ABSTRACT
The Covid-19 pandemic has produced another era on the planet while we sort out the outcomes in various parts of our everyday life. The food sector and food supply chain do not incorporate an exception. In Latvia, the agricultural and food sector is important for the national economy;therefore, it is important that production, processing, logistics, supply and trade disruptions are successfully overcome during the pandemic and the food sector develops rapidly after the crisis and is more resilient in the future. Therefore, the aim of the present research is to examine potential scenarios for overcoming the crisis in food supply chains with the aim of promoting sectoral development and resilience after Covid-19 crisis in Latvia. The research identified two key drivers of food supply chains during the crisis and post-crisis period: 1) market demand for a particular product;2) capability to ensure the production process is uninterrupted, with the availability and sufficiency of individuals/employees at all stages of the food supply chain. Any case of Covid-19 in a company could lead to production interruptions, thereby causing losses to the company and affecting the market situation. The research developed four scenarios for food supply chains for the crisis and post-crisis period, gave descriptions of the scenarios for key food sector segments and found that the scenarios and the resilience of the food sector during the post-crisis period were determined by the duration of the crisis. © 2021 International Multidisciplinary Scientific Geoconference. All rights reserved.
ABSTRACT
The impacts of the COVID-19 pandemic on national economies are characterized as the worst economic turmoil in recent years, as economic growth slowed to the level of the 2008 global financial crisis. At the end of 2019 and the beginning of 2020, economic growth surveys did not project that the novel virus could have a negative impact on economic growth. As a result of the rapid spread of the virus and the increase in the number of infection cases, national governments took strict measures to limit the spread of the virus, which led to a significant deterioration in the economic situation in all industries of the economy. Agriculture plays an important role in providing food to the country’s population, yet the pandemic made a negative impact on sales volumes and prices in the domestic and international markets. The research aims to assess the impacts of the pandemic on milk supply chains in Latvia and come up with solutions to stabilizing the situation in the dairy sector. The national restrictions to combat the pandemic also hampered the dairy sector concerning the sale of raw milk and finished products in foreign markets, thereby leading to overproduction and stockpiling of the finished products, price dumping and a significant decrease in milk purchase prices to or below the production cost level for many dairy farms. Although there is no indication that the pandemic would lead to a decrease in the numbers of livestock and farms or output in early 2021, it is too early to assess the overall impact of the pandemic on dairy farming, as uncertainty over the duration of pandemic restrictions is a major risk to farm survival. The operation of the dairy sector was stabilized by means of the support provided by the government, as well as the farms’ accumulated financial and feed resources. In order to identify future challenges for milk supply chains, the research performed an analysis of operational risks for milk producers and processors to identify the most important risks and design recommendations for their elimination. The longer there is uncertainty about the return of the dairy sector to pre-pandemic output levels, the more likely it is that the pandemic is going to lead to a decrease in the numbers of dairy livestock and farms. © Latvia University of Life Sciences and Technologies, all rights reserved