Turbulence in supply chains is cracking yearslong stability globalization brought to food sector...
Food-price inflation hit multidecade highs this year in the U.S. and elsewhere, outpacing overall consumer prices. The Wall Street Journal reports (link) food-industry executives and economists point to manufacturing and transport disruptions stemming from the pandemic and the impact of Russia’s invasion of Ukraine on energy and grain prices. The impact of those issues may be receding, but analysts expect price swings to be more frequent.
Huge gains in farming and food-manufacturing productivity, globalization and lower transport costs have all served to expand choice and hold down prices for consumers. Some suppliers say they will try to source more goods closer to home, but that will be a heavy task since almost a quarter of overall global food exports now have a foreign component, according to the World Trade Organization. “Everything was working in perfection, and then the pandemic happened,” said Felipe Hasselmann, CEO of Cuisine Solutions, on the vacuum-packed meals producer’s supply chain.
