In many parts of the country, Canadians report a growing number of empty grocery store shelves. It’s also happening in the United States and many other parts of the industrialized world.
Before the COVID-19 Omicron variant arrived, empty shelves were visible but few shoppers noticed. They were sporadic in the fall as supply-chain woes continued, and our food industry was essentially experiencing supply-chain fatigue. After many months of dealing with public health protocols, labour issues and higher input costs (which tends to create more tension across the supply chain), something had to give.
Due to its viral viciousness, Omicron made matters worse. From farm to store, most food companies have been operating with 20 to 30 per cent fewer people available to work. And most of the time, the labour involves perishable goods. For many farmers, processors and retailers, waiting just isn’t an option.
The storyline for January 2022 at the grocery store isn’t the same as it was in March 2020. Far from it. Most worrying, supply-chain issues are the driving factor behind food shortages and rising costs – not consumer demand.
Almost two years ago, shortages of toilet paper and food resulted from consumer panic, coupled with a collapsing food service industry. This time, supply-chain challenges are driven by Omicron, winter weather and, of course, public health measures at the border.
Nevertheless, while Omicron was a gut punch to the food industry, vaccine mandates for truckers are robbing the industry of the oxygen it desperately needs.
Canadians likely underappreciate how critical the border is to North America’s food security. Whether you’re for or against global trade, Canada has an unforgiving northern climate, along with a moderate population size living in one of the world’s largest geographic areas. Unless a sector builds a significant competitive advantage – and some have – it’s difficult to produce food in Canada while maintaining consumer affordability.
The vaccine mandate disqualified 8,000 to 16,000 Canadian truckers from crossing the border; on the American side, about 125,000 drivers can’t cross. With such a significant shortage of drivers, food access will undoubtedly become an issue.
Food will likely continue to be brought across the border, but we should expect it to be more costly. Motivating truckers to cover the Canadian market will likely come at a price. Reports suggest that getting a truck to cover the Canadian market is 25 per cent more expensive than it was just a few days ago.
Higher logistical costs, like anything else involving the supply chain, will catch up to consumers. That’s the reality of supply chain economics. And with fewer drivers, major buyers will be prioritized over smaller ones. Many processors will have a harder time getting the ingredients they need to manufacture the food we buy every day, on both sides of the border.
With food distribution, short-sighted government interference can generate market failures, more disruptions and more empty shelves at the grocery store.
However, the food industry has dealt with a lot over the past several decades. The pandemic has been challenging, but the industry has continued to execute and deliver the goods, despite some government-level lack of forethought.
The regulatory environment has always been a pain for the food industry and always will be. The pandemic is no different. So Canadians shouldn’t underestimate how resilient our food industry is. Consumers may not always find what they want, but they will always find what they need at the grocery store.
A trucker convoy against vaccine mandates at the border has raised almost $800,000. The convoy will continue into next week. It blames news outlets for the collective “COVID-19 hysteria,” as it’s called. Truckers have every right to protest but transporting goods is what we need them to do. The convoy isn’t likely to make much of a difference.
Meanwhile, Canadian consumers should know they will be fine. Operations across the supply chain are incredibly choppy but consumers will continue to find what they need, albeit with fewer choices.
Some of the choppiness is policy-induced, but it is what it is. Still, expecting perfection at the grocery store for the next little while would be unreasonable.
Dr. Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University.
Sylvain is one of our Thought Leaders. For interview requests, click here.
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