The second wave of corona and the food industry
March 23rd, 2020, curfew was announced, and little did we know the curfew would turn into a lockdown and last for so many months. Our lives, economy, needs, environment and what not….changed forever and it will remain a big deal in history as the world saw a recession after long 40 years!
Today, we are in amidst of April 2021, fearing a second wave in the corona, the daily affected cases are yet again reaching a lakh and there is no denying in the fact that there is heightened fear that whatever economic recovery has been achieved in the past six months could be wiped out.
However, the covid 19 has been an eye-opener for the supply chain industry, since it’s like the heart of any business.
You can research, create and produce but what’s the point of it all when it is unable to reach the world. The supply chain was shaken, corona spread fears not only in those who were participating in the supply chain process but also those for who it’s meant to be supplied.
With time, industries have managed and updated their strategies to be prepared or at least be able to manage any such outbreak, if ever, more effectively. Now, let’s understand how the impact of the second wave of covid is on the food and beverage industry.
- Raw Material Supply :
Agriculture produce forms the key raw material for subsequent stages in the food value chain, can become a potential source of a bottleneck for the food & beverage industry.
- Trade and logistics :
To curb the outbreak of covid 19, many countries have imposed trade restrictions. Talking about just India and the
food industry, India has become a very important player on the global market, especially for rice, cotton, sugar, and beef (buffalo) and India is a major importer of edible oils and pulses…To make the fact simpler, India, on an average spends around 70,000 crores on its import.
- Demand-supply volatility :
The challenge would be to deal with the possibility of the irregular footfall of consumers and, contrastingly, to also assess the possibility of stockpiling food & beverage products to ensure continuity in consumer access to products they intend to purchase.
- Customer uncertainties :
A lot of unauthenticated posts and rumors go out in public which creates havoc in the human mind, it’s a natural tendency. There has been an influential perception about food and beverages, especially animal-based products in the crowd lately. However, WHO (World Health Organisation) has broken the myth that food cannot transmit the coronavirus.
On a positive note, As a nation, in 2021-22 we are going to prioritize PM’s Vision of “AatmaNirbhar Bharat” even the 2021-22 union budget stands in support of it. The agriculture sector is in the bright spot of the Indian economy, touching 303.3 million tonnes in 2020-21 beating record production levels for the fifth consecutive year in a row and the Purchasing Managers Index (PMI) declined to 55.4 in March. The food inflation trajectory largely is dependent on the impact of favorable Kharif and rabi seasons on cereal prices and seasonal winter arrivals on vegetable prices on one hand, and the adverse impact of rising international prices on edible oil prices and the persisting demand-supply mismatches for protein-based food prices. Experts predict that the post-harvest result is going to be a desired one.