solutions to transportation problems in agriculture

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Real-world solutions for addressing transportation issues in 2023.

Incredible insights can often be gained from seeing what is driving success at other companies that can inspire innovation at your own.

During Greenhouse Grower’s GROW Executive Summit, which takes place next week, Dave Malenfant, CEO of MDM Consulting, will offer an interactive look at several end-to-end supply chain developments, and you can be a critical part of the discussion in this mini-workshop format tackling ideas that are working as well as areas where we can all improve.

“The costs of transportation are at the highest level we’ve seen in years, and we need to figure out how to offset that,” Malenfant says. “Even growers with their own fleets are now dealing with higher fuel costs than they’ve ever had to deal with, and that is on top of higher repair costs.”

Malenfant says moving products through and out of the greenhouse both need to be addressed.

“Route management is one of the first things you should look at, and that includes using technology to determine the best routes,” Malenfant says. “That costs money, but route optimization can ultimately help you reduce costs.”

Learn more at GrowExecutiveSummit.com .

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Greenhouse Grower is extending the opportunity beyond GROW Partners to include senior-level owners and managers, key suppliers, and advisers. GROW Executive Summit is the only venue in North America that brings together leaders across all controlled-environment specialty crop production to network, learn, and share knowledge.

Brian D. Sparks is senior editor of Greenhouse Grower and GreenhouseGrower.com. See all author stories here.

Ridder Celebrating Its 70th Anniversary in 2023

American garden rose selections names its top selections for 2024, highlights from greenhouse grower’s september 2023 issue, crop protection company envu has a new head of ornamentals, little leaf farms becomes top-selling packaged lettuce in new england.

2022 Agriculture Supply Chain Crisis Challenges and Solutions

It’s no secret that the buzz around every major industry right now is with the supply chain crisis and its continuing challenges, not the least of which is headwind inflationary pressures. A big item on the agenda at the CropLife America Conference in September 2021, supply chain issues – particularly escalating costs and shipment delays – has forced many businesses to come up with a strategy and solutions to keep customers happy and keep business profitable. With no immediate relief in sight, it’s time to admit we’ve entered an inflationary period that will impact all of agriculture. How businesses are able to adapt and respond will affect both the individual company and the industry as a whole. 

Rapidly Escalating Costs

Nearly every aspect of the supply chain is experiencing record highs—particularly freight costs driven by lack of labor availability, higher wages and higher fuel costs. This has skyrocketed the cost of inbound raw materials and outbound finished products. 

Logistics and Shipping Delays

Escalating logistics costs, shipping delays and bottlenecks have become a nightmare situation for many. Our clients are experiencing delays in acquiring their raw materials and in providing those materials to us for pilot plant scale-up and manufacturing. 

How Can We Mitigate (or Solve) Supply Chain Challenges? 

Every good businessperson will tell you that new challenges simply force honesty and discipline back into a business’ operations. It forces “good behavior” in terms of better planning and better execution. It forces companies to strive for a standard of excellence, as they should always be doing. 

By breaking apart each step in your operations processes, you can identify weak links and shore them up. The less chinks in the armor, the less room for disruption. 

Related: Factors to Consider When Formulating an Agricultural Chemical Product  

What Solutions are Being Implemented by CJB Applied Technologies? 

“By keeping in frequent contact with our customers throughout the planning and material acquisition process, we can stay abreast of possible delays and do everything we can to adapt by either speeding up or delaying their scheduled project start dates.” 

Jim Loar , CJB Applied Technologies

If the client is delayed in receiving raw materials, then there is a domino effect, pushing back product development and pilot plant production. Many of these services are perishable, and a one day delay equals a financial loss. If we understand client challenges, we can do our best to accommodate those challenges so that neither party has to experience productivity or monetary loss.

In order to partially compensate for a loss due to scheduling delay, CJB Applied Technologies is absorbing 50% of the cost of the loss per day, while the customer is asked to shoulder the remaining 50% of the cost. 

“We can’t bear 100% of the cost; it’s just too much. But we can help lighten that burden somewhat and work with customers to improve planning and communications so we can help compensate for material and scheduling delays,” Jim adds. 

He continues, “We’ve done our best to cut costs in as many areas as possible to prevent having to pass inflationary pressures on to our customers. While we have had to raise costs, like everyone, we’ve been able to keep that to a bare minimum by compensating in other areas.”

We’re smack dab in the middle of the height of this inflationary period, and it’s sink or swim for those that haven’t yet sunk. 

By implementing better processes and holding ourselves accountable to a standard of excellence, we can minimize the impact of the agricultural supply chain crisis challenges and still provide our customers what they need when they need it. 

Interested in Contract Development with CJB Applied Technologies ? Our pilot plant allows you to manufacture small batches before going to full commercial scale. Pilot plant production helps de-risk the product development process. 

Learn more about Our Process

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About the author: jonathan jakobs.

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Study of Rural Transportation Issues

This report is in response to Section 6206 of the Food, Conservation, and Energy Act of 2008 ( PL 110-246 ), which directs the Secretaries of Agriculture and Transportation jointly to conduct a study of rural transportation issues. The report reviews transportation and its effect on rural communities, with an emphasis on agricultural transportation. It looks in depth into each of the four major modes of transportation commonly used by agriculture in the United States: trucking, railroads, barges, and ocean vessels, examining each in the light of its ability to meet rural America’s transportation needs now and in the future. It identifies some broad issues that merit attention from policy makers.

• Preface (pdf)
• Full Table of Contents and Lists of Figures and Tables (pdf)
• Executive Summary (pdf)
• Chapter 1: Introduction and Overview (pdf)
• Chapter 2: The Importance of Freight Transportation to Agriculture (pdf)
• Chapter 3: How Freight Transportation Supports Rural America (pdf)
• Chapter 4: Biofuels Transportation (pdf)
• Chapter 5: Coal Transportation (pdf)
• Chapter 6: Rail Competition and its Importance to Agriculture (pdf)
• Chapter 7: Rail Rates (pdf)
• Chapter 8: Rail Service Performance (pdf)
• Chapter 9: Rail Capacity (pdf)
• Chapter 10: Rail Investment (pdf)
• Chapter 11: Rail Rate Relief Processes for Shippers (pdf)
• Chapter 12: Barge Transportation (pdf)
• Chapter 13: Truck Transportation (pdf)
• Chapter 14: Ocean Transportation (pdf)
• Chapter 15: Multimodal Issues (pdf)
• Abbreviations (pdf)
• Glossary (pdf)
• Index (pdf)
• Notes (pdf)

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Agriculture Facing More Transportation Issues with Trucking Challenges

Brian German May 17, 2021 Agri-Business , Industry

Agricultural producers are facing more transportation issues as it relates to trucking challenges. The cost of shipping has been steadily increasing over the past year. Additionally, there are reports of overall trucking shortages compounding the issue. Ag exporters have had a tough time dealing with overall transportation issues in recent months. Congestion at U.S. ports and the limited availability of shipping containers have made it difficult to get agricultural products to export markets.

The U.S. Department of Agriculture (USDA) reports that trucking rates are continuing to increase. According to the most recent truck rate report, shipping rates for getting ag products out of California to other markets were among the highest in the country. Rates for shipping lettuce and other cruciferous vegetables coming from Santa Maria are as high as $11,100 when being sent to destinations such as Boston and New York.  The rates for the same 48- to 53-foot refrigerated containers reflected a high of $10,400 less than two weeks prior.

Refrigerated spot rates for produce loads leaving the Kern District, Oxnard District, Salinas-Watsonville, Santa Maria, and the South District range between an average of $8,724 and $11,829. By comparison, the most expensive spot rate for ag products leaving California last year at this time was $6,900. USDA’s Fruit and Vegetable Truck Rate Report for May 4 takes into account various types of cruciferous vegetables, carrots, strawberries, citrus fruit, avocados, celery, and multiple types of lettuce.

All five regions of California detailed in the report are experiencing a shortage of truck availability, adding another layer to overall trucking challenges. Shortages are also being recorded in Florida and Louisiana, along with areas of North Carolina and Washington. Slight shortages are also being seen in areas of Georgia, Idaho, and Texas. Much of the shortages in truck available is due to a lack of drivers. Some of the potential causes have been listed as fears related to COVID-19, unemployment benefits and stimulus money, and competition with other job opportunities.

About the Author

Brian German

Ag News Director, AgNet West

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Update to agriculture, transportation, and the COVID‐19 crisis

Richard s gray.

1 Department of Agricultural and Resource Economics, University of Saskatchewan, Saskatoon Saskatchewan, Canada

Mohammad Torshizi

2 Department of Resource Economics & Environmental Sociology, University of Alberta, Edmonton, Alberta Canada

One year into the largest economic and health event of the past 70 years, this paper considers how agricultural supply chains and agricultural transportation have been impacted by the COVID‐19 pandemic. Written as an update to Gray (2020), we are able to show that agricultural transportation systems have proven to be extremely robust and were able to innovate in real‐time to address challenges in the agricultural and food supply chains. We are also able confirm that most of the transportation components are well‐equipped to deal with the remainder of the pandemic and the recovery phase. Notably, innovation created new services, cost‐saving technologies, safety innovations, new institutions, networks, and channels of communication that operated effectively to address the pandemic. These changes are likely to remain in place post pandemic.

Résumé

Un an après le plus grand événement économique et sanitaire des 70 dernières années, cet article examine comment les chaînes d'approvisionnement agricoles et le transport agricole ont été touchés par la pandémie de la COVID‐19. Rédigé comme une mise à jour de Gray (2020), nous sommes en mesure de démontrer que les systèmes de transport agricole se sont avérés extrêmement robustes et ont été capables d'innover en temps réel pour relever les défis des chaînes d'approvisionnement agricole et alimentaire. Nous sommes également en mesure de confirmer que la plupart des éléments de transport sont bien équipés pour faire face au reste de la pandémie et à la phase de rétablissement. Notamment, l'innovation a créé de nouveaux services, des technologies permettant de réduire les coûts, des innovations en matière de sécurité, de nouvelles institutions, des réseaux et des canaux de communication qui ont fonctionné efficacement pour faire face à la pandémie. Ces changements resteront probablement en place après la pandémie.

1. INTRODUCTION

The COVID‐19 pandemic is without question one of the largest economic and health events of the past 70 years. With a 4.3% annual contraction in global GDP (World Bank, 2021 ), economic effects were profound. As governments throughout the globe restricted travel, restricted business operations, and imposed physical distance requirements on their citizens, agricultural and food supply chains were forced to react to a plethora of new regulations and restrictions while continuing to meet the daily food requirements of 7.8 billion people. Transportation plays a critical role in virtually all agricultural supply chains. By and large, these agricultural supply chains proved to be remarkably resilient and were able to innovate, often at a breathtaking pace, to accommodate required changes in their mode of operation.

From an economic and policy perspective, perhaps the most intriguing question is to understand the processes that enabled the sector (including regulations around it) to respond to new and significant challenges and new information in almost real time. Innovations that could have taken decades to achieve in other circumstances were often made in days. This begs the question of the lessons that can be learned from both the successes and failures to address significant challenges of COVID‐19.

This article is a follow‐up to an article written a year ago titled “Agriculture, transportation, and the COVID‐19 Crisis” (Gray, 2020 ). While the previous article was written in the early days of the pandemic in very much an ex ante perspective, this article is written a year into the crisis and is able to provide more data and updates on what has transpired in the first year of the pandemic. The prognosis and forecasts put forward in the earlier paper are compared to actual outcomes indicating where there is general consistency, and where there is significant divergence between the anticipated effects and outcomes. With the benefit of additional data, we will also discuss how the agricultural and transportation sector is likely to be impacted for the remainder of the pandemic, during the recovery phase, and what changes are likely to persist in a post pandemic economy. This brief concludes with a discussion of what we have learned about policy processes that can foster rapid innovation.

2. BACKGROUND

Before addressing some of the economics, it is important to consider the enormous impact that COVID‐19 has had on humanity and to remind ourselves just how quickly the new disease outbreak developed into a global pandemic. The World Health Organization (WHO, 2021 ) describes the following series of events. On January 1, 2020 the WHO requested information on the reported cluster of atypical pneumonia cases in Wuhan from the Chinese authorities. On January 11, the Chinese authorities sent the genetic sequence of the novel corona virus to the WHO, and Chinese media reported the first confirmed death from the virus. By the end of January there were 98 confirmed cases outside of China. On February 11, the WHO officially named the virus COVID‐19. By March 1, there were an estimated 100,000 cases in the world. On March 9, the WHO indicated that COVID‐19 could be declared a pandemic. Tragically, as of February 28, 2021, 111 million people have been infected by COVID‐19 and over 2.5 million have died with the disease (Dong, Du & Gardner, 2020 ). The United States leads the confirmed death toll with over 500,000 COVID‐related deaths to date (Dong, Du & Gardner, 2020 ). Closer to home, the Canadian death toll, as of February 27, was 21,960 (Government of Canada, 2021 ). While several vaccines have been approved and are now being administered, more illness and deaths are anticipated even in the best‐case scenarios.

The pandemic was also a very large economic event in the global economy profoundly impacting GDP, personal income, international trade, and government fiscal and monetary policy. These macro‐economic effects resulted from government and private actions implemented to slow the spread of the virus while maintaining some level of economic activity. In April 2020, when Gray ( 2020 ) was written, the impacts of widespread shutdowns were being felt across the global economy, affecting heavy industry, construction, manufacturing, wholesale, retail, tourism, restaurant, and transportation services. Reflecting a dire and a very uncertain outcome between February 13th and March 23rd the Dow Jones stock index fell be 38% (Market Watch, 2021 ). Bolstered by massive monetary and fiscal stimulus, more targeted physical distancing, the development of new supply chains, the development of vaccines, many of these sectors have significantly recovered in the past 10 months, and some sectors of the economy are booming. Tech stocks related to online marketing, gaming, entertainment, home office services, home renovation, and larger ticket consumer items have seen a growth in production and demand. Of note, China was the first large economy to be impacted by the pandemic and took some extreme, and perhaps prudent measures that resulted in early containment of the virus. This allowed Chinese manufacturing to recover by mid 2020 avoiding a prolonged disruption in these supply chains. Except for a few countries, the rest of the world has been less effective in controlling the virus, resulting in a second wave of infections, and the continued use of restrictions on large gatherings, domestic and international travel, and restrictions on in‐person dining and beverage consumption. These sectors of the global economy continue to be hardest hit by the pandemic.

The disruptive economic impact of the pandemic was also very apparent in Canada and was not shared equally across sectors of the economy. Figure  1 provides an index of quarterly household expenditures in Canada for a number of food and transportation related services. While at home food and beverage expenditures increased by about 10% during the first three quarters of 2020, accommodation and beverage services dropped by over 60%. The purchase of foodservices fell 20% to 40%, perhaps indicating a shift to takeout and delivery purchases. The airline sector of the economy has likely been hardest hit, with passenger‐miles remaining down over 90% from pre‐pandemic levels (Stats Canada, 2021a ), indicating that many consumers were saying at home.

Index of Canadian household expenditures, selected items (Q4 2018 = 100)

Source : Statistics Canada ( 2021a ) Table 36‐10‐0107, Household final consumption expenditure, quarterly, Canada (x 1,000,000. https://doi.org/10.25318/3610010701‐eng

The COVID‐19 pandemic affected agricultural and food systems in very diverse ways. The necessity for consumers to eat daily meant that aggregate food demand was not greatly affected by the pandemic. This also meant the governments and industry quickly recognized the essential aspects of the food supply chains and worked cooperatively to address the supply challenges that did arise.

As Gray ( 2020 ) describes, the modern transportation of agricultural goods is dominated by trucking, rail transportation, container traffic, and bulk ocean shipping. Millions of tonnes of grain move to port by rail or truck and from port to port by bulk ocean transport. Longer hauls have some presence of intermodal containerized movement. Intercontinental trade of perishable items relies on refrigerated containers or air freight for high‐value perishable products. Short hauls from farm gate to processor, processor to food manufacturer, food manufacturer to distribution center, and distribution center to retail are dominated by purpose‐built trucks. Consumer pickup and door‐to‐door delivery services have become increasingly important in the last leg of food delivery. Each of these forms of transport has been impacted differently by the measures related to the COVID‐19 pandemic.

3. BULK OCEAN FREIGHT

Much of the grain in the world is traded via 50,000 tonne bulk ocean freighters. These large ships are typically manned by small crews that spend months of time at sea. The isolation of these crews was intensified by the shipping companies and the measures imposed by local port authorities. As a result, the supply of these services was largely unaffected by COVID‐19 illness.

As Gray ( 2020 ) noted, early on in the pandemic there was a significant decrease in the cost of these bulk ocean freight services. As shown in Figure  2 , this decrease in freight rates was short lived. By July 2020, freight rates had almost returned to pre‐pandemic levels. As also shown in the figure, these bulk freight rates movements were correlated with global steel production, which fell during the early days of the pandemic, but had returned to normal by July 2020. This price correlation is reasonable given that steel production requires large inputs of coal and iron ore, which are also shipped via bulk ocean freighters. The minimal impact on bulk ocean freight to‐date suggests that this transportation sector is unlikely to be affected by the pandemic going forward.

The Baltic Dry Index and the world steel production, January 2019‐January 2021

Source : Trading Economics ( 2021 ) Baltic Dry Index. https://tradingeconomics.com/commodity/baltic ; World Steel Association ( 2021 ) World Crude Steel Production. https://www.worldsteel.org/steel‐by‐topic/statistics/steel‐data‐viewer.html

4. RAIL MOVEMENT

Rail transportation is an essential link in the export of western Canadian grain primarily through the west coast ports in Vancouver and Prince Rupert. Gray ( 2020 ) noted that while the shipment of the large 2019 crop had been off to a slow start, the shipments had increased during the first months of the pandemic. This trend of higher rail shipments continued during the pandemic in rather a dramatic fashion. As shown in Figure  3 , total rail shipments to western ports and processors were 51.6 million tonnes, exceeding the five‐year average by 27% and the high 2019 shipments by 20% (Quorum, 2021 ). Despite record crop production, AAFC ( 2021 ) is forecasting a 2.6 million tonne reduction in the ending stocks of all principle field crops.

Rail movements of grain to western ports and processors, 2015‐19, 2019, 2020

Source : Quorum Corporation ( 2021a ) Table 2B‐1 M, Western Canadian Destined Railway Traffic, Western Ports and Western Domestic (thousands of tonnes). http://grainmonitor.ca/reports.html

These record levels of grain rail shipments were enabled by three factors: the production of a large crop; grain terminal expansion and infrastructure in the port of Vancouver (Torshizi and Gray, 2018 ); and rail investments in locomotives new, high density hopper cars (Siekierska, 2018 ). As shown in Figure  4 , like ocean freight, grain movement could have also benefited from reduced rail demand from other sectors, freeing up crews and locomotives for redeployment to the movement of grain. Irrespective of the causal effects, rail grain movement during the pandemic set new record highs, reflecting a higher capacity to move grain. Going forward, the greatest risk to the rail transport of grain would appear to be a post pandemic boom in the shipment of other goods that would make the railways less able to respond to unanticipated increases in demand. In the past, this has led to congestion and higher grain export basis level (Torshizi and Gray, 2018 ).

Railway carloadings by total tonnage transported monthly, 2015‐19, 2019, 2020

Source : Statistics Canada ( 2021b ) Table 23‐10‐0216‐01, Railway carloadings statistics, by total tonnage transported, monthly. https://doi.org/10.25318/2310021601‐eng

5. MARINE CONTAINER MOVEMENT

Marine containers are increasingly being used in agricultural supply chains, connecting buyers and sellers with secure segregated shipments of products from seller to smaller purchasers around the world. As shown in Figure  5 , total container‐based grain exports have grown to 6 million tonnes annually, dominated by lentil, pea, and edible soybean exports. Given the quantity of production, containers are an important mode of transport for these crops.

Total grain exported in containers 1 Source : Quorum Corporation ( 2021b ) Table 2C‐3, Total Grain Exported in Containers (thousands of tonnes). http://grainmonitor.ca/reports.html

Figure  6 reports monthly shipments of grain in containers in the past four calendar years. Like other grain exports, container‐based exports of grain increased during the pandemic, suggesting that container movements were positively impacted by the pandemic.

Grain exported by container by month (tonnes) 2017‐2020

Source : Quorum Corporation ( 2021b ) Table 2C‐3, Total grain exported in containers (thousands of tonnes). http://grainmonitor.ca/reports.html

In November 2020, Nicholson ( 2020 ) reported a shortage of empty marine containers available for grain export for the Port of Vancouver. This scarcity of empty containers occurred when the container shipping companies put out an urgent request to “immediately evacuate” empty containers for shipment to Asia so they could be reloaded with high‐value Asian goods for shipment to North American during the Christmas season (Hemmes, 2021 ). As shown in Figure  7 , this action is evident in the data showing a surge in both outbound empty and inbound laden container movement, in the last few months of 2020. Fortunately, the reported container scarcity did not result in reduced container‐based export of grain which continued at a record pace in the last four months of 2020. On a calendar year basis, the 2020 exports of 6 million tonnes exceeded the previous record 2019 shipments by more than a million tonnes.

Outbound empty and inbound laden container traffic, Port of Vancouver, 2020

Source : Port of Vancouver ( 2021 ) Container statistics report, 2008 to 2020. https://www.portvancouver.com/about‐us/statistics/

The reports of container shortages do identify a vulnerability in the access to markets, which could become an issue if there is a post pandemic economic boom in overall container demand. For a growing number of high value markets there are no good alternatives to containerized movement. Captive buyers and sellers will have to build additional risk premia into their transactions with negative price consequences for grain producers and for industry development. Going forward, this vulnerability may need to be addressed through new supply chain relationships and/or other means.

6. TRUCKING SERVICES

As Gray ( 2020 ) describes trucking services are vital linkages in many parts of the agricultural supply chains. Recognized as being vital to food supply chains trucking services were not subject to regulated closures but were subject to physical distancing protocols to protect employees and their customers. The protocols for the pick‐up and delivery of farm inputs, farm produce, and intermediate or final processed goods to grocery distribution centers were quickly modified so that they did not require a trucker to leave the safe confines of their truck.

With the minor regulatory changes, the trucking sector, by and large, has been able to meet the demand for trucking services during the COVID‐19 pandemic. A combination of factors may have enabled the trucking industry to meet the changing demand within the agriculture and food supply chains. A decentralized industry structure enabled a number of decision makers and markets to play a role in trucking service procurement. The solitary (or two) driver nature of truck operation reduced the risk of workplace spread. Finally, the decrease in demand from other sectors freed up trucking resources that could be redeployed to agricultural and food supply chains.

Early in the pandemic, the closure of roadside restaurants limited trucker access to restrooms. In rapid response to this issue many provincial governments installed portable toilets at trucking weigh stations. Government also relaxed and increased the maximum distance and time limits for drivers, to reduce the need for driver change and accommodation use on longer hauls. While truckers were exempt from some of the restrictions on international travel, they were in general subject to modified testing and quarantine protocols, which increased the cost international trucking services.

Going forward there is little reason to anticipate any major issues related to trucking that the market will not solve. Perhaps the more isolated nature of the job, brought about by physical distancing and quarantine requirements during the pandemic, could reduce the supply of drivers, requiring a higher wage or other measures to offset.

7. HOME DELIVERY

As shown in Figure  1 , the pandemic had an extreme impact on food consumption habits. In the second quarter of 2020, the purchase of food services dropped 40% while grocery expenditures increased by 10%. While this recovered somewhat in the third quarter when the COVID‐19 numbers decreased, renewed shutdowns during the second wave may have intensified the shifts away from in person dining. These measures could also underestimate the shift to home delivered meals and takeout food.

The pace at which the food industry has been able to innovate to meet customer needs is certainly unprecedented. The home delivery market, which was already growing, exploded during the pandemic. Based on the revenue of traded home delivery companies, the 2020 industry revenue was 4 times the 2019 annual revenue (Curry, 2021 ) and this figure would not include the restaurant‐owned food delivery service.

While in person shopping continued, there was also a large shift toward grocery pickup and delivery. While initially these services were limited in supply and required ordering over a week in advance, the ques shortened as the supply increased. Most major grocery retailers now offer online ordering with store pick up and grocery delivery service. In its 2020 annual report, Loblaws reported $2.8 billion out of their total $51.86 billion retail sales were online sales, up 178% from last year's online sales (Redman, 2021 ). General online retailers like Amazon Fresh have also entered the space, as have specialized delivery services like Uber Eats. The pandemic forced retailers to quickly innovate or be left behind. This growth in these on‐line services will understate the reduction in the number of persons shopping as many families sent fewer people to the grocery store, made larger less frequent purchases, and purchased groceries on behalf of COVID‐19 vulnerable friends and relatives, who did not want to risk shopping exposure.

Gray ( 2020 ) recommended subsidizing food delivery. However, governments did not move to directly subsidize grocery pickup or home delivery services, perhaps because this need was addressed by the market, and perhaps because public health authorities did not find that grocery shopping was a significant vector for COVID‐19 transmission when physical distancing protocols were followed.

While many online shoppers may return to the store once the pandemic is over, they have also already incurred the sunk cost of learning how to use online delivery and may continue to use these services for their convenience. Given that food consumption patterns tend to be habit‐forming, the effects of the pandemic are expected to persist beyond the pandemic, permanently impacting food consumption habits. This will be especially true in geographies where restaurants have gone out of business.

Price‐conscious shoppers may also continue to use online shopping as a means to quickly search for the best deal in their district. In any case, the end of the pandemic will almost certainly reduce the demand for these online services in the short run, as more consumers travel and return to restaurants. This reduction in the demand could create a period of intense competition and where the capacity to serve the market exceeds demand.

8. POLICY IMPLICATIONS

The COVID‐19 experience demonstrates that if industry recognizes that change is necessary and inevitable, it can innovate very quickly. In February 2020, the term social distancing , soon to know as physical distancing , was a new concept. Three months later, nearly every business and every person had made substantial changes in the way they operated. Governments were simultaneously learning about a new pathogen, introducing regulations, and developing public messaging to prevent a public health disaster from an overwhelmed health system, while reacting to and designing radical new policies and programs to deal with the economic fallout of the health measures. Business owners and public and private employees had to change how they operated, as they collectively took actions to reduce health risk while considering social needs and the economic consequences of their actions. The agriculture and food sector was profoundly challenged with the need to continue to feed the world on a daily basis despite the wide‐spread closure of restaurants and the changing operating practices at every point in the supply chain. Thankfully, the sector was able to respond to the enormous challenge, with relatively few COVID‐19 related deaths and very few incidences of food shortages.

One could argue this was the invisible hand of the market operating effectively, but that would drastically understate the contribution of millions of Canadians, who recognized their social responsibility and made uncompensated efforts to dutifully do what they could to address the crisis. Governments, from senior politicians to the public servants delivering vital services, recognized the crisis and put solutions ahead of their self‐interest. Often, collective action provided pragmatic solutions to potential disputes up and down the supply chain allowing the sector to continue to operate in a new reality.

New processes were put in place to identify new issues as they arose with an expectation that solutions would be discussed, and the best available knowledge and management practices would be shared to find a pragmatic solution. While most businesses and public institutions put these processes in place internally, governments and industry organizations created new processes for information sharing, consultations and decision making. The AAFC COVID‐19 Industry‐Government Working Group was created and met regularly after March 24, 2020. The initial invite went out to 886 recipients in the agriculture and food sector and covered from the food retailer to farm input suppliers, provincial government officials, producer organization, etc. Attended by the Minister of Agriculture, senior AAFC officials, government officials from across the federal government, provincial governments, NGOs, private firms, and industry leadership from across Canada, the committee was a vital conduit for rapid decision making. At each meeting the industry was made aware of rapidly changing regulations, policies, and programs. Industry leadership identified both new and persistent issues. Practical and pragmatic solutions were often discussed. The Minister of Agriculture regularly attended, solicited, and fielded questions from the working group. Ministerial officials provided weekly updates and reported on progress toward solutions. With the importance and urgency of responding to the COVID‐19 pandemic, the open committee mechanism allowed new problems to be addressed often within days or a few weeks of being identified, clearly demonstrating that very rapid innovation is possible. For example, about 2 weeks after committee members raised concerns over the impact of travel bans on temporary foreign workers, the government announced (on March 27, 2020) to the committee travel exemptions for travel of temporary foreign workers, with a long list of new safety protocols and employer requirements, to be eligible for the program. The committee continues to meet about twice per month. Hopefully, the positive experiences from this process have a lasting impact on industry‐government communication and perhaps reset the clock on the expected timelines for governmental decision making and industry innovation.

9. CONCLUSIONS

There were relatively few apparent issues related to agricultural transportation systems. Early on, trucking issues related to toilets, border crossings, and long distance were quickly addressed though policy change. New protocols to maintain physical distancing were quickly developed and implemented by firms at virtually every link in the transportation chain. As noted earlier, the agri‐food transportations systems preformed exceedingly well, in some cases setting records for the volume of movement.

All parts of the agricultural and food industry were focused on finding solutions to new challenges created by the COVID‐19 pandemic. The unprecedented rate of innovation required new planning processes, institutional arrangements, and communication channels, which were accepted and supported by individuals and an industry determined to find solutions.

The resilience of the agri‐food value chains to provide continual supply of safe food during the COVID‐19 pandemic is an indicator of the robustness of the sector. This optimistic assessment may also understate some underlying issues of the food security (Deaton & Deaton, 2020 ) that could not be addressed in this paper. The pandemic disrupted employment, public transportation, pedestrian and closed public schools, perhaps having large negative impacts on those with ongoing food security issues. As we measure and report the tremendous innovation and the robustness of the agri‐food value chains in Canada, the enormous hardship created by the pandemic should not be understated.

Gray, R.S. , & Torshizi, M. Update to Agriculture, Transportation, and the COVID‐19 Crisis . Can J Agr Econ . 2021; 69 :281–289. 10.1111/cjag.12280 [ CrossRef ] [ Google Scholar ]

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Food/Ag. Industry Still Facing Supply Chain/Transportation Problems

Date :  Tue, 03/28/2023    Broadcast: 03

Remark :  The U.S. farm and food industry is still being challenged by transportation-related supply chain problems. (Gary Crawford and Agriculture Secretary Tom Vilsack)

Duration :  00:00:58.958

Author :  GCRAWFOR

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5 Key Issues in Agriculture in 2021

Photo Credit: Maria Fleischmann/World Bank

As 2021 ends, we take a retrospective look at five topics that were covered in our analytical work this year. These issues represent just a fragment of the Bank's work, but they are key to reducing poverty and hunger while slowing climate change.

Food Security

Like the previous year, news in agriculture and food in 2021 was dominated by deteriorating food security. Approximately 30 percent of the world’s population lacked access to adequate food in 2020 and into 2021.

The World Bank took action to fight food insecurity around the world, providing immediate aid to vulnerable households and more long-term support to farmers in the form of seeds, fertilizer, and other agricultural inputs.

COVID-19 also pushed more people into poverty and made the poor poorer around the world. This, along with supply chain interruptions and rising prices had a major impact on hunger. To learn more about these impacts, read this brief compiled by the Bank and updated at least once a month.

Our new podcast series, Table for 10 Billion , launched in March examined the causes of growing hunger and offered some surprising answers.

Farming Insects for Food and Feed

This December, the Bank released a ground-breaking report looking at the valuable role farming insects can play in both food security and climate-smart agriculture, Insect and Hydroponic Farming in Africa: The New Circular Food Economy .

While two billion people regularly eat insects harvested in the wild, farming them for food at scale is new. The report found that African insect farming could generate crude protein worth up to US$2.6 billion and biofertilizers worth up to US$19.4 billion. That is enough protein meal to meet up to 14% of the crude protein needed to rear all the pigs, goats, fish, and chickens in Africa.

Key benefits of insect farming include:

• Insects can be farmed without arable land.
• Insects can be grown within a couple of weeks.
• The food they need to grow comes from food waste.
• Insect waste can be used as fertilizer.
• Insects can be used as animal feed, cutting farmer expenses, and reducing greenhouse gases generated from farming and transporting other feed such as soybeans.
• People can eat insects or sell them for income, increasing food security.

For more on farming insects and the role they can play in the food system, take a listen to this episode of the Table for 10 Billion podcast .

Fixing Food Finance to Build a Greener Future

While agriculture currently accounts for about 25% of greenhouse gas emissions, it also offers opportunities to both fight climate change and feed more people as the world’s population grows to 10 billion people by 2050. One of the keys will be changing the way agriculture is financed and incentivized .

A report from the Bank, published in September, explains the US$12 trillion in annual hidden social, economic, and environmental costs generated by our current food system and offers recommendations to break the cycle by implementing five food finance imperatives that will help implement climate-smart agriculture .

The report, Food Finance Architecture: Financing a Healthy, Equitable and Sustainable Food System , was written in conjunction with the Food and Land Use Coalition, and the International Food Policy Research Institute, and released to coincide with the UN Food Systems Summit.

A feature story and episode of the Table for 10 Billion podcast examine transforming the food system to adapt to climate change.

Digital Agriculture and the Path to the Future

Agriculture continued its march to the digital future in 2021, both with new techniques being developed for growing food and technology that better links the world’s 570 million farmers and 8 billion consumers.

In March, the Bank released the report What’s Cooking: Digital Transformation of the Agrifood System , which explores how digital technologies are improving the food system and provides a roadmap for countries to scale up their own digital agriculture. The report also provides a framework to evaluate policy proposals that can make the food system more efficient, equitable, and environmentally sustainable.

A live event was held in conjunction with the report’s release and the Table for 10 Billion podcast also looked forward to the digital future of food.

Feeding Growing Cities

In March, the Bank looked at the fast-growing cities of Asia and how they have integrated food systems into their planning. The resulting report, RICH Food, Smart City , demonstrated that more needs to be done at the planning stages to ensure a plentiful and safe supply of food to residents now and in the future.

Only 8% of the 170 emerging Asian cities surveyed by the Bank and FAO were deemed to be “food-smart”–working proactively to ensure strong food systems.

As was made clear by the disruptions caused by the COVID-19 pandemic, it is key for cities to pursue “smarter” food policy in order to foster reliable, inclusive, competitive, and healthy (“RICH”) food systems better aligned with their challenges and aspirations.

The authors of the book sat down to answer questions on what needs to be done and how to do it.

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Meeting The Challenges Of Transporting Produce

Best practices are inexpensive to implement, yet result in greater efficiency throughout the supply chain.

IT'S THE BEST of times and the worst of times for the produce industry. First the good news: Americans are focused on eating healthy meals nowadays. Reducing consumers' collective waistline and fending off illness through proper diet has prompted many people to eat better. And that includes more fresh fruits and vegetables.

Now the bad news: Health scares today include potential tampering with produce shipments as well as dealing with e coli and related threats. There is also a small but growing movement to "buy local." Such a practice falls in line with the goal of sustainability because less energy is used to transport produce from distant states to local grocery stores; for example, from California or Florida to New York and New Jersey.

While shippers of produce benefit from the good news, they really can't solve all of the issues of the bad news. But they can do their part to improve the industry by tuning up the supply chain.

"I think the keys to success in the supply chain are communication as well as the effectiveness and efficiency of the value chain," says Bud Floyd, vice president of marketing for Perishable Business at C.H. Robinson Worldwide Inc., a third-party logistics (3PL) company in Eden Prairie, MN.

"We need to have open architecture as it relates to system visibility that I can see end to end-not deal with just one element of the value chain, but all its opportunities."

To provide guidance for greater efficiency in the supply chain, the transportation task force of the Produce Marketing Association (PMA) has released a report on Best Practices. It is a roadmap to improvement.

And improvement is certainly needed throughout the supply chain. Today's challenges range from a communications gap and scattered distribution patterns to loading and unloading inefficiencies.

Communications Gap

The communication gap that currently exists is both an internal and an external one. The trend is to have fewer employees perform more tasks outside their area of expertise, resulting in internal disorder. In the worst cases, employees compete against one another through the lure of bonuses and incentives that do more to create friction rather than harmony.

When goods are shipped, experts say there is sometimes a "get it done quickly" mentality among workers to meet the timetable of the receiver. Another attitude: "If it doesn't affect me, it doesn't affect my organization." Sloppiness is surely to result and a lot of finger pointing (unsupported by facts or data) takes place when issues arise further down the supply chain. This domino effect does little to foster a spirit of cooperation between partners.

Floyd maintains that adding to the breakdown are the habits of those at the top; namely, buyers who do not communicate their activities to other buyers. Most do not currently operate their systems online, compounding the problem even further.

In a typical scenario, one company might have three pallets of product to ship while another has five pallets of something else that's fully compatible. Both are unaware of this fact, allowing the potentially overlapping products to find their way into stores on separate trucks.

In a traditional grocery situation, buyers not typically located at the distribution centers use transportation brokers, explained Michael Coonan, group logistics manager for Ryder System Inc., a Miami-based provider of transportation, logistics and supply chain management solutions. Their job is to find independent trucking operators who are based in the area of the produce to load and haul the goods.

The problem that occurs is that remote produce areas are challenging to service and there are usually few loads going back into the area. Seasonal growing in these areas also contributes to inadequate trucking capacity.

As for improvements, experts say organizational transparency can go a long way. Ideally, the entire operation should be an open book, including a full explanation of all profits in place. Furthermore, the last six months of shipping information-by lane-should be readily available to assess opportunities as well as uncover new and different solutions. But as it stands, many organizations do not have sophisticated solutions that can extract knowledge from data.

Another weak point addressed by Floyd is that organizations are not well-rounded enough. Their systems may be good on one side because that's their true competency and what pays the bills from warehouse to store. But on the other side, getting a product from A to B, they might not have invested enough capital to upgrade their proficiencies.

Communication between customers is another area that must be strengthened, according to Floyd. There should be in place specific definitions on a customer basis of what is expected regarding delivery times.

"I'll ask a customer, ‘How do you define on time delivery?' They might say within 24 hours of the (expected) time. Another customer might define it plus or minus two hours, or plus or minus 30 minutes," he explains.

Inefficient Distribution Patterns

"Education begins with awareness," says Floyd. "Efficiency as it relates to fuel and local sourcing will be more in the forefront. Information should be readily available for our company to assess best methods of moving goods."

Terry Humfeld, vice president of volunteer leadership relations for PMA, sees LTL (less-than-trailer load) situations as a constant challenge. When drivers are being asked to visit three or four locations on the West Coast to get their trucks full before they start heading East, there is a significant amount of man hours wasted.

Taking produce as an example, the PMA task force suggested that the various category managers work together in creating visibility internally to consolidate loads throughout the operation. Having good software programs is the key to fulfilling this goal.

The "forward consolidation center" is a relatively new concept that is gaining popularity. With this system, full truck loads from California, for example, could be transported into a facility in Kansas City. Those loads are then cross-docked and sent off to their intended destinations. This is one way companies can alleviate inefficient distribution patterns.

Loading/Unloading Inefficiencies

Inefficiency problems in loading and un-loading come down to defects in process, notes Floyd of C.H. Robinson. This encompasses the time an order goes in, the lead time the order has, the metrics used in evaluation, and the necessity of having full visibility.

Understanding the appropriate lead times for each product and adhering to them is the goal. If you don't have the appropriate lead time but you set a truck in place and it arrives at the shipper's location, it might sit for five hours to wait for that product to be processed.

"Drivers are paid to drive and we need to keep them on the road," says Humfeld of PMA. "Fancy names like ‘dwell time' are sometimes used, but any time they are sitting in a parking lot it is wasted time."

Externally, experts suggest that there's a lack of understanding of real expenses in the supply chain. If a driver waits for three hours before the product can be unloaded, at a cost of $70 dollars per hour, that's $210 that someone in the supply chain must absorb. Not to mention the loss of the carrier who could have used those three hours elsewhere.

On the subject of rejected product, Humfeld says that "in most situations, it's not the driver's fault. There's no reason to unduly delay them on their way to the next assignment."

Unfortunately, this happens all too often.

"Coordinating with the field-to-market process is a major undertaking," explains Coonan of the Ryder Group. "Delay times at origin can be caused by weather and impact a grower's ability to get the produce harvested to meet orders. Produce trucks that are delayed at origin contribute to missing scheduling opportunities."

Proper Temperature

"We believe there are four steps to the safety of perishables: the product needs to be pre-cooled properly, the trailer needs to be pre-cooled properly, the trailer needs to be loaded properly and you need to maintain proper temperature during transit," says Elizabeth Darragh, director of supermarket and food strategic marketing for Sensitech Inc., a Beverly, MA-based provider of cold chain monitoring instruments, information and analysis.

Although the steps are simple, they aren't always followed. Product sometimes sits on the dock while other times the refrigeration gets turned off in the trailer. To cut costs, an excessive amount of pallets are being crammed into trailers which can result in damaged goods.

Why does this happen? According to Darragh, there is an overall lack of education on the subject, sprinkled with too many shippers maximizing loads to the point where the safe arrival of goods is thrown into risk. Too often those involved believe that they'll "never get caught" if an issue arises further down the supply chain.

Produce is unique, she says, in that it may not look like it's been abused when it gets to the distribution center. It should be made common knowledge by all those involved that there is an important relationship between time and temperature. Darragh stresses that every time the balance is upset, shelf life decreases.

So it's not surprising that recent national surveys show that many consumers are not happy with the taste of produce. Retailers need to collaborate closely with suppliers in delivering better quality from field to the store. When fruit is being shipped from California to the East Coast, the habit of trying to stuff as many crates as possible into the trailer often endangers quality.

There is considerable public concern these days about the danger of E. coli bacteria. With fresh produce, there is no method of killing it, as there is with meat. Since consumers are already critical of produce selection, coupled with their heightened fears of getting sick, proper handling techniques become all the more necessary.

The bottom line is that shippers must be taken to task for the quality of produce. Companies like Sensitech work with supermarkets to monitor both shipments and temperature recording devices. This helps to further cement a symbiotic relationship with the suppliers in their quest to deter spoilage.

"This trend has become a strong one in the last five years," Darragh reports. "Chains want us to monitor every trip to the store. They want to see how well their suppliers are performing."

Coonan of Ryder System sees improvements occurring simply by "grocers partnering with a reputable and flexible dedicated carrier that is acutely aware of their needs and how to service them."

A key component is making sure both the shippers and receivers are communicating their expectations to the transport companies in terms of how those loads should be handled. Transport companies must use temperature monitors.

"The supply chain has a clear responsibility in fulfilling all the post-harvest requirements of the product and that includes keeping cold temperatures if need be, or just holding the produce at the proper temperatures," explained Humfeld.

Bottom line: Best Practices will only work if the industry adopts them.

PMA's Best Practices Offer A Roadmap To Improvement

The Produce Marketing Association (PMA) created a transportation task force in 2005 to identify and analyze transportation issues impacting the produce industry. It has developed steps that suppliers and receivers can take to ensure the proper delivery of produce. They are included in a document of Best Practices for suppliers and receivers.

According to PMA, many of these best practices are inexpensive to implement, but will result in greater efficiencies and lower costs throughout the supply chain.

Here is a summary of the general recommendations:

1. All members of the produce supply chain approach transportation issues and disputes with an understanding of the impact on the business customer.

2. Shippers and receivers engage in collaborative sales and operational planning to better cope with supply and demand management issues.

3. Supply chain efficiencies are maximized when there is a clear, ongoing communication between all parties.

4. Pallet requirements negotiated between the shipper and the receiver rather than assuming that carriers will be responsible for acquiring and/or disposing of pallets.

5. Supply chain partners (shipper, carrier and receiver) agree to service level metrics and expectations prior to moving a load or, in the case of an ongoing business relationship, periodically review a scorecard of service level metrics and expectations.

6. Shippers and receivers strive to build loyalty, confidence and trust with carriers by addressing relevant environmental factors.

7. The Bill of Lading contains necessary information.

8. All supply chain partners need to understand, as well as comply with, the requirements of the US Bioterrorism Act of 2002.

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How does transportation affect agriculture? What are the problems associated with it? Elucidate.

Topic:  Major crops-cropping patterns in various parts of the country, – different types of irrigation and irrigation systems storage, transport and marketing of agricultural produce and issues and related constraints; e-technology in the aid of farmers.

5. How does transportation affect agriculture? What are the problems associated with it? Elucidate. (250 words)

Reference:  Indian Geography by Majid Hussain

Why this question: The question is straightforward and is from the static portions of GS paper III. Key demand of the question: The question aims to analyse the important role played by transportation in the agriculture sector and the issues associated with it. Directive: Elucidate – Give a detailed account as to how and why it occurred, or what is the particular context. You must be defining key terms where ever appropriate, and substantiate with relevant associated facts. Structure of the answer: Introduction: Briefly quote the significance of transport in the agri sector in general. Body: When analyzing transport of agriculture produce, it is identified that transport costs has critical role in recognizing the link between accessibility and agricultural development. Good transport system is critically important to competent agricultural marketing. For distribution of agriculture produce, road transport has vital role because it is the major means of transporting agricultural produce from the farms to the markets as well as to various urban communities. It is the only means by which food produced at farm location is transported to different homes as well as markets. Transport creates market for agricultural produce, improves interaction among geographical and economic regions and opens up new areas to economic focus. Explain the associated concerns or challenges. Suggest what needs to be done to overcome it. Conclusion: Conclude with way forward.

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Transportation issues and the risk for smallholder farmers

May 13, 2020

Sub Saharan Africa, including Nigeria, has some of the highest food losses in the world, mainly due to problems with post-harvest storage and market linkage. Market linkage consists of many elements but a key one is transportation. Given current COVID-19 related measures, it seems clear that transportation is facing severe challenges. An already existing high level of food loss and severe transport issues is not a good combination, particularly for Nigeria’s smallholder farmers and transporters.

Interviews with transporters suggest that there currently is a severe time and cost increase for intra-state movement of goods.  BusinessDay previously reported this on April the 27th. More recent data unfortunately show the same trend. Some north to south destinations still show an almost 100% increase in travel time.

To fight COVID-19, border checks and other measures that limit the movement of people need to be enforced. At the same time, these measures should not cause any unnecessary problems for people, particularly the poor. Right now, however, it seems to do just that; transport originated in the north seems to be harder hit and at the same time the larger part of smallholder farmers in northern states, already before COVID-19 live below the poverty line, according to the report on poverty by the National Bureau of Statistics.

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Agricultural transportation in the north is also less formalised than transportation originating from the South West, and therefore likely less resilient. So, the added time and cost for transport could end up directly reducing the farmers’ income, either less produce gets sold or the transport cost lowers the revenue. Added time will also affect the driver/owner of the trucks ability to earn money.

There is therefore an imminent need of finding ways to secure smooth cross border transport. Securing a more stringent protocol for the border staff is likely a good start. Safeguarding minimal disruptions in travel time should at least not increase the food losses and lower the burden on smallholder farmers and the transporters.

Something in the air

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