened to cope up with socio-economic and health impacts. Unemployment and inequality have created resentment.
Geopolitics and Food Supply Chains
The geopolitical dimension has converged with the crisis of multilateralism. Intergovernmental institutions, from the World Health Organisation (WHO) to the United Nations Security Council (UNSC) to the World Trade Organisation (WTO) have become a stalemate with less room for global cooperation.
On the economic front, this situation has led to the growth in unilateralism amongst the major governments. Food imports have turned the industry to a political ground for countries with recent examples like the US-China as trade tensions continue to rise. The friction has shaken the food supply chains and the threats to food security have escalated exponentially. The pandemic has pushed the governments to reconsider the economic interdependence and protectionism. Here are a few measures and numbers that highlight how geopolitics have impacted the industry
- 71 countries have imposed Export restrictions and ban on medical supplies.
- Export bans on food have been imposed by 19 countries of the world.
- Export of grain, particularly wheat, by Russia which could lead to a spike of food prices across the globe.
- Export bans on global food exporters of rice like Vietnam and Cambodia.
- Instant quality testing on trade and safety parameters
10 percent of the total food imports in 54 countries have been adversely affected due to restrictions as a measure to ensure sufficient food supply for the exporting countries. This has taken a toll and has left people craving hunger. Regions that include the Middle East, North Africa, and sub-Saharan Africa have been majorly impacted which has led to the price volatility of the food in the International market.
Countries with low income are unable to cope up which make them vulnerable to an extent that there is a great economic shock in exports and import markets. According to the World Food Programme (WFP), ‘the economic consequences [of COVID-19] will be more devastating than the disease itself.’
Risk Management to Global Resilience
When critically analysed, global hunger is an issue not limited by demand-supply or scarcity but a consequence of politics and political choices. It is the economic and social access to food, distribution of rights that have brought us here. Issues like climate change, gender-based inequality, asymmetric distribution of resources, armed conflict; all have their roles to play. Eradicating hunger requires joint efforts by all the UN states as part of Agenda 2030.
The flip side to balancing benefits and trades is the increased vulnerability of these low-income countries or the developing countries to external shocks. Post-pandemic, the struggle to find a balance will be taken over by the governments across the world. However, conversations and dialogues to ensure that the worst consequences can be mitigated for the vulnerable are going to help in the long-run.
Interdependence and Interconnectedness
Interconnectedness is a double-edged sword that brings risks and benefits alike and maintaining a balance between the two is even harder. One of the central features of the global food supply and agricultural system, every four out of five people are partially dependent on imports for their food demands.
As per the FAO, ‘critical parts of food systems are becoming more capital-intensive, vertically integrated, and concentrated in fewer hands’. The risk has become concentrated and agro-export has brought down the supply chain resilience and has negatively affected the biodiversity and the environment as a whole, the foundation of our food systems.
Interdependence is the key. For most of the countries, given natural resource and technological balance constraints with climatic conditions, becoming self-sufficient for food production to feed the population is almost next to impossible. A collaborative effort can only help bridge the hunger gap.
Do we foresee most countries moving towards policies that limit their dependence on food imports as a measure to improve their capacity to respond to any future crisis? The FAO does expect substantial increase in hyper local vegetable production, however not much change is predicted in movements of staple food exchange such as rice, maize, fruits, meat, as these constitute the most traversed foods globally.
One immediate impact could be improved inter-regional trade, resulting in shorter food chains, creating markets for farmers and increasing access to both inputs (seeds, fertilizers) and outputs (food products) to global markets.
Possible roles large international food companies could play in addressing the impending lack of access to nutrition and food supply in low-to-middle-income countries, the FAO suggested these countries create a crisis committee involving, ministries of agriculture, food supply, livestock, economy, trade, transport and so forth. It is imperative to engage private sector players in aiding the activities of the crisis committee via a broader perspective on multi-stakeholder advisory for fairer representation of all actors in the food supply chain.
Overall, the food is far from an economic commodity but is rather a deeply entrenched social and political issue. Universal provisions, which believe in inclusivity and resilience will help us build a culture and society that works together to overcome this widespread issue and come out stronger in the post-pandemic world.