Adjusting to the new normal: Challenges of the food sector in the wake of COVID-19

The ongoing COVID-19 pandemic has affected more than 180 countries around the globe causing severe business disruptions. Lockdown in many countries has led to panic buying and shortages of food, medicines, personal protective equipment, raw materials, basic goods, etc. As a result, while some businesses have benefited from this sudden spike in demand, many others have collapsed, and many are at the brink of collapse unless and until rescued by governments or private investors. In particular, the food sector which heavily relies on global supply chains to meet the demand of their local consumers are working around the clock to maintain the adequate flow of food products to feed the nation. However, countries that have taken strict measures such as full lockdown are struggling to balance their demand and supply as in-country and cross-border supply has been severely affected. Stock-outs are much more common in the early phase of the crisis due to panic buying that influence the vertical supply chain. To meet the changing food demand, grocery retailers have started working more closely with local farmers for the essential supply of food items, thus realizing the benefits of short food supply chains. This discussion paper attempts to explore the way food sector is dealing with the current unprecedented situation and proposes some potential risk-mitigating pathways