That’s the title of a new report on the impact of the COVID-19 pandemic on Indiana and the future of food and agriculture that I helped prepare with Ernst & Young (EY) for Agrinovus Indiana.
The report aims to characterize and document the particular features of the Indiana agricultural and food supply chains (including interviews with key players in the chains) and identify how different segments have been affected by the pandemic. Some key findings include:
Aggregate losses attributed to the pandemic across major commodities produced in Indiana (corn, soybeans, hogs, dairy and eggs) are estimated at more than $500 million.
During the spring lock-downs, food-away-from-home spending in Indiana fell by over 60 percent, and remains down by over double-digits from January 2020; and
The increasing complexity in food retail continues to grow - in the 1960s the average grocery store offered 6,000 products – today, that number is more than 33,000.
Recommendations are:
Implement transparency and traceability – Consumers, customers, processors and manufacturers increasingly require transparency, and companies need the ability to see real-time information about their supply chains.
Increase collaboration – To meet evolving consumer needs for nutrition, affordability, sustainability and transparency, food companies need to collaborate between buyers and suppliers to measure and manage risk.
Build last-mile agility – A balance of efficiency with robustness must exist in the food supply chain to plan for systemic disruption. Manufacturers should consider inventory holding arrangements with adjacent chain participants to build disruption buffers.
Reexamine customer segmentation – Consumers are changing the way they shop, the products they purchase and the attributes they prioritize. Companies need to focus on key purchase criteria, shopping behavior and generational differences.
Invest in the future – Changes in labor availability and consumer demands offer enormous opportunities for investment, and Indiana has the infrastructure, knowledge and skilled labor to compete for venture capital funding in food and agriculture.
I enjoyed working on this project, which was the brainchild of Mitch Frazier, president and CEO of Agrinovus, with the work being led by Brian Bourquard at EY and assisted by, among other people, Kendra Morissette, a PhD student in Agricultural Economics at Purdue.