Flood Risk in Supply Chains

With severe flooding affecting many households and businesses across England and Scotland over the Christmas period, Morrisons and Nestlé have each pledged £100,000 to help flood victim but what are the effects on the food industry supply chain?

Flooding is the most common and widespread cause of natural disaster in the UK. If the climate becomes increasingly volatile we can expect to see more floods in the UK and worldwide. If sea levels rise, this would accentuate the problem.

UK population is projected to continue increasing and new building developments could also make flooding from surface water more frequent.

Some 14% of the agricultural land in England and Wales is considered at risk of flooding, either from rivers or the sea. The past few years have been some of the wettest on record and floods have hit the UK annually. It isn’t just Britain that has been battered by the rain; floods have occurred everywhere from Asia to Europe.

As flood risk intensifies globally, supply chains need to adapt and protect themselves in order limit disruption and loss.

However, businesses also need to be proactive in mitigating flood risk to their supply chains if they want to improve their resilience.

The most important resource for food production is water. Under extreme conditions water is either scarce, or in abundance, and therefore effective management strategies must be developed.

Adverse weather conditions may also impact the amount of nutrients, herbicides, fungicides and pesticides applied to soil, as well as the methods of application. Under wet conditions more energy (e.g. diesel fuel, electricity) will be required to work waterlogged fields, dry grain and maintain a consistent storage environment. Competition for water and energy between sectors is likely to drive up prices, thus increasing the cost of food production.

Developing a clear understanding of where vulnerabilities exist in the supply chain requires a whole systems approach. The ability to visualise a complete supply chain is a prerequisite to understanding where vulnerabilities reside and the impact they may have on the operation of the supply chain.

Identifying at-risk suppliers through supply chain mapping allows you to identify at-risk suppliers and diversify networks so if one area is hit, supplies can be re-routed with minimal disruption.

Identifying at-risk suppliers through supply chain mapping allows you to identify at-risk suppliers and diversify networks.

Posted by: Authenticate 08/01/2016