Analysis: Will COVID-19 cause food shortages in the United States?

April 8, 2020 by Joseph Fitsanakis

The food supply chain in the United States has so far been able to endure the pressures caused by SARS-CoV-2. Grocery stores across the nation remain generally well-stocked, even if in some cases (like in Nevada and Arizona), the National Guard has been brought in to help with restocking. Shortages in certain types of foods, such as canned soup or pasta, are the result of unprecedented demand, rather than a breakdown in the food supply chain. Overall, therefore, there are no signs of systematic food shortages across the nation. However, disruptions —some of them severe— are likely to be experienced in the coming weeks.

COVID-19 IMPACT ON FARMS

Disruptions are likely to be felt first in the area of fresh produce, for two reasons. First, because large agricultural facilities are beginning to experience major shortages in personnel, as seasonal farmworkers —most of them from Central and South America— are unable to travel north due to the cessation of international travel in the Americas. Second, because —just like medical personnel across the country— agricultural workers are facing severe shortages in personal protective equipment (PPE), which is essential for keeping them healthy in a pandemic. Until now, major COVID-19 outbreaks have been occurring in densely populated urban centers. But as the disease continues to spread, it is only a matter of time before the virus reaches rural farming areas and enters farms, which are the beginning of the food supply chain. Many automated agricultural facilities, such as grain and soybean operations in the American Midwest, do not require large numbers of human laborers, and will thus suffer little disruption from the spread of the pandemic. However, this is not the case with fruits and vegetables, such as tomatoes or grapes, which require human pickers to extract them. The progression of the disease in rural regions of Florida and California, which produce over 20% of total US agricultural value, will be a critical factor. As an illustration, is worth pointing out that two farms in California supply over 85% of all carrots in the US market. If COVID-19 affects the production and distribution capacity of global producers of fresh fruits and vegetables, like the Florida-based Fresh Del Monte Produce, the ramifications are likely to be felt across the world for more than a year.

AGRICULTURAL DISRUPTIONS IN WESTERN EUROPE

Western Europe, which is ahead of the US in the spread of the disease, is already experiencing unprecedented disruptions in agricultural production. The closing of international borders has prevented millions of seasonal farmworkers from Eastern Europe, whom agricultural facilities in Western Europe rely on to pick fruits and vegetables each year, from traveling west. Italy and Britain hav e begun issuing calls for unemployed workers to form “land armies” and volunteer to pick produce in farms. The French government has called “for hairdressers, waiters, florists and others temporarily unable to work” due to the pandemic “to head to the nation’s fields and start picking”. And in Germany, the authorities have launched a website that solicits volunteers to work in farms across the nation. However, as only 16,000 have volunteered so far, the German government is now working on a plan to allow undocumented immigrants to make up the remaining 284,000 farmworkers that are needed to salvage this year’s crop.

DISRUPTION IN THE GLOBAL FOOD EXPORT SYSTEM

It is unrealistic to expect that these glitches will not eventually make their way to the US. Moreover, just like Western Europe, the US relies heavily on imported foods. The global nature of the pandemic is also beginning to cause major disruptions in food exports, as air and ship cargo dwindles dramatically. Already, the shortage of refrigerated containers used to transport meat and other food supplies from China to North America has prompted a drop in imports of over 25%. Meanwhile, India, which is the world’s largest exporter of rice, has completely halted exports due to logistical problems and labor shortages caused by the pandemic. The world’s second and third largest exporters of rice, Thailand and Vietnam, are likely to soon follow suit. Kazakhstan, which is among the world’s largest exporters of wheat flour, has now banned all exports of that product. Brazil, the largest exporter of coffee, sugar and soybeans in the world, has warned that it is facing an unprecedented shortage of farmworkers, truck drivers, and even spare parts for farm equipment. And Russia, which is the world’s largest exporter of wheat, has said that it will soon be forced to severely restrict exports for the same reasons as Brazil. These developments prompted the United Nations Food and Agriculture Organization to warn last week that food shortages, coupled with growing trade barriers between nations, “will create extreme volatility” in global food supply.

FOOD SUPPLY LOGISTICS AND DISTRIBUTION IN THE US

Finding enough truck drivers to distribute food from farms and packaging facilities to the grocery stores may soon begin to become problematic in the US as well. In an attempt to anticipate this potential problem, agricultural lobby groups have been pressuring the US government to increase truck weight limits on the country’s highways, so as to enable more food to be delivered with fewer trucks. In the meantime, the sudden change in demand from restaurants and school cafeterias (almost all of which are now closed) to retail grocery stores is “creating logistical and packaging nightmares” for food packaging plants across America. This is especially affecting dairy, meat and fruit-and-vegetable producers, who are “struggling with the shift from wholesale to retail, causing plentiful products to run short on grocery store shelves”. Furthermore, the same PPE shortages faced by farmworkers are also being experienced in the processing and distribution sectors of the food supply chain. Yahoo News recently quoted food economist Shub Debgupta as saying that “the movement of food down the supply chain [is not] the biggest potential problem. The issue really is in the distribution. If we don’t address that […] we’ll be in quite a lot of trouble”. According to a report by the US Department of Homeland Security, if the coronavirus pandemic enters the food packaging and distribution chain, there would be shortages of milk within 24 hours, while “meat, poultry, seafood, processed eggs, dry goods and processed foods inventories would become scarce within two to four weeks”.

CONCLUSION

Even though the food supply chain in the US is not operating under normal conditions, consumers are able to find almost everything they want for the time being. However, the coronavirus pandemic will inevitably pose challenges to every aspect of the food supply chain, including production and distribution. A major concern is the severe shortages of PPE in agricultural, packaging and distribution facilities. Once COVID-19 enters the food supply chain, it could cause severe disruptions that will be felt almost immediately in the availability of fresh fruits and vegetables, as well as dairy products. However, shortages are expected to be intermittent and, unless the virus incapacitates large portions of the food supply chain, these shortages should not be expected to have devastating consequences for the average consumer. Nevertheless, it should be noted that, even under the present conditions, a full line of products will not be available at grocery stores until the fall.

► Author: Joseph Fitsanakis | Date: 08 April 2020 | Permalink