It didn’t take long in the first COVID lockdown in Australia for toilet rolls to disappear from supermarket shelves.
Although 4 billion people worldwide do not use toilet paper, Australians deemed loo paper an essential service. They also forgot that there is sizeable local manufacturing, meaning supply was unlikely to be disrupted.
Instead, they bought up big.
Toilet tissue is a bulky item and takes up valuable real estate on the shelves of aisle 15. Stock controllers work out the daily turnover and rely on the normal purchasing behaviour of customers to order in enough to keep the shelves full, just in time. Standard supply chain procedure optimises the number of deliveries to each store to avoid missing a sale.
Only people panicked.
They decided that toilet rolls were not just essential but ‘OMG, what would happen if we ran out?’
The panickers bought double, three or four times the amount that they would typically buy in a week and, in an instant, the shelves were empty.
Terrible scenes of people hoarding, five, six packets, even trolleys full of the stuff with old folk going without and asking politely for just one pack — some individuals’ selfishness was caught on video for all to see.
Food supply shortages
At the start of 2021, the UK was braced for a toilet roll situation, only this time with food supply as well as household consumables. Border changes from Brexit produced vast queues of lorries in and out of ports.
According to the UK Department of Environment, Food and Rural Affairs, almost half the food eaten by the 60 million people in the UK comes from overseas. Others report that it might be 80% depending on whether it is tonnage or value, processes or raw.
Based on the farm-gate value of unprocessed food in 2019, half the UK supply was grown locally (55%), and the EU countries provided a quarter (26%) with Africa, Asia, North and South America making up the rest of food consumed. Remember that this is food for a population of 67 million people that need 146 billion kilocalories a day.
The three largest value imported commodity groups were fruit & vegetables, meat and beverages.
Delays at borders mean one of two things.
There is enough storage capacity to buffer any wait time, keeping food on supermarket shelves at the usual rate. There has been no need to invest in this capacity up to this point, and the market does not spend money on unnecessary services. In the absence of storage buffers, delays result in shortages.
When the supply chain dynamics change, in this case, due to a political agenda, in the Sydney toilet roll debacle due to a health shutdown, there’s a high risk of panic buying.
Reliance on the supply chain
There are several realities here.
Society relies heavily on supply chains. Almost all the people in mature economies shop for their food.
Intrepid green-fingered types grow a bit here and there, but most people exchange money for food. Every person is reliant on a secure food supply.
We take this situation for granted, and governments work hard to ensure that food is readily available because they don’t want it to fail on their watch. Failure is likely to get them ousted within an instant.
Supply chains are fragile like a wine glass is fragile. It doesn’t take much for a market-driven system to break.
Each link in the food supply chain is optimised to maximise profit. Market forces define the system’s efficiency within the constraints of individual efficiencies, available investment, and organisational capabilities.
Markets optimise transfer (trades) rather than stability and resilience.
Consequently, there’s little storage capability and limited buffer should the system be interrupted. The level of turnover in warehouses is remarkable. They are just temporary storage with goods moving in and out rapidly. No money is made if goods sit on warehouse shelves.
The system is insecure because of design rather than physicality, which always looks complex and technical.
Food production security
The production end, how food is grown, is the natural focus of food security. Consumers can’t eat unless the food is grown. It is essential to convert biomass potential into edible products or the chain stops before it even starts.
But the supply chain itself is critical to food security. And how that supply chain delivers resilience rather than profit is where security will be gained or lost.
Should the supermarket run out of bananas, what will the minions eat?
Most likely, CIVID and Brexit issues are temporary problems. Politicians and the market will run around quickly to fix any market failure. And so the likelihood is that food supply is restored soon enough.
In the meantime, there will still be something to eat on the shelves. Even if it’s packet noodles.
So starvation won’t be the issue, at least not in mature economies. But the level of disruption and the triggers to basic instincts are huge.
There will be fisticuffs in the aisles.
What sustainably FED suggests…
Keep an eye on the food supply chain.
How food gets to your plate from the farm is just as important as what the farmer does to grow it.