The last few years have revealed just how vulnerable the Canadian food supply chain is to disruption, and the resulting challenge it creates for our food companies.
The effects of extreme weather events, the COVID-19 pandemic and the war in Ukraine are impacting supply chains around the world. For example, the pandemic restricted the movement of workers and created changes in demand for consumers, while temporarily shuttering food production plants and restricting food trade policies are putting added financial pressures on the food supply chain. And Russia’s war on Ukraine has forced nations to push additional grain, corn and fertilizer supplies into world markets to make up for supply disruptions.
In Canada those factors have highlighted weaknesses in our national, provincial and regional supply chains, leading to production interruptions, facility closures, labour shortages, and rising input costs.
At the same time, economic recovery hasn’t been the same across food sectors. Restaurants and foodservice operations, which saw the most closures during pandemic, and which have suffered from consumer trends towards at home dining, have experienced significant supply chain shortages and price increases of ingredients such as chicken and corn. In fact, a recent National Restaurant Association survey revealed that 95 per cent of U.S. restaurants had experienced considerable supply delays or shortages in recent months. Meanwhile, the rise of omni-channel sales has pushed fulfillment capabilities to the maximum at all points throughout the supply chain.
Digital solutions for supply chain resilience
Supply Chain 4.0 solutions as they relate to food businesses, include:
- Digitizing and automating key elements of operations
- Applying Internet of Things (IoT) and Industrial Internet of Things (IIoT) technology
- Applying technology with artificial intelligence (AI), machine learning and robotics
- Using blockchain and data analytics to supply chain management to improve efficiency, traceability, performance and customer satisfaction.
While the move to digitization and Supply Chain 4.0 solutions has been slower in the food industry than in other sectors, it has the capacity to strengthen our food supply chains and make them more resilient against ongoing and future challenges. With new tools to address the increasing volatility in customer requirements and supply availability, while addressing overall efficiency improvement expectations and food safety needs, Canadian food companies will be able to move products faster, with more flexibility, granularity, accuracy and ultimately with less risk of disruptions.
CFIN is leading the call for research, development and demonstration of digital and digitized solutions for Canada’s food supply chain with the introduction of a Food Innovation Challenge called Digitization and digitalization solutions that create safer, more secure, more agile food supply chains. Program priorities include: data capture and management; predictive analytics and demand planning; automation of the physical flow of goods; digital order management; driving improved capacity utilization in food processing; and food safety and traceability throughout the supply chain.
Look for more information on digital and automated supply chain solutions over the next few weeks, including articles on 5G and blockchain.
If you have a digital solution to make supply chains safer and more agile, apply for our Food Innovation Challenge. Applications are due July 7th.
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