Putting bread on the table: How Canada can protect our food supply chain

Access to food is an essential need and a human right. People speak about working to “put bread on the table,” and that food self-sufficiency has never felt as threatened as it has during the pandemic.

During COVID-19, one in eight Canadian households reported food insecurity, the highest number to date. Although the government permitted essential businesses – including grocery stores – to keep operating during the worst of COVID, heightened fear of food insecurity stemmed from layoffs and loss of income, rumours of COVID transmission through food handling, temporary grocery store shortages, and travel bans affecting seasonal farm workers from abroad.

The entire Canadian food supply chain is highly interconnected. Restaurants spend $30 billion per year on food and beverages and the average Canadian household spends more than $6,000 per year on groceries. Furthermore, the agricultural sector employs 12.5 per cent of the Canadian workforce and 60,000 migrant workers annually.

With the consumer and labour landscape changing drastically in Canada over the past few months, many players in the food scene are struggling to adjust – and wondering what capital investments to make, given the uncertainty of when and how normalcy will return.

The government has released legislation around funding for farmers, small and medium enterprises and food-insecure individuals, but what could Canada do differently to feed a hungry country?

What is the government currently doing?

Internationally, Canada has emerged as one of the most fiscally generous and progressive in terms of pandemic benefits to citizens and businesses. Food and beverage companies and workers have had access to the same benefits as other Canadians, such as the Canadian Emergency Business Account (CEBA), an interest-free loan of up to $40,000; the Canadian Emergency Response Benefit (CERB), $2,000 monthly for up to six months for people losing other income sources; and its replacement, the Canada Recovery Benefit (CRB).

The government introduced $252 million to support farmers, food processors and food businesses through a $77.5 million Emergency Processing Fund that helps food producers adapt equipment, facilities and processes, and a $125 million initiative for cattle and hog management programs. The Canadian Food Inspection Agency received $20 million toward food-quality monitoring; fish and seafood processors gained access to a new $62.5 million Canadian Seafood Stabilization Fund to help with COVID-related costs; and food banks and other organizations addressing food insecurity received an additional $100 million.

Regions and provinces set different standards for grocery shopping and dining out during COVID to minimize in-person interactions, but the intent was to gradually reopen in line with the number of cases, to further economic recovery.

What more could be done?

Investing in technology: COVID has revealed the need to create robust supply chains, able to withstand market pressures, seasonality and export/import restrictions. Longer-term, the ability to produce and sell essential crops locally will not only strengthen resilience, but also curb greenhouse gas emissions.

Sensor technology can prevent food spoilage, and refrigeration or freezing can help protect perishable food. By using robots to improve efficiency in warehouses, machine-operated checkout lines and other tech innovations, there will be less need to put human health at risk, but more danger of displacement for essential service workers, and potentially deeper labour market challenges around reskilling and upskilling. Since 98 per cent of Canadian farms are family-owned operations, the government also needs to protect these valuable enterprises in the shift to scalable solutions.

Over time, the government could increase R&D spending in technologies that solve some of the problems brought to light during COVID. For example, dramatic consumer shifts have left 200 million pounds of potatoes stuck in storage, stores running out of baking supplies, and major meat-packing plants shutting down. Shocks to the system leave actors unsure about how to equalize demand and supply. Potential innovations include boutique food process operations that are more agile than mega-plants and can adopt third-generation aseptic processing techniques with two-year shelf stability, and blockchain to track the flow of ingredients and commodities and adjust to disruptions in real-time.

Scaling food distribution to the food-insecure: Safely distributing food to vulnerable communities has been a major challenge of COVID, as food banks and soup kitchens have had to modify hours, change distribution systems and rethink the health and sanitation of their operations. The Canadian government is now looking into ways to purchase surplus food and send it en masse to areas in the greatest need. By becoming a “last-resort” buyer of food items that would otherwise go to waste, the government can provide healthy food to low-income families while protecting vulnerable industries.

Finding ways to set up safe bulk food-procurement systems for vulnerable communities, such as hospitals, retirement homes and remote Indigenous communities, will be critical, and governments should explore partnerships with private-sector delivery and logistics companies that already have the necessary transportation infrastructure.

Incentivizing restaurants to invest in health and safety: According to a Restaurants Canada survey of 1,000 restaurant owners, half of all independent restaurants did not expect to survive three months without outside help and 75 per cent were very concerned about debt levels. During COVID, many restaurants resorted to drive-in, takeout or delivery services. As restaurants decide whether to offer indoor and outdoor seating, they balance the continued need for social distancing and the desire to quickly make up lost revenue, with different provinces implementing different timelines and policies. The government could assist with labour costs by extending wage subsidies until businesses are fully safe to reopen, provided affected retail locations comply with all health and safety measures. This prevents restaurants from bringing back workers and customers prematurely.

Fixed costs are another concern for restaurant owners struggling to survive the pandemic. Half of restaurant owners work with landlords that are unwilling to participate in the Canada Emergency Response Commercial Rent Assistance program. The government could move to accept applications from tenants for rent relief and pass moratoria to prevent evictions.

What does the future hold?

With borders still closed and a vaccine far out on the horizon, the government should continue to focus on the recovery of the food and beverage industry and helping at-risk Canadians meet their basic needs.

As the economy improves, they should also seize the moment to rebuild the food supply chain for resilience, equity and environmental sustainability and use technological innovation and local production/distribution strategies to gain a competitive advantage on a global scale.