Black swan events spur big change — is this good news for agriculture among uncertainty?

While we are in the midst of a huge unknown as the world hunkers down to fight a common enemy in COVID-19, significant questions are being raised about food supply chains and economic resiliency.

An event like this is known as a “black swan.” It’s an unpredictable, large-scale, huge impact event that fundamentally shifts how an economy, an industry, and even the world operates. When they are positive, black swan events would be called game-changers — the discovery of how to create nitrogen fertilizer, for example, or the advent of the Internet.

When they are negative — which most black swan events tend to be — they take the shape of market sell-offs, animal disease decimating an entire industry, or, yes, pandemics that shut down the global supply chain of everything from sweatshirts to dry beans.

Don Buckingham, president, and CEO of the Canadian Agri-Food Policy Institute (CAPI) says that COVID-19 is, in the short term, likely going to push governments to triage which industries they support. In times of real crisis, basic human needs take first priority, and food is one of those. That’s good news for agriculture.

Buckingham says that while the basic human need for food is a net-positive for agriculture in the long-term, it’s cold comfort for those making decisions right now.

As we look longer term, however, what will this wide-scale change in supply chain access and movement mean for agriculture? What automation or local focus will emerge? Will the broadband necessary to support this technology be there?

There are always winners and losers to black swan events, he says, but we’ll always come out of them with new innovations, new technology, and major shifts in how things are done.

 

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