Today’s climate changes continue to challenge core commodities, including those in favorite snack foods. For example, the drought has put stress on many of the core ingredients, such as corn, soy and cocoa.
While Chief Supply Chain Officers (CSCOs) are generally aware that climate change could impact their strategies, fewer supply chain leaders have strategies in place that acknowledge outright risks to supply, and how this can impact the availability of their most popular brands.
During Gartner Supply Chain Symposium/Xpo™, which is taking place this week in Orlando, we sat down with Claudia Clemens, Senior Director Analyst with the Gartner Supply Chain Practice, after her session, “A World Without Doritos? How Climate Change Is Impacting Food and Beverage Supply Chains.” She explained the relationship between climate and food supply, why some of the world’s most iconic consumer packaged goods (CPG) food brands are at risk, and actions for supply chain leaders.
Members of the media who would like to speak with Claudia further regarding this topic can contact Justin Lavelle to schedule an interview.
Q: Why are popular consumer food and beverage brands acutely at risk of shortages?
A: When you look at the back of a label of your favorite brand of chips or cookies, there may appear to be more than a dozen ingredients, but typically those ingredients can be reduced to a few essential commodities, without which the product could not exist.
These core commodities include corn, wheat, salt, cocoa, dairy, soy and plant-derived oils such as sunflower oil. All of these commodities face similar constraints from climate volatility, particularly ongoing drought conditions in much of the growing world. A great example today is corn. There have been reports that one third of global corn is currently listed in a drought zone that extends from the US to China, through Europe and South America. The problem is truly global, and it is a similar story for many other commodities where rising global demand is meeting with an inconsistent supply.
