COVID-19’s role in changing the world’s supply chains in 2020 can’t be overstated. Testing supply chains everywhere, COVID-19 exposures slowed or shuttered global manufacturing. Consumers consumed differently. The virus and its consequences, like food service shutdowns, turned shoppers into online aficionados as hobbies, home improvements, in-home dining and grocery hoarding assumed new importance.
But other better-known forces also disrupted them. Geopolitical tensions shifted trade balances and important trade relationships while climate change continued to wreak havoc in global agricultural production. The Black Sea region’s extreme dryness and major storms in the U.S. counted among 2020’s examples, reworking the story from Europe and Australia in 2019.
The incremental impacts of climate change over the short term are hard to decipher and harder to forecast for a single year. With that caveat in mind, we believe these three forces will continue to dominate headlines this year as they further shift the world’s supply chains. How they’ll alter risks and opportunities for Canadian production and exports of red meat in 2021 is the subject of this post.
Canada will see more domestic and global red meat buyers in 2021
Many countries can’t produce enough to meet their domestic consumption needs. Japan, for instance, has a large population and tiny land resources. China has much more land but a massive population. As a net exporter of food, Canada produces more beef and pork than we eat. That means opportunities for Canada as a trusted, reliable supplier of high-quality red meat in 2021.
At the same time, COVID fed into a growing swell of “buying local” in 2020, a shift prompted earlier by consumers’ interest in the sources of food supplies. Canadian small businesses have taken the brunt of the economic hit during COVID’s slowdowns and lockdowns, and everywhere, the plea to keep hometown businesses alive has helped support this revolution towards local food.
Therefore, Canadian producers have two opportunities: meeting the needs of domestic consumers who want to source their food locally and, as one of the largest food exporters in the world, meeting the needs of major food importers.
Consumption and production – or how exports are made
The bubbles in the figures below highlight some of the best global opportunities for Canada. Even as different levels of global supply chains look to source more meat locally, both wealthy and developing countries still rely on imports. The location of each bubble in the charts is based on their supply and demand factors in 2019. Because those factors will change in 2021, the bubbles’ locations will also change… Read More