WATCH: What to watch for as coronavirus impacts the global food supply chain, Decernis COO

By Elaine Watson

- Last updated on GMT

Related tags Supply chain Decernis coronavirus COVID-19

Kevin Kenny, COO at Decernis, a Foodchain ID company, has identified some key supply chain issues to watch going forward as coronavirus spreads across the globe.

•            ​"Passenger aircraft account for the majority of air-cargo volume in the world.  With numerous airlines grounding the majority of their passenger fleets, there is an unprecedented shortage of cargo capacity – meaning delays and dramatic short-term air freight price increases.

•            "Even before COVID-19 hit, there was a trend toward overt 'me-first' nationalism.  That has greatly accelerated as countries including Cambodia, India, Kazakhstan, Russia, Serbia and Ukraine stop the export of key commodities​. Critical supplies are also being diverted to more developed countries which can outbid and pay higher prices.

•            "​Food security risk is growing in smaller and poorer markets.

•           "In the medium and long term, entire supply chains will need to be rethought. The inexpensiveness of China, India, Vietnam and Thailand will now be weighed against the newly obvious threats to supply chain stability. 

•            "​In addition, the recent supply chain trend had been toward large multinationals partnering with fewer providers with much deeper relationships.  After being burned by force majeure, I expect that this trend may be reversed once the dust settles.

•           "The lack of migrant agricultural workers, coupled with the closing of restaurants/schools causing a steep drop in demand, is leaving very large swaths of food 'un-processible.' Pork, eggs, milk, early harvest fruit and vegetables are all being destroyed or tilled under.  Animal farmers also report problems affording feed as prices spike​.

•           "Everything sourced from India is currently disrupted, and it will take some time to undo that damage. I expect the knock-on effects to be even greater as Western companies rethink supply chain exposure."

•          ​"Obvious bankruptcy candidates include movie theaters, airlines, cruise ships, retailers and hotels.  However, any company caught carrying a large debt load is suddenly endangered."

Keep up to date with global food supply chain developments via Decernis HERE​.

Read more about the impact of coronavirus on the food supply chain and consumer behavior:

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