SOS: How can the supply chain make GOOD food more affordable for the masses?

Posted on December 5, 2019

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Bad news for Canadians: your grocery bill is about to go up. Food prices are expected to rise by two to four per cent in 2020, according to Canada’s Food Price Report, meaning the average family will spend about $480 more on groceries next year. All food categories are set to get more expensive, with notable price hikes in vegetables, fruit, meat and seafood. That’s thanks to environmental policies, trade issues and unforeseen events like California’s E. coli outbreak linked to romaine lettuce, reports The Globe and Mail. – LinkedIn (Dec. 5th, 2019)

When the above story appeared in my LinkedIn newsfeed, I was moved to don my 60s radical persona and write the following comment:

Notice that the price hikes are on vegetables, fruit, meat and seafood. Yet the processed junk they pass off as food remains cheap. Maybe we should do a report on the rising health costs resulting from the ingestion of these chemical-laced products which contribute to or exacerbate a myriad of health issues including obesity, ADHD, and other serious ailments. In short, let’s make quality healthy food affordable.

My next thought was to send out an SOS to my vast network of procurement professionals, asking them how the supply chain can make GOOD food more affordable for the masses.

No sooner had the call gone out that I received a response from John G. Keogh.

Keogh is a strategist and researcher focusing on “Simplifying Complexity in Supply Chain Integrity, Technology, Transparency & Trust.” He indicated that part of the problem – at least in Canada, is that “we have legal price cartels (legal price-fixing) which accounts for 3 billion added costs annually for consumers on staples such as dairy.”

He also said that “we lack an innovation strategy,” concluding that “costs should be lower for foods.”

According to Keogh, we should follow the lead of the EU which has “started a ‘market transparency’ effort to understand the value creation in the food chain and to give more of the margin to farmers.” In other words, break the control that the cartels have over food distribution.

I think it is important to point out that the suggestion of cartels controlling market pricing is genuine, as demonstrated by the “great Canadian bread price-fixing scandal.”

In the absence of a similar initiative to the EU’s market transparency undertaking here in Canada, what, if anything can supply chains “do” to lower food costs?

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Posted in: Commentary