Solutions to Supply Chain Challenges
Social media during the pandemic broadcast countless images of empty grocery store shelves, often fuelling panic buying among shoppers. But in reality, according to Professor of Food and Resource Economics Dr. James Vercammen, supply systems held up well throughout this uniquely demanding time. “Similar to previous crises, our local and global food supply chain demonstrated a high degree of resilience during the COVID pandemic through a rapid redeployment of available labour and repositioning of available food stocks.”
But that’s not a cause for complacency, adds Dr. Vercammen, a joint appointment between LFS and the Sauder School of Business who teaches highly insightful classes on Managerial Economics and the Strategic Economic Analysis of AgriFood Markets. His ongoing research work also includes a rigorous statistical analysis of prices, informing a deep-level understanding of cost transmission and its effects on consumers.
While supply chains have been adept at weathering temporary shocks, says Dr. Vercammen, costs within those systems have surged in recent years. And that has triggered price rises and a period of sustained inflation, directly impacting consumers’ ability to access affordable food. “Immediately after COVID, costs at every level of production—from labour to ingredients to transportation—began rising. And these costs are currently being routinely passed on to consumers through higher prices,” he says.
As supply chains struggle to find ways to absorb their increasing costs, there are also additional—and potentially far more stressful––pressures waiting in the wings. “Climate change is the biggest future challenge for supply systems. And at this stage,
we’re only just starting to understand how it could impact our food chains,” says Dr. Vercammen, who was raised on a Saskatchewan grain and cattle farm and is a past-president of the Canadian Agricultural Economics Society.
While some experts suggest bolstering local supply chains could be the answer to future woes, Dr. Vercammen believes the far more complex global system is likely better positioned to maintain food access in times of stress. And he expects increasing innovation to become a key factor in the efficacy of these systems. “Big data and artificial intelligence will play much bigger roles in food production, enabling food to be produced at far more optimal levels. While some view these technologies as scary, I believe we need to do whatever it takes to produce enough food.”
We’re fortunate in B.C., adds Dr. Vercammen, that we have resilient local food systems as well as access to strong regional and global supply chains. But there is always room for improvement. “Every time there’s a crisis—avian flu or crop failures in California, for example—we gain more knowledge about how to manage and improve supply chains. And I know that farmers and producers are working hard to adapt and innovate. In terms of resiliency, I’m concerned about the challenges that lie ahead but I also remain optimistic.”
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Tagged with: 2024, Food and Resource Economics
