Fighting food insecurity

Food insecurity is on the rise in Canada, thanks in large part to inflation that has resulted in skyrocketing prices at the supermarket. But inflation doesn’t just affect grocery bills. It can be seen throughout the value chain, with rising costs for animal feed, equipment, labour, transportation and packaging.

Inflation, along with climate change and animal disease, are just some of several interconnected factors impacting Canada’s food system. These factors are contributing to volatility in food prices and availability that affect Canadians at the supermarket. Canada’s Food Price Report 2023 predicts an increase in food prices by five to seven per cent in 2023, on top of steep increases throughout 2022.¹ The 2022 Hunger Signs report by KPMG US found that many consumers are changing their purchasing behaviours to mitigate rising prices, such as buying more of their groceries on sale. They’re also looking to buy different brands or private-label items to avoid paying higher costs, stocking up on items in case prices continue to rise, as well as buying in bulk or wholesale.

Last year, food bank use rose to its highest levels in Canadian history, in part due to significant increases in the cost of living that pushed many Canadians—including seniors, single-parent families and low-income wage earners—to the edge.² According to Second Harvest, the number of people served by food banks and other non-profit organizations is expected to increase 60 per cent in 2023—and that’s on top of 134 per cent growth in 2022.³ Without help, the non-profit organization says thousands of Canadians will not have enough food to feed themselves. But the answer is not more food banks. Rather, it’s about broader systemic change, which underlines the importance of diversification, innovation, and AgTech in Canada’s food ecosystem.

While the pandemic may have been a black swan event, it wasn’t the cause of food insecurity. Rather, it highlighted structural issues such as labour shortages and a reliance on complex global food chains.⁴ Areas of improvement to address food insecurity include strengthening domestic capacity, building resilience into supply chains and developing new markets. But diversification will be key in adapting to more extreme climate events.

An increase in domestic production could help to mitigate some supply chain issues and protect the Canadian food supply from disruptions related to global conflicts, border issues and trade embargoes. By supporting infrastructure needed for a domestic market, it’s possible to shorten supply chains and increase resilience within the food system.

That could mean looking at regional versus centralized production, and diversifying distribution centres to include smaller ones that service local areas. Building sustainability into operations to better adapt to climate events could involve new technologies that enhance yields while minimizing inputs; transitioning toward more regenerative forms of farming; and using renewable energy sources to power farming systems.

Producers continue to look for ways to mitigate price volatility, such as diversifying their own suppliers and seeking sources closer to home. Export diversification, evolving with global market demand and mitigating labour shortages with automation could also help to re-enforce Canada’s food supply chain.⁵

Agricultural innovation can help to lower food production costs through advanced technologies such as artificial intelligence, the Internet of Things (IoT), robotics, autonomous vehicles and blockchain, helping farmers and producers do more with less. Leveraging technology to produce more food domestically, or using analytic insights from the supply chain to be more proactive than reactive, could help to combat input costs that drive food insecurity.

For example, connected sensors and drones could be used to monitor soil moisture levels in fields, which in turn could help to increase yields. Blockchain could be used to provide real-time visibility into the supply chain, so farmers and producers could adjust production to meet demand. And IoT could help farmers, producers, processors and retailers understand where food spoilage occurs across the supply chain to reduce waste.

While an increase in domestic production could help to solve some of these issues, that alone won’t solve the larger issue of inefficiency and waste around just-in-time delivery models. A shift toward circularity in food and crop production systems means food that would otherwise go to waste is instead redirected into products such as animal feed, fertilizer, fabrics and even sources of bioenergy. That helps to lower the cost of inputs going back into the circle, while reducing waste and regenerating natural systems.

The 2019 Canada Food Policy highlights innovation as an important part of its plan going forward, which includes investments to increase the agriculture and food sector’s capacity to produce high-quality food. While AgTech can help farmers, producers and processors do more with less, investing in new technologies and processes can come with significant upfront costs—and more can be done from a policy and funding standpoint to start building a truly stable, secure food system. A collaborative approach among stakeholders, along with agricultural innovation and adaptive policies, can help Canada prepare for the future of food.