Agriculture Supply Chain
Retailers and manufacturers have been warning about shortages of goods due to issues with the supply chain. But how are those disruptions affecting agriculture? A supply chain expert at the University of Nebraska-Lincoln says producers and others along the ag supply chain are struggling with the impact of disruptions.
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[00:00:02.160](Reporter) When growing demand meets
[00:00:03.580]challenges in the supply chain,
[00:00:05.560]consumers see shortages and higher prices.
[00:00:09.130]University of Nebraska Lincoln, Professor
[00:00:10.770]Erkut Sonmez, studies, the food supply chain and
[00:00:14.470]how to make it more efficient.
[00:00:16.040]He says much of the world is facing
[00:00:18.150]a perfect storm of disruption.
[00:00:20.781](Sonmez) One side, we are having shortage
[00:00:22.710]on food supplies. People are looking for more food.
[00:00:26.040]And on the other hand, we have actually food produced
[00:00:29.123]that is just rotting or
[00:00:30.710]going bad in some containers in some part of the world.
[00:00:34.008](Reporter) Processing and packaging companies struggle
[00:00:36.540]with labor shortages.
[00:00:38.170]Freight rates are skyrocketing. Farmers grapple with
[00:00:41.700]shortages of fertilizer and chemicals needed to grow crops
[00:00:45.440]along with transportation and labor issues.
[00:00:48.293](Sonmez) In terms of farmers,
[00:00:49.990]they have been seeing significant labor shortages and
[00:00:53.680]especially in fresh produce, millions of pounds of
[00:00:56.590]fresh produce are not being harvested.
[00:01:00.235](Reporter) Sonmez says the agriculture supply chain was
[00:01:03.300]built for efficiency, not flexibility.
[00:01:06.470]When a hurricane or pandemic comes along,
[00:01:09.440]it's harder to recover quickly.
[00:01:11.670]Research can identify the problem.
[00:01:14.343](Sonmez) For example,
[00:01:15.176]what if I lose 20% of my production capacity to COVID?
[00:01:19.600]What if, you know, in the next five years,
[00:01:22.840]50% of the truckers retire.
[00:01:25.130]So we need to implement these kinds of what if stets, tests
[00:01:29.870]and scenarios to identify the bottlenecks.
[00:01:32.603]We can then actually direct our efforts to improve the
[00:01:37.100]bottleneck points of the supply chains.
[00:01:39.363](Reporter) Food shortages could impact
[00:01:41.140]the Thanksgiving table,
[00:01:42.530]and we can expect to see higher prices on store shelves
[00:01:45.980]and restaurant menus.
[00:01:48.061](Sonmez) Definitely I expect higher menu prices
[00:01:50.770]on restaurants, higher food prices on any fresh produce or
[00:01:54.860]any pack packaged produce.
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