Food Supply Chain Management

Building a Sustainable Future

Madeleine Pullman, Zhaohui Wu

• Publisher: Routledge
• Year: 2021
• ISBN:
  9781000372915
• Edition: 2
• Topic: Business
• Subtopic: Agribusiness
• Index: Business

This fully updated new edition of a respected text retains the original's comprehensive and practical approach to food supply chain management, and introduces a global perspective and a wide range of new material. More than ever, this is the food supply chain management textbook.

With an introduction that speaks to academic and non-academic audiences alike, the second edition of Food Supply Chain Management covers all-new topics such as cold chain management, "last mile" logistics, blockchain and traceability in the food supply chain, and the implications of global trade and climate change. Case studies examine the farm-to-table movement, sustainable co-ops, and more, with "quick facts" and mini-cases that are engaging and thought-provoking.

This textbook is appropriate for upper-level undergraduate and postgraduate students of agricultural business, natural resources, and food science, as well as supply chain management students.

Supporting online materials include lecture slides, test banks, and instructor manuals.

Chapter 1

Introduction to Food Supply Chain Management

OBJECTIVES

• Establish an operating definition of the food supply chain and describe the role of the food supply chain manager.
• Understand the growing demand for food and its environmental, social and economic influences on production.
• Examine the sustainability challenges in food supply chain management.
• Consider key food supply chain trends.
• Describe the impact of the pandemic on existing food supply chains and the implications.

Chapter Overview

This chapter, and the textbook it introduces, addresses food supply chain management and policy as among the most significant issues facing humanity. We look at the growing global demand for food and the related sustainability challenges. Then we turn to emergent food supply chain trends that may help to address these challenges. As never before, food supply chain prospective managers have the opportunity to guide food supply chain structure and production systems in a more sustainable direction.

Introduction

In 1950, a former JC Penney employee opened Walton’s Five and Dime in Bentonville, Arkansas. By reducing per-item profits and sourcing merchandise at lower prices than his competitors, this entrepreneur beat JC Penney prices and outsold the veteran retailer, founded in 1902. Today, Sam Walton’s company is the world’s highest-grossing retailer and the original location is the Walmart Museum. Walmart has remade the retail industry by driving down expenses, including the food sector. Today, the company is automating its refrigerated and frozen food warehouses to speed delivery to its stores. It offers food delivery service for its online customers. And it is entering the beef production business with plans to remove middlemen from its supply chain.

Walmart’s growth parallels the story of food and food supply chains in the 20th and early 21st centuries: cost-cutting, narrow margins, market consolidation and vertically integrated production. Food companies all seem to be growing larger and larger with profits concentrated at the very top, while workers and the environment bear the brunt in many cases. (It should be noted that Walmart ranked best among US grocers in a 2018 Oxfam study of human rights.¹) Critics say the system is not sustainable. Proponents claim that it is the only way to feed a hungry world.

In the broadest and simplest sense, food supply chain management is the process of getting food products from producers to consumers safely. In some regions of the world, the process is still fast and direct: grow it and eat it. But even in such areas, supplemental food from other sources is generally available. Isolated villages in Africa or India, for example, have at least one market that supplies staples, grains and refrigerated goods. Most Western countries rely on networks of producers (farmers, ranchers, processors and manufacturers), middlemen (aggregators and wholesalers), retailers (supermarkets, local grocers and grocery chains) and the infrastructure on which they all draw (transportation, information and communication systems, and electrical grids). Food supply chain management requires working knowledge of each as well as the business acumen to bring them all together. In addition, food supply chain managers must deal with perishability and short shelf life to ensure cleanliness and quality. It is by no means an easy job, but when it works, a reliable food supply is essential to the quality of life for people everywhere.

The Food System & Society

In 2020, the global pandemic turned the world’s food supply chains upside down and inside out. Many who work in the area have been concerned about the vulnerability of the food supply chain for years due to the increasing structural problems of consolidation, specialization and the resulting dangerous power dynamics. Additionally, the social and environmental problems associated with this industry have been building for decades. These issues became headline news as store shelves emptied and households on every continent had their first food supply chain lessons. As people wondered why meat, canned goods and toilet paper could not be stocked, they learned about specialized supply chains, sickened food workers, food industry segments such as institutional versus retail and many other issues we’ll explore throughout this book. Many people began to stockpile food, learn baking and cooking skills and even grow food in their backyards.

The pandemic accentuated the fragility of food supply chains in every country where bottlenecks from a meat plant closure or sickened fruit packers could stop the flow of food overnight. It revealed the broad crisis of our food system and society—some of the most critical frontline workers during the pandemic are the lowest paid, often migrant workers in food production, retail and delivery. The pandemic found many of its victims in aging, ethnic minority and low-income neighborhoods where people are subject to chronic health issues and limited access to healthy food.

The unfolding Covid-19 pandemic illustrates how the methods we use to produce, distribute and consume food reflect the values of society and spotlights the social, economic and environmental challenges we face. It also points to alternative paths—eating healthier food, consuming less meat, demanding policy changes to improve both food safety and security and supporting local and regional food systems. Some of these are individual choices (with far-reaching effects), while others involve society at large that could lead to structural, long-term changes.

Many communities have realized the importance of demanding products that support local and regional agriculture—the so-called “short supply chain.” But the global pandemic is just the most immediate crisis of many that we are facing, including climate change, population growth and future resource shocks. The challenge is to develop an action plan toward more sustainable food systems. In this chapter, we present the current context and issues that impact the sustainability of our food supply chain. We also delineate some of the sustainability challenges and trends and practices in food supply chain management today.

Growing Food Demand and Limits of Production

Rapid growth of world population and wealth in emerging economies means growing demand for food “and nutrition transition” or diet shifts toward high energy density foods. The world food demand is predicted to double by 2050 with a 50% increase in world population, most of which will occur in developing countries most significantly in Africa and Asia.

Growing demand for food typically means a diet with a higher percentage of added fat and sugar in processed foods, increased saturated fat intake (mostly from animal sources), reduced intakes of complex carbohydrates and dietary fiber and reduced fruit and vegetable consumption. Paradoxically, populations in poor emerging economies simultaneously face both malnutrition from food shortages and obesity from the food that is available as their food supply chains become industrialized. Table 1.1 illustrates the increase in food consumption in terms of kilocalories (kcal) per capita per day in different continents from the mid-1960s to the late 1990s with projections. The global increase is about 450 kcal ...