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Agricultural News

Investing in U.S. Food Supply Chain Resiliency

Thu, 15 Apr 2021 08:44:05 CDT

Investing in U.S. Food Supply Chain Resiliency During the height of the COVID-19 pandemic, shutdowns caused the U.S. food supply system to face a sudden shift from food consumed away from home to food consumed at home. At the same time, our food processing system was hit with a supply-side shock: A sudden labor shortage emerged due to the COVID-19 virus, forcing processing plant closures and reduced operating capacity.
Closures and slowdowns in packing and processing plants caused a backlog of millions of animals that were ready for harvest, while shifts in demand for pork, beef, eggs, and dairy created shortages at the retail level and excess supply in other areas of the supply chain. Companies that distribute and transport meat, eggs, and dairy operated below capacity due to high absenteeism among workers. The shift in consumption and supply prompted retailers to increase prices and ration supplies to avoid stock-outs.

Our highly specialized and efficient food processing systems were not able to quickly make the full adjustment necessary to respond to our new reality. The combination of these two shocks caused a backlog of animal processing. We had plenty of food, but not in the right form to match the switch to retail and grocery sales for at-home consumption.    

The “Agricultural Supply Chain Disruptions, Costs, and Mitigation Strategies to Enhance Resiliency of the U.S. Food Supply,” project, funded by the USDA National Institute of Food and Agriculture, explores how COVID-19 disrupted our food systems and how to avoid these issues in the future.

This project will examine what actions and strategies helped mitigate the in-pandemic responses and can assist in future impacts, especially in the case of a COVID-19 resurgence or another similar disruption to our food systems. Specifically, this project seeks to evaluate the main bottlenecks in the eggs, dairy, beef, and pork supply chains and to use that information and the experiences of producers, processors, distributors, and retailers to develop decision tools, investment strategies, and policy options that can make these supply chains more resilient in the face of such shocks.

COVID-19 disruptions implicate and put at risk occupiers of many levels of the U.S. food supply chain. The project’s immediate objectives focus on developing and making available data visualization and feasibility tools to help firms at critical levels of the supply chain to better manage the challenges they experienced. The researchers’ long-term goals focus on exploring the risk-return tradeoff of changes to each system, (for example, investments in labor and technology), to improve its resilience in the face of future disruptions. Their approach combines applied research and extension outreach.

Article courtesy of Dr. Keri L. Jacobs, PhD, Associate Professor Agricultural and Applied Economics, University of Missouri for a NIFA blog.



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