Jonathan Havens and Kermit Nash, partners in the law firm of Saul Ewing Arnstein & Lehr LLP, review the experience of the food and beverage industry in the pandemic, in the form of lessons learned and possible permanent changes to the supply chain.
Among the big lessons for the food industry over the last year is that “our supply chains were not set up for a global pandemic,” says Havens. Suppliers found it extremely difficult to locate product and make changes to routing and shipping necessitated by COVID-19.
A similar realization occurred further up the food supply chain by the agribusiness and sourcing sector. “Many forget that for the last mile to be satisfied, the first mile has to work properly,” says Nash. Farmers could generate supply, but they couldn’t get their goods to market due to backups on the logistics end. Huge quantities of product were stranded. “When you have a pandemic,” Nash says, “it shines a light on where [the supply chain] is most imperfect.”
Now, partners in the food supply chain “are talking in ways they hadn’t before,” Nash says. The goal is to be able to rapidly pivot production and shipment destinations in the event of another disruption on the scale of the pandemic.
Government aid helped portions of the industry to weather the crisis. The U.S Department of Agriculture allowed industrial-size containers — which had previously been used exclusively by restaurants — to be sold by retailers. In addition, USDA’s Coronavirus Food Assistance Program (CFAP) provided temporary relief for producers that were having problems getting product to market.
President Biden’s recent executive order on critical supply chains “absolutely” includes the food sector, Havens said. “Food and water are always going to be deemed essential.”
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