Shaking Off Disruptions in the Food Supply Chain

Post By : News Desk
Post Date : May 9, 2020
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Reading Time: 5 minutes

The role and importance of the Food Supply Chain to a nation is undeniably cardinal in providing life and sustenance to the people.With the ongoing pandemic causing ripples in the supply chain, it is pertinent for the sector to gear up and take recourse to long term strategies that can help India tide over the repercussions of the pandemic. In this feature story, we explore the impact of COVID-19 on the Food Supply Chain and what lies ahead for the sector, as it wards off the disruptions in the chain.

COVID-19 has shaken the very ground of human survival and sustenance. As we enter the third phase of the lockdown, newer cases are being detected at newer districts every hour: spelling trouble and severe ramifications for the MSMEs and the entire food supply chain.

How grave has the impact of COVID-19 been on the food supply chains in India?

As governments struggle to develop policies to respond to the varied impacts to avoid supply chain disruptions, higher food prices, shortage of labourers and severe economic fallout looms over the nation and its people.

Essential industries such as production, growing, harvesting and delivering food have been allowed to operate, but a major obstacle appears to be the shortage of people showing up for work, who are responsible for the food reaching the kitchen from the farm. It is critical for the food supply chains to continue operating, as a country marred by hunger and compromised food supply, will only weaken them in their fight against the unknown enemy that the coronavirus is.

Is there an immediate threat to India’s Food Supply Chain?

The question at the moment is: Will India face an immediate threat with respect to its Food Supply Chain? This largely depends on how self-sufficient India is, when it comes to crops and pulses.

According to Mihir Mohanta, General Manager (SCM), Mother Dairy Fruits & Vegetables Pvt Ltd, “India is largely self-sufficient on food grains productions. Besides, it has a healthy reserve of it. Except for edible oil and pulses, it is not import dependent. Both edible oil and pulses being predominantly rabi crops, there is no immediate threat of it in the short term as rabi harvests are on. However, if the lockdown is prolonged beyond 6 months due to corona, it could have some bearing.”

This sums up the current crisis that knocks on our doorsteps. With no predictability at hand, it is difficult to ascertain how long the selfsufficiency of crops can ward off the threat that COVID-19 poses. Sunil Nair, CEO, Snowman Logistics attributes the food supply chain disruptions to primarily labour shortage and transportation issues. In his words, “The current limitations are primarily due to lack of labour and transportation availability. With the harvesting of Rabi crops and other perishables like fruits and vegetables, an extended lockdown will result in lower farmgate realisations that will permeate to other commodities as well. If normalcy is not restored, this will have a collateral impact on cropping patterns for the next season.”

The immediacy of the danger rests on the very shoulders that if normalcy to the entire situation and especially, the Food Supply Chain, is not restored, then the impact on the cropping patterns of the forthcoming seasons will be very risky.

Problems plaguing the Food Supply Chain of India:

As the clock goes ticking and the number of cases hit the ceiling, India’s Food Supply Chain currently battles ample number of problems that have become a worrying cause of concern, coupled with the unpredictability of the crisis.

LABOUR SHORTAGE:

Labour shortage is a major obstacle looming over the Food Supply Chain situation in India. As Mr Mohanta says, “It is impacting directly on the agri-produce harvest particularly on the fruits & vegetables. Those crops which require skilled labour, like grapes, banana and mango are much more impacted.” Fruits and vegetables have a time span, during which they ought to be harvested or it would rot away, thus resulting in lower output. Loss of perishables owing to labour shortage: Reports across leading newspapers have revealed how massive losses have surfaced due to the ongoing crisis, coupled with scarcity of workers and shrinking demands. Mr Mohanta shares, “As per a report published on 20th March in The Hindu, almost 35,000 MT of exportable grapes were struck due to corona,which was almost 1/3rd of the exportable grade. Transport issues are also responsible for the growing losses. As per a TOI report, almost 30% fruits & vegetables are affected due to labour and transport issues. The next in line it is also going to affect the processing of mango pulp as it is labour intensive. About 40% of mango pulp gets exported.” He adds how, for specific crops, labour availability will have greater ramification with the onset of major rabi crop harvest of wheat, mustard and channa. “Labour availability will definitely shrink, pushing the labour costs up to a large extent. Restrictions if continued, will also impact the Kharif sowing which would soon follow the rabi harvest,” he warns. Kharif crops are the crops which are sown at the beginning of the rainy season, e.g. between April and May. Rabi crops are the crops that are sown at the end of monsoon or at the beginning of winter season, e.g. between September and October. At present, the harvests for Rabi crops are on.

“The balance remaining segment of fruits and vegetables will be the most vulnerable in terms of supply chain. The organised players in this segment are just about 2-3%.Government interventions and controls are insignificant. This will be most vulnerable part of the food supply chain, which will get impacted even in the short run. This supply chain will not become stable unless at least 20% of it is operated by organised players. In a market economy, hoping that market will take care of supply chain is a hope beyond hopes. Hence, this sector needs attention.”

~MIHIR MOHANTA, General Manager (SCM), Mother Dairy Fruits & Vegetables Pvt Ltd

“The current limitations are primarily due to lack of labour and transportation availability. With the harvesting of Rabi crops and other perishables like fruits and vegetables, an extended lockdown will result in lower farm-gate realisations that will permeate to other commodities as well. If normalcy is not restored, this will have a collateral impact on cropping patterns for the next season.” As India’s Food Supply Chain battles labour shortage problems and transportation issues, it is imperative for the sector to gear up and stay prepared, should there be an extension of the present lockdown period. Although the country is tiding over the present crisis thanks to its existing inventory and self-sufficiency, one can only pray that normalcy is restored soon, in order to prevent any harsh implications on the seamless Food Supply Chain of the country

~SUNIL NAIR, CEO, Snowman Logistics Ltd

As India’s Food Supply Chain battles labour shortage problems and transportation issues, it is imperative for the sector to gear up and stay prepared, should there be an extension of the present lockdown period. Although the country is tiding over the present crisis thanks to its existing inventory and self-sufficiency, one can only pray that normalcy is restored soon, in order to prevent any harsh implications on the seamless Food Supply Chain of the country.

To read the full story, grab the Logistics Insider’s May Issue here.

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