Climate change and the global food supply

• Climate change is threatening essential crops like corn, wheat, rice, and potatoes, as well as luxury commodities such as cocoa, coffee, and sugar
• Extreme weather events are disrupting harvests and supply chains, causing shortages, price spikes, and unpredictability in crop yields
• Changing climate patterns are shifting growing regions
• The food and beverage industry is responding with tech innovations, including AI forecasting, precision agriculture, and climate-resilient sourcing strategies
• Long-term solutions include vertical farming, hydroponics, and improved storage and transport systems

The food and beverage industry is facing a growing crisis. And it’s feared changes are not being made quickly enough to stop disaster.

The problem?

Climate change is damaging essential crops, including corn, wheat, rice, and potatoes.

“Extreme weather and climate risks are now among the top threats to global business and agriculture,” says Dr Scott Kelly, senior vice president of environmental analytics at supply chain risk assessment firm, Risilience. “Yet many companies are staying silent on these record-breaking risks.”

Added to that, luxury commodities, such as cocoa, coffee and sugar are also under threat.

Climate threat to commodity supplies

“Put simply, extreme weather events are wreaking havoc on harvest unpredictability and creating supply shortages,” says Andrew Dalziel, vice president of industry and solution strategy at supply chain specialists, Infor.

This is particularly true for time-sensitive crops, such as peas, which need to be processed within hours of harvest. If the crops are damaged then there’s little to no buffer stock or imports to fall back on.

And the challenges don’t stop there. Many growers and fresh produce wholesalers lack temperature-controlled warehouses and transport, meaning products can spoil quickly in excessive heat while still in the supply chain. Moreover, extreme weather events can disrupt transportation due of flooded roads and damaged railway lines.

On top of that, extreme temperatures are driving up the cost of cold storage, which is heavily dependent on energy to maintain precise conditions. Potatoes, for instance, need to be kept cool if they are to be stored through the winter.

And if crops are left exposed to the elements then instances of heavy and prolonged rain can lead to outbreaks of disease such as botrytis (grey mould), which can quickly destroy crops such as tomatoes and lettuces.

Plus not only are these losses threatening food security, the resulting scarcity is pushing up prices for manufacturers, retailers and consumers.

Shifting fortunes across food supply chains

What makes the impact of climate change and extreme weather events even more complex is the shift in growing conditions.

“Northern Europe is beginning to benefit from longer growing seasons, while southern areas are suffering significant yield losses,” says Infor’s Dalziel. “This leads to tighter export volumes through an already fragmented and risk-prone supply system.”

Though the real challenge is the different types of extreme weather events.

Over the past year alone, Europe has experienced historic droughts, historic floods, and extreme high temperatures. All of which have damaged or destroyed crops and endangered livestock.

“This is hitting agriculture hard,” says Dalziel. “In the UK, amber weather warnings and hosepipe bans are straining farming operations. Meanwhile, Spain, a key supplier of olives and vegetables, is battling heat stress and water scarcity, which is reducing yields and limiting irrigation options.”

And even when rain finally does arrive, dry soils from prolonged drought are at risk of becoming hydrophobic, meaning they can struggle to absorb water – worsening the impact of dry spells. At the same time, shifts in rainfall and temperature are contributing to soil degradation and higher pest pressure.

“Milder winters mean pests can survive and multiply earlier in the season, which is especially challenging for organic and pesticide-free growers,” explains Dalziel.

What is the food industry doing to protect supply chains?

Though it’s argued the food industry is not moving fast enough to mitigate the threat of climate change, measures are being taken.

“We are seeing larger processors diversifying their sourcing regions, adding climate-resilient crops to portfolios, and localising processing to reduce transit times for perishable ingredients,” says Infor’s Dalziel.

Suppliers are also increasingly using technologies, such as AI and machine learning, to forecast demand and predict harvest yields based on weather patterns, soil data, and crop history.

Innovations in food analysis are allowing suppliers and manufacturers to set more accurate sell-by dates, based on the actual quality of the product, rather than relying on fixed lead times.

And precision agriculture is helping to optimise water usage and fertiliser application, reducing dependency on vulnerable natural resources.

“These tools allow for better planning and faster responses to unexpected supply disruptions,” says Dalziel.

Furthermore, 77% of global food and beverage organisations are planning to increase their technology spend by 20% or more in the next few years as they race to futureproof their operations (Infor).

What more can be done to protect supply chains?

“To better manage the impact of extreme weather, the industry needs to focus on both immediate actions and long-term strategy,“ says Infor’s Dalziel.

In the short term, manufacturers can improve how their digital systems work together by linking supply chain planning with demand forecasts and production. This will help to ensure fast and effective responses to disruptions. Risks to supply can also be mitigated by sourcing ingredients from a wider range of regions and planning for different climate scenarios.

The wine industry, says Dalziel, is a prime example. French producers are now investing in British vineyards. With over 1,000 vineyards and more than 200 wineries, the UK is fast becoming known for high-quality sparkling wines, resulting from changing climate conditions.

Looking further ahead, food and beverage businesses are urged to invest in advanced technologies that make their operations more connected and adaptable. Cloud-based platforms, AI forecasting, and real-time supply chain visibility tools will help to predict and prepare for potential disruptions.

Crucially, AI can also support in real-time processing decisions based on the quality of incoming ingredients, adjusting recipes or formulas by suggesting alternatives within acceptable percentage thresholds, helping businesses to stay flexible when ingredients are scarce or variable.

But when it comes down to it, protecting the supply itself is really the most important factor, rather than continually searching for alternatives which could themselves come under threat in the future.

“To improve crop predictability and reduce reliance on external conditions, methods like glasshouses, hydroponics, and vertical farming are likely to become more common – offering better control over temperature, water, and nutrient use while minimising waste and input costs,” says Dalziel.

It’s likely that we’ll also see increased investment and innovation in storage and transportation, with technologies such as advanced temperature and humidity control, improved air circulation, and smart energy management systems helping to preserve product quality and extend shelf life more efficiently.

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