“Supply chains,” said Gregory DeCroix, “are complicated.”
Food Supply Chain Complications during COVID
The complications of the American food supply chain — and the havoc that COVID-19 has wreaked upon it, were the topic of The UW Now Livestream event on May 19. DeCroix is the Grainger Professor in Supply Chain Management at the Wisconsin School of Business, and he joined in a conversation with associate professors Jeff Sindelar and Heather White of the College of Agricultural and Life Sciences and Michelle Miller ’83, MS’93, associate director at the UW’s Center for Integrated Agricultural Systems. Mike Knetter, president and CEO of the Wisconsin Foundation and Alumni Association (WFAA), served as moderator and host during the live, YouTube broadcast.
The discussion focused on the unique aspects of the coronavirus pandemic and how it has affected almost the entire food economy.
The Disruption of COVID
“Why are we having struggles now?” DeCroix asked. “What’s different about COVID that’s causing some difficult problems? Disruptions are all over the place. You can have disruptions at a lot of different suppliers at the same tier in the supply chain. You can have disruptions at multiple tiers in the supply chain at the same time. You can have not just supply disrupted, but demand disrupted tremendously.”
Sindelar, a meat scientist, called the pandemic a “wild, wild roller coaster — one of the craziest times in recent history for meat processing.” He noted that, while the American meat supply is safe, the disruptions caused by COVID-19 outbreaks in processing plants have caused shortages. “Lots of people, not enough product,” he said. “And lots of pressure for demand and not enough supply.”
And while he discouraged viewers from hoarding meat, he noted that the temptation is strong. “Even as a meat scientist,” he said, “the thought was crossing my mind from time to time.”
Demand High for Grocers but Low for Many Others
White, who studies dairy, added that food supply issues are difficult to solve during the health crisis because it has damaged the restaurant and food service industries so severely. The system that supplies milk, butter, and cheese to restaurants can’t easily adapt to supplying the grocery market. Restaurants buy cheese in bulk; schools buy milk in small cartons. Grocers buy cheese in small packages and milk in gallons and half-gallons.
“Although the grocery store demand has increased, and we see consumers buying dairy products to eat at home,” she says, “it does not compensate for the amount of dairy product that would be consumed through the food service industry or the commercial industry.”
She added that 90 percent of Wisconsin’s milk goes to cheese production, and 40 percent of that cheese goes to the food service industry. Thus, a significant portion of the state’s dairy has no market.
Potential Lasting Effects
And the pandemic may have lasting effects, noted Miller. “The longer COVID-19 and the effects on our economy last,” she said, “the more our food system will change.”
The faculty members spoke for more than 40 minutes before taking questions from some of the hundreds of alumni who followed the livestream. But not all of their analysis was gloomy.
“We can never forget,” said Sindelar, “that the U.S. has one of the safest and most abundant food supplies in the world, and one of the cheapest, and there are reasons for that.”
The UW Now Livestream is a response to the COVID-19 pandemic. Though originally planned as a series of events in cities across the United States, it is instead offered via YouTube and will continue through the spring. The next event will be May 21 and will feature WFAA chief alumni officer Sarah Schutt, student leader for the Wisconsin Union directorate, Wisconsin Union Director Mark Guthier and American Family Insurance social impact investment director Shayna Hetzel ’07, MPA’08, as they talk about the history of the Wisconsin Union.