Shane Brennan, Chief Executive of the Cold Chain Federation, examines the immediate priorities for the food cold chain as it navigates the Covid-19 pandemic.
For many of us the Covid-19 restrictions have shone a light on some of the essential things around us that we often take for granted. The UK cold chain is an entire industry that is often overlooked, but it is the crucial link storing and moving fresh and frozen food between farms, processors and manufacturers to shops, restaurants, schools, hospitals, and homes. It keeps food safe, minimises waste and fulfils a vital role throughout the whole food supply chain.
During the Covid pandemic we have seen some parts of the food and drink industry go into hibernation while other businesses have seen dramatic increases in demand. Serving both these extremes, cold storage and temperature-controlled distribution businesses have navigated major upheaval. Orders have been changed sometimes by the hour, reefers have bottlenecked in China and operations have required swift changes to maximise social distancing. Cold storage filled up with goods that had nowhere to go, while temperature-controlled distribution saw vehicles parked up with no orders to fulfil.
Government’s decision to defer VAT payments and the Coronavirus Job Retention Scheme have helped many cold chain businesses, but they have nonetheless faced cash flow disruption, fears of bad debts and the difficulty of changing operations quickly, as well as the need to both manage and support their workforces in this rapidly changing, unpredictable situation. But the industry is resilient and the cold chain has been both dependable and flexible in serving its customers throughout.
Now that general movement restrictions have changed to targeted ones, we must prepare for several different possible pandemic scenarios. We all hope for a vaccine or treatment and that the food supply chain will return to previous levels and working relationships. But the food chain must plan for the possibilities of extended suppression measures, or even a second wave, and stay primed to react fast as the picture develops.
As restrictions have lifted gradually, sectors previously in hibernation such as food service and airlines have been able to start operating at reduced levels. But this is alongside continued social distancing and international travel restrictions, uncertainty about schools and universities returning to normal and signs of some reluctance from consumers to return. Like their food chain partners, cold chain businesses must continue to interrogate their expectations for orders over the coming months. Identifying where reduced demand is anticipated, and from where new customer orders for the storage and movement of chilled and frozen food could come, are high priorities.
High demand for online shopping and last mile deliveries are changes prompted by the pandemic that we can expect to continue indefinitely. According to Kantar, online shopping attracted more new shoppers in 2020 than it has in the previous five years. Demand for home deliveries has far exceeded what the groceries sector has capacity to supply, even with the impressive capacity increases that have been made. Businesses which could adapt their operations to help meet demand for food deliveries can consider whether this may help them to partly off-set losses in other areas.
Preparing for the next phases of the Covid pandemic must go hand in hand with preparing for the changes that will come as the Brexit transition period ends on 31 December. With the possibility of added cost and time for every consignment exported or imported, not to mention anticipation of teething troubles with new paperwork, new infrastructure and new personnel, we should be alive to the possibility of major changes across the food chain over the next twelve months and far beyond.
Whether we will eventually return to pre-pandemic cultures and attitudes or forge a ‘new normal’ remains to be seen. The Cold Chain Federation will continue to provide advice and support to its members and ensure the cold chain’s voice is heard by politicians and policy makers alike.
The cold chain has proved its mettle throughout the Covid-19 crisis and the fundamentals that made it a strong, dynamic and innovative industry as we started 2020 remain. I look forward to working with cold chain businesses as they are able to refocus, when the time is right, on plans for continuing the industry’s growth long into the future.