The food supply chain in Latin America is under increased stress from COVID-19, which is exacerbating fragmented food distribution networks, import/export flows, and the ability to maintain proper sanitation and food safety measures. At the same time, unemployment is also rising dramatically, which is making it harder for consumers to afford food.
Already, one-third of the population in Latin America and the Caribbean lives with food insecurity, according to the United Nations Food and Agriculture Organization (FAO). This means consumers have insufficient access to food either due to shortages and/or their inability to afford it. Likewise, food insecurity goes hand-in-hand with a diet that is lacking in healthy, nutritious food.
The FAO also warned that food prices would likely become destabilized as consumers’ purchasing power is further affected by COVID-19, while farmers might have trouble finding labor and affording fertilizer and other farm inputs.
Chile is a case study of the serious impact of COVID-19 on a vulnerable population and stressed food supply chain.
As of June 22, Chile ranked fifth in the world for total number of coronavirus cases (12,681) per million people, behind Qatar (31,485), San Marino (20,543), Vatican City (14,981), and Bahrain (12,808), according to Worldometer, which monitors and ranks coronavirus statistics for 213 countries and territories.
Protests have erupted in the capital city of Santiago in recent weeks, driven in large part over food shortages and rising prices. Chile’s National Statistics Institute (INE) reports that the majority of Chileans’ household expenses outweigh incomes, and credit cards are heavily relied upon to purchase food.
Last year, Walmart Chile issued 1,420,885 credit cards, which is roughly 10 percent of all the country’s active credit cards.
Martín Arboleda, based at the School of Sociology of Universidad Diego Portales in Santiago, Chile, points out that Chile’s massive agricultural export sector not only exposes the country to disruptions that occur regularly in the global food supply chain—changes in trade policy, transportation bottlenecks, etc.—but it’s also forced Chile to depend on imports of grains, legumes, and tubers because so much of the country’s agriculture output is now devoted to the production and export of fruit.
Large-scale agro-food companies are the winner in this scenario, while the country becomes even less self-sufficient in terms of its ability to operate a diverse, independent food supply chain that can affordably and reliably feed and nourish its people.