Pandemic pantries: pasta, portfolios and purchasers

Viewpoints
March 26, 2020
1 minutes

Globalisation has brought us huge benefits, not least of which is access to previously exotic food stuffs. However, with global supply chains being tested to the limits by the current crisis, companies and consumers are coming to understand where the inherent bottlenecks are in the system and how that impacts on their bottom lines (and their bowls).

As 2019's Brexit false start demonstrated, the UK was more exposed than other countries to supply chain shortages and disruptions at key ports, but with border closures across Europe and North America it will become increasingly difficult to move products even if raw materials have made their way to processing centres. This is before we take into account the seasonal demand spikes that are counter-cyclical between hemispheres. 

Moreover, with the White House Health advisor implying that the coronavirus may become a seasonal event, these issues have the potential to be added to the permanent physical risk portfolio, along with droughts and floods, that the farm-to-fork supply chain needs to overcome. 

Against this backdrop, will production of raw materials (such as the Canadian wheat necessary for our comfort carbonara) be priced such that geographic proximity to end user becomes more attractive? 

For those processes to become viable, especially in smaller European countries with limited capacity for agricultural output, greater efficiency in process and perhaps less human involvement will become necessary. 

Investing in, and financing, the right new technologies and processes that assist in this opportunity should take advantage of the US$31 trillion market in Green Finance that is searching for long-term deals partly aimed at sustainably increasing agricultural yield.