As supermarket shelves lie bare, U.S. agribusinesses struggle to get product from farm to table. Currently facing a significant drop in commodities prices, agribusinesses are looking to diversify their supply chain, institute new assembly line procedures and determine what effect international port closures will have on logistics long term.
Most significantly, our farms, dairies, meat processing plants and large commodities growers are facing a major supply and demand issue – but it’s not the one you think. While farmers that contract with grocery stores may be experiencing an increase in demand, others whose products were destined for hospitality, restaurants and food service establishments are throwing milk down the drain and letting perishable items rot in the fields. Getting food where it’s needed is the challenge. The result is a depression in commodities prices while food is rationed at the local grocery store level.
Poor working conditions and lack of personal protective equipment (PPE) in processing plants have made headlines recently as well, as COVID-19 sweeps plant floors that haven’t done enough to safeguard employees and the food they’re packaging.
Food that does make it off the farm or agribusiness and onto container trucks and boats, is likely to find backups at global ports. China saw stockpiles of beef and chicken at their ports during the later days of their epidemic, as they lacked the healthy labor necessary to move and distribute product into the country. Similarly, some U.S. farms and agribusinesses are affected by global supply chain disruption as exports from countries affected by the global pandemic are stalled.
Mitigate Your Risk with 6 Tips
For farmers and agribusinesses currently facing these challenges, mitigating risk is possible with the following best practices.
- Practice good hygiene and sanitation. Farms and agribusinesses can easily spread COVID-19 due to the proximity of workers in an assembly line and the nature of their work with food products. Follow social distancing and handwashing guides and have enough PPE for all workers. Set up sanitation and temperature-checking stations for employees as they come into work. Make it clear to all employees that if they’re sick or showing signs of illness, to stay home – and that they won’t be penalized for doing so. While PPE have largely been diverted to healthcare facilities, work with your local municipality to ensure you’ve got enough of a supply for your front lines employees as well.
- Consider changes to your assembly line. Since assembly lines tend to compress workers into a small space, change up the way you prepare or package products to promote social distancing on the plant floor. For example, instead of packaging bone-in chicken in 8 pieces, eliminate the need to cut the chicken, and instead package them whole. Consider other contingency options to cut down on your required workforce and eliminate workers functioning in close proximity. See FDA guidelines for food production plants safety guidelines related to COVID-19.
- Reach your employees where they are. If your workers are non-English speakers, make sure to display warnings that they can understand. For those that aren’t U.S. citizens, address their fears and uncertainties about unemployment head-on. Don’t risk them coming to work sick to avoid it.
- Remove high risk populations from your work pool. Provide employees over 65 years of age or have other co-morbidities with stay-at-home jobs when possible, or find a way to still compensate them or furlough employment, if possible.
- Research agribusiness supply chain alternatives. If you don’t yet have alternative suppliers or a contingency plan for situations like this, do what you can to put something in place now. Consider alternatives to packaging, labeling and logistics as well.
- File a claim. While most business interruption coverages will contain a pandemic exclusion, it is still recommended to process a claim if you have business interruption or contingent business interruption coverage. Make sure to track everything and include detailed documentation of losses.
Contact HUB Risk Services to learn how to develop a business continuity plan that will help protect your business and employees from the unexpected. Get the latest information, guidance and resources on Coronavirus (COVID-19) to help you protect what matters most on our Coronavirus Resource Center.