As a result of COVID-19, the agriculture industry, like many others, has experienced supply chain disruptions. The agriculture supply chain is critical in the world since it provides society with essentials such as produce and meat. The supply chain crisis has had a negative impact on the agriculture industry, affecting imports, exports, and raising the price of goods significantly.
Disruptions in Agriculture Supply Chain
Imports
Farmers have found it difficult to obtain supplies from other countries due to supply chain disruptions. Imports in the agriculture industry have been hindered by obstacles such as transportation, labor shortages, and bottlenecking at shipping terminals. All three of these roadblocks have an impact on agricultural imports such as crop protection, fertilizer, and farm equipment parts.
Exports
Farm and ranch profits in the United States are heavily reliant on exports. The agriculture industry, like imports, is having difficulty exporting its products. Due to a heavy reliance on ports to export food, fiber, and fuel around the world, cancelled vessel bookings, shipping container shortages, and bottlenecked cargo ships at US ports have an impact on the ability to export products to consumers.
Transportation
Moving raw materials like fresh produce has become increasingly expensive due to labor shortages and rising freight prices. Rail and truck deliveries have slowed, affecting several economic sectors. Machine part shortages are causing concern in the agriculture industry, which is impacting machine maintenance.
Packaging Materials
Since the epidemic, not only has the cost of growing produce increased significantly, but so has the cost of purchasing packing materials. Due to a shortage of products such as plastic bags for berries, nuts bags, and cardboard boxes, prices have skyrocketed. Glass, as well as canning jars and lids, are other common materials in short supply. Shortage of packing materials causes employees to seek materials from other suppliers, which can be costly and dissatisfy customers because the packaging is modified.
Priced Out Producers
Farmers are wondering if they should grow different crops to make more money for their produce as production costs go up. The cost of producing goods like crops and meats has increased since the outbreak. The agriculture industry must make decisions based on what will benefit them the most financially, learning how to best maximize profits according to price increases in the surrounding environment.
It’s difficult and time-consuming to deal with supply chain disruptions. Having a third-party partner, such as NewStream Enterprises, LLC, can help you reduce your stress and focus on the greater picture. Our team strives to improve your customer service and increase your competitive advantage. From simple to complex, NewStream has the expertise that helps you love your supply chain.
Want help mitigating your supply chain disruptions? Contact our experts today!