How COVID-19 is impacting the food-supply chain

Agriculture economists say companies are adjusting well to the way people are shopping now.

Posted: Apr 20, 2020 6:12 PM

GREATER LAFAYETTE, Ind. (WLFI) — You may notice more meats and other perishable foods fully stocked in grocery stores right now.
That's because food-packing companies are adjusting to the way people are buying.

Purdue University Agricultural Economist Jayson Lusk said a combination of panic buying and the stay-at-home order causing slower business for restaurants and other food vendors has been a learning experience for food-packing companies.

"One thing this crisis has shown us is how complicated our food system is and how well it serves us in good times," said Lusk.

Food packing-companies play a big role in the food supply chain. Lusk said the panic buying wasn't too hard to recover from, it was the shift in people making food at home versus eating out that food-packing companies had to adjust to.

"We spend about 54 percent of our food dollar away from home," said Lusk.

Lusk said with the number dropping from 54% to close to zero, many food-packing companies had to restructure its internal food chain.

"It seems like we could just easily move food from restaurants to the grocery stores but the way food gets delivered to grocery stores is in very different sizes and packaging than the way it gets delivered to us at home," said Lusk.

He said before the pandemic, there were federal laws prohibiting companies from reselling the packaged foods of one vendor to another. But the government has relaxed those rules and now people are seeing the benefits when shopping.

"We have enough supply to meet consumer's needs," said Lusk. "Prices have already started to come back down and really aren't that much different and in some cases are actually lower than prices at this same time last year."

This includes perishable foods like meats, dairies, and vegetables. Lusk said if food-packing operations continue as it is now, consumers are not expected to see a negative change in food supply during the rest of the pandemic.

You can keep up with Lusk's Food and Agriculture Blog here.

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