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Global food security and climate change
- Climate change threatens essential crops such as corn, rice and potatoes as well as luxurious commodities like cocoa, sugar, coffee and wheat
- Extreme weather conditions disrupt harvests and supply chain, leading to shortages, price increases, and unpredictable crop yields.
- Climate change is shifting the growing areas
- Food and beverage companies are responding to tech innovation with AI-based forecasting, precision farming, and climate resilient sourcing strategies.
- Vertical farming, hydroponics and better storage and transportation systems are long-term solutions.
Food and beverage companies are facing an increasing crisis. It’s believed that changes will not be made fast enough to prevent disaster.
What is the problem?
The climate change affects essential crops such as corn, rice, wheat and potatoes.
Scott Kelly, Senior Vice President of Environmental Analytics at Risilience, a supply chain risk assessment company, says that extreme weather and climate threats are among the most significant risks to business and agriculture. Many companies remain silent about these unprecedented risks.
In addition, commodities such as coffee, cocoa and sugar, which are considered luxury goods, also face threats.
Threat to commodities from climate change
Andrew Dalziel is vice president for industry strategy and supply at Infor, a supply chain specialist.
It is especially important for crops that need to be processed quickly, like peas. There is little or no buffer stock to fall back upon if the crop gets damaged.
The challenges do not end there. Many growers and fresh produce wholesalers lack temperature-controlled warehouses and transport, meaning products can spoil quickly in excessive heat while still in the supply chain. Extreme weather can also disrupt transport due to flooded roads or damaged rail lines.
Extreme temperatures also drive up the price of cold storage. This is because it requires a lot of energy to keep precise conditions. For example, potatoes need to remain cool to store through winter.
If crops are exposed to rain, heavy or prolonged rainfall can cause outbreaks of diseases such as Botrytis. This can destroy tomatoes and lettuces.
In addition to posing a threat to food security, this scarcity also drives up the prices of manufacturers, retailers, and consumers.
Food security is threatened by a supply chain crisis. (Image: Getty/JJ Gouin)
Food supply chain fortunes shift
The shift in the growing conditions makes climate change and the extreme weather even more complicated.
Infor’s Dalziel says that northern Europe has begun to reap the benefits of longer seasons while southern regions are experiencing significant losses in yield. This leads to a tighter supply through a fragmented, risky system.
The real threat is from extreme weather.
In the last year, Europe experienced unprecedented droughts, unprecedented floods and extreme temperatures. These events have caused damage to crops or livestock and destroyed them.
Dalziel says, “This has a big impact on agriculture.” In the UK, amber warnings for weather and bans on hosepipes have a negative impact on farming. Spain, an important supplier of olives, vegetables and other products, struggles with heat stress, water shortages, and reduced yields.
Even when the rain does finally arrive, soils that have been dry for a long time are susceptible to becoming hydrophobic. This means they may struggle with water absorption, which can worsen dry spells. Changing rainfall patterns and temperatures are also contributing to the soil degradation, and increasing pest pressure.
Dalziel explains that “milder winters means pests are able to survive and multiply sooner in the growing season. This is especially difficult for organic growers and those who do not use pesticides.”
Precision farming helps to reduce dependency on natural resources by optimising water use and fertiliser applications. (Image: Getty/AndreyPopov)
How does the food industry protect its supply chain?
Although it is argued that the food industry does not move fast enough to reduce the climate threat, there are measures being taken.
Infor’s Dalziel says that “larger processors are diversifying their regions of sourcing, adding climate resilient crops to their portfolios and localising the processing in order to reduce transit time for perishable products.”
As well, suppliers are increasingly using AI, machine learning and other technologies to predict demand, harvest yields, and weather patterns based on soil data and past crop histories.
Food analysis innovations allow suppliers and manufacturers set sell-by dates that are more accurate, as they can now rely on actual product quality, instead of fixed lead times.
Precision agriculture helps to optimize water use and fertilizer application. This reduces dependency on natural resources.
Dalziel says that these tools will allow better planning, and quicker responses in the event of unexpected disruptions to supply.
In order to ensure the future of their business, 77% (of global food and drink organisations) plan to spend 20% more on technology in the coming years.
The UK has over 1,000 vineyards, and 200+ wineries. This is a result of changing climate conditions. (Image: Getty/Seth K. Hughes)
How can supply chains be further protected?
Dalziel, Infor’s Dalziel says that to better manage extreme weather impacts the industry must focus both on immediate action and a long-term plan.
Manufacturers can, in the near future, improve their digital systems by linking demand forecasts with supply chain planning. It will allow for quick and efficient responses in the event of disruptions. By sourcing from different regions, and by planning for various climate scenarios, you can reduce the risks of supply.
Dalziel says the wine industry is an excellent example. French producers now invest in British vineyards. The UK has over 1,000 vineyards and 200+ wineries. This is a result of changing climate conditions.
In the future, businesses in food and beverages are encouraged to invest more heavily in technologies that will make them adaptable and connected. Cloud-based platforms and AI-based forecasting tools, as well as real-time visibility of the supply chain, will allow businesses to anticipate and prepare for possible disruptions.
AI is also able to support real-time decisions on processing based upon the quality of ingredients. It can adjust recipes and formulas by suggesting alternative options within a range of acceptable thresholds. This helps businesses remain flexible in times when certain ingredients may be scarce.
It is more important to protect the current supply than continue searching for new alternatives that could be threatened in the future.
Dalziel says that glasshouses and hydroponics will be more popular in the future to improve crop predictability. They can control temperature, nutrients, and water while reducing waste.
We’re likely to see an increase in investment and innovation for storage and transport, as well, where technologies like advanced temperature and humidification control, better air circulation and intelligent energy management systems will help preserve product quality more effectively and extend shelf-life.
Climate Smart Food by 2025
Do you want to learn more about the ways in which food and beverage industries can prepare themselves for climate change? Register now for FoodNavigator’s Climate Smart Food series.
Climate Smart Food, a series of free webinars that helps food and beverage producers tackle climate risks with real-world solutions – such as smart farming or resilient ingredients. It also includes low-impact packaging to reduce emissions. Industry leaders and innovators will share practical insights and tools to future-proof supply chains.
Registration is FREE