Recent events near and far have served as stark reminders of the urgent and escalating reality of climate change. In September, as Oxford University researchers recorded the city’s wettest month since 1774, farms across the UK were being washed out by heavy rainfall.
Just a month later, devastating floods tore through eastern Spain, claiming over 200 lives, leaving a trail of destruction to agricultural and public infrastructure, and incurring costs estimated at £2.5bn.
2024 proved, in no uncertain terms, that climate change poses the greatest long-term threat to the UK and global food system. Alongside the shifting global order, emerging viruses, and the rapid pace of agricultural transformation, businesses of all sizes are now grappling with a growing set of dynamic and pressing challenges.
War, energy prices and supply chain
But the nature of these risks is evolving. Immediate issues such as war in Europe, soaring energy prices, and post-Covid supply chain disruptions are easing as long-term challenges come to the fore, requiring a proactive, collective response. Our latest research highlights that a combination of ongoing labour shortages, cybersecurity attacks, and the continued decline in biodiversity will drive the food system to adapt in radical ways over the coming years.
One area of particular concern is falling capital expenditure levels, after accounting for inflation. Capital investment, which is crucial to our food system’s long-term success, fell by 7% between 2019 and 2022 according to the latest data. Due to low business confidence and the ongoing impact of the war in Ukraine, capital investment levels are unlikely to have improved since this point.
Investment to build resilience against risk is most needed by agricultural producers – however, last week’s NFU confidence survey painted a sobering picture. Confidence has hit record lows, with many farmers planning to hold back machinery investment to support short-term cashflow needs. This will have immediate impacts and undermine efforts to build resilience.
Many of the challenges faced are not new – businesses across the food system have demonstrated great agility, responding effectively to resulting shocks. This was no more evident than during the pandemic, where businesses and government collaborated in unforeseen ways to ensure our shoppers remained fed.
Five years on, as we look ahead, we may not be so fortunate. Long-term risks are worsening, and their impacts are less predictable. Shocks are happening more often and with greater intensity, meaning leaders can’t easily anticipate or prepare for them.
Interconnected risks
Our latest Resilience Report describes 10 key risks to the UK food system, but these are all interconnected, requiring a complex web of actors and actions to respond to their impacts. Responding to this will be challenging. Leaders must adopt a systems thinking approach, recognising their organisation is part of an increasingly challenged global food system, identifying supply chain vulnerabilities and effectively scenario planning for a range of eventualities.
The changing landscape offers opportunities for joined-up solutions – whether that be intelligence sharing, pooling investment to develop technological innovations, or driving adoption of operational improvements.
Building resilience will rely on the collective effort of businesses across the supply chain, with everyone stepping up to the challenge. Given the scale of the issue, the government also has a role to play in creating comprehensive solutions. Leading businesses are recognising the importance of resilience, rethinking future infrastructure and investment needs, and cross-system collaboration is accelerating.
Ministers assert that “food security is national security”. The food system wholeheartedly agrees.
Food security must now be prioritised, binding government, business and the public together to drive progress to a thriving food system. The upcoming food strategy can be the start, but must not be the end.
Matthew Stoughton-Harris is the resilience lead at the IGD
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