Making Food Supply Chains Resilient to a Changing Climate: Opportunities Are Everywhere

We all like to talk about the weather. And with the past 4 years being the warmest on record, there is even more to discuss. In 2019, the World Economic Forum reported that the top two global risks in terms of likelihood and having the largest impact were climate related: extreme weather events and failure to meet the required actions to adapt to and mitigate climate change. 

The Vulnerability in Agriculture

Our often highly complex international food supply chains are most vulnerable to shocks from weather and longer term climate change. In 2012, the Russian wheat harvest yield dropped by 33% due to drought, heat waves, and forest fires, sending global wheat prices soaring and resulting in a record high price for feed wheat. March 2015 brought episodes of unseasonably heavy precipitation in India, causing extensive damage to wheat, pulses, mustard, and grain. Farmers reported crop losses of over 50%, prompting the government to release state emergency funds.   

Solutions Are Crucial

We need solutions to the effects of a changing climate on our global supply chains. Food supply chains must become low carbon and climate resilient in the context of the energy transformation. This is why Guidehouse focuses on both the low carbon transition and climate resilience. Guidehouse works with clients to understand the impacts that more frequent extreme events and results of long-term temperature changes like rising sea levels and changing rainfall patterns can have on agriculture and forestry sectors and on supply chains globally.  

What Can Be Done?

For every problem there is a solution, as new regions open up to new opportunities as their climate becomes suitable for cultivating crops. Europe is starting to see examples of innovative approaches to building resilient food supply chains. Witness the farmer in England who for the last 12 years has been growing unconventional crops at his climate change farm, including olives, chocolate vines from the Far East, Peruvian oca, and Japanese wine berries. It’s not just smallholdings adapting crop choices and varieties: GlaxoSmithKline, together with the Scottish Crop Research Institute, invested in R&D to develop a climate resilient blackcurrant for the Ribena drink. These blackcurrants are resilient to the UK’s milder, wetter winters. The result is a supply chain that remains local to the market, and therefore is low carbon and climate resilient in the face of seasonal changes. Considering the physical risks and potentially exciting opportunities from a changing climate, Guidehouse advises clients which stakeholders across their values chains have the greatest capacity to prepare, adapt, and build resilience to these physical changes.

Innovation Abounds

Inspiring examples of low carbon, climate resilient food chains are popping up throughout Europe. Belgian, British, and most recently Dutch vineyards are developing award-winning wines as traditionally cooler zones such as northern Europe and the Pacific Northwest of North America are gradually warming and becoming a focus for opportunities in viticulture. In Germany, Infarm epitomizes the new low carbon, climate resilient innovative approach. Infarm takes its “farms” straight to consumers, reducing emissions across traditionally long and complex supply chains. Its crops thrive indoors with LED lights mimicking sunlight, plus they don’t require any soil and use 70% less water than traditional farming. 

Solving Problems in New Ways

The solutions to today’s unpredictable and evolving weather patterns as well as longer term climate changes require us to look forward. Past climate is no indicator of the future. Guidehouse applies the latest climate projections globally to inform clients how current vulnerabilities in different locations will change over time. Guidehouse advises clients on who to work with, where, and how to realize their own business opportunities. A wide range of inspiring projects can arise from planning ahead. Cheers to that!