Climate change is creating bottlenecks in the supply chain – and your supermarkets are not prepared for it

Before the days of antiseptic supermarkets, with their fluorescent lights and linoleum floors, food was sold in very different types of markets, most of which were unsuitable for a modern day health inspector. Take medieval Europe: even the stockiest of today’s carnivores would have felt a little queasy to see animals slaughtered not far from the final sale of the pieces of meat (if they were cut at all). Farmers brought in their produce from properties within walking distance of their homes, or at most a short horse ride away. In contrast, in the early 21st century, citizens are used to having their food come to them in the same way as their cars, clothes and appliances – via extensive international supply chains.

Unfortunately, just as a chain is only as strong as its weakest leak, a supply chain can become inefficient or fall apart with a small hiccup. This is especially true when the supply chains overlap so much that it is more of a “delivery maze” or “delivery node” than a supply chain.

Consumers may already begin to see the more derogatory terms as more reasonable. Brokers are reporting rising costs for vacation returns, and the Federal Trade Commission (FTC) has launched an investigation into a number of supermarket chains, brokers and grocery companies to investigate the seemingly endless shortage of products.

Based on this reporter’s own trip to two local retail stores including Walmart and Target, it was found that customer complaints seemed to fall into three main categories: electronics (like video game consoles or VR headsets), frozen foods (like chicken wings and pizzas), and toiletries like (you guessed it) toilet paper. Each of these items has a number of interlinked supply chains, from the food itself to the added ingredients to packaging, not to mention (in the case of frozen items) extra care with transportation and storage.

It is literally impossible to trace the origin of every single item used in each one, let alone put all of this data in a central database for reference. This means that this delicate and interconnected web of chains can easily be broken in innumerable undetectable ways if a major disruptive event occurs around the world.

The COVID-19 pandemic was one such global disruptive event.

“The world economy is a complex system of national and local economies,” Christa Court, assistant professor of regional economics at the University of Florida, emailed Salon. The pandemic brought key economic sectors around the world to an abrupt halt, which in itself impacted countless smaller business transactions. Not all of these could simply be lifted once the locks were lifted. Even then, these reversals often did not allow economic activity to be fully restored immediately, and were often applied so by leaps and bounds that they were eventually incorporated into the business environment.

“By now we are all familiar with the term ‘pandemic-related interruptions in the supply chain’, whereby the development of the pandemic itself (trends in cases and deaths) as well as the political reactions to the pandemic (‘shutdowns’, home orders, vaccine or mask requirements, etc.) have led to massive shifts in supply and / or demand for many products and sectors, “said Court.

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When it comes to food-based supply chains, climate change is another major culprit, albeit very difficult to quantify. Unlike other sectors of the economy, where both the demand and supply side can be disrupted, people never decide they are fed up with food. (They can change their dietary preferences, of course.) When there are supply chain problems, it is usually because an undesirable external variable has made it difficult for those who make food to do their jobs. Climate change is causing many of these undesirable external variables: Warming temperatures damaged American corn crops in 2010 and 2012, as did $ 220 million in losses on Michigan cherries in 2012. As the weather continues to warm, crops, which are dependent on exact temperatures at certain times are unbalanced or possibly extinguished. While moderate warming and increases in carbon dioxide will help some plants grow faster, even they will ultimately be harmed by the droughts and floods that will harm so many other plants.

“A severe drought in California or sub-zero temperatures in Florida can thwart this market,” said Dr. Ariel Ortiz-Bobea, associate professor of applied economics at Cornell University, opposite Salon in August. “These events can drastically reduce the supply of oranges from these regions. While oranges can be produced in other areas (e.g. Brazil), purchasing them is much more expensive, especially if the supply chains are not already established and prepared for larger quantities.”

In addition to climate change, there is also the built-in structural problem of capitalism itself: concentration of power and the fact that there are also supply chain disruptions because the global economic system is built on what individual powerful corporations have chosen to maximize their profits. A system that prioritizes profitability over everything else will make decisions about who receives What First, based on how they can make the most money, not who needs it most or what is most efficient. This means that supply chain disruptions, while not ideal, are not viewed as the absolute worst case scenario for any business either.

“It is a mistake to analyze supply chain interruptions as if they were exceptional,” said Dr. Richard Wolff, Professor Emeritus of Economics at the University of Massachusetts Amherst, emailed Salon. “They are regularly recurring products of capitalist decision-making. Just because the capitalists are spending the money their media focus on the conditions (which are constantly changing) and away from the profit-maximizing strategies of the capitalists’ reactions to these changing conditions. “

If there is a silver lining in supply chain crises, it is that more and more of these companies are deciding that it makes more sense to “store back” jobs than extensive, global supply chains. The term “re-shore” is an allusion to “offshore”, which refers to the relocation of jobs abroad. “Reshoring” means that these jobs are being brought back to the United States.

But until reshoring, the U.S. supply chain will remain as fickle as the pandemic has shown. Recently, a picture of a plastic container of pears went viral because of its packaging: “Grown in Argentina, packaged in Thailand,” it said on the packaging that was sold in the United States. Of course, many pears are grown in the United States; These pears’ three continent voyage was not only wasteful, but also fragile given the disruption – and the very existence of three continent pears speaks to the bigger problem.

About Christine Geisler

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