The outbreak of coronavirus which was declared a pandemic by the World Health Organization (WHO)
on 11 March 2020.
Globally, the food & beverage industry is expected to experience the differential impact of
this rapid spreading COVID-19 on each stage of its value chain through the mediums of the
affected workforce at industrial level, raw material supply , trade & logistics, demand-
supply volatility and uncertain consumer demand at foodservice outlets—among other
factors. Production, distribution, and inventory levels across the food & beverage industry
spectrum are expected to be impacted.
The affected workforce in agricultural farms, food & beverage production & processing plants,
and distribution network are analysed Travel bans imposed by several countries are also a
contributing factor, affecting the availability of critical personnel required in key decision-
making. The workforce can potentially affect business plans and industrial production of food
& beverage products.
Raw material supply: Agriculture and livestock industries
Agricultural produce, which forms the key raw material for subsequent stages in the food
value chain, can become a potential source of bottleneck for the food & beverage industry.
This is true especially for countries such as Australia, which imports large scale essential
agrochemicals and crop protection products from China. The country is amongst the largest
producers of both ready-made pesticides and active ingredients that are used to form the
base of different crop protection products formulated in the importing countries.
Trade and logistics
Trade restrictions imposed by several countries to curb the outbreak of covid 19. Restrictions
have had a direct impact on the food supply chain with the tightening of transportation and
port capacities whilst also leading to an increase in shipping and freight costs. Furthermore,
this has resulted in the shortage of food supply, which is likely leading to choked production
and affected availability of food & beverage products at retail level. A prolonged restriction on
trade and logistic challenges will likely have a significant impact on the revenue of food
Demand-supply volatility: Food manufacturers, processors, food retail and
While the food & beverage manufacturers & processors are more likely to be affected by the
shortage of labour and raw material required in the production process, food retail and
foodservice outlets are expected to experience more intense challenges right from the get-go.
For food retail outlets, the challenge would be to deal with the possibility of the irregular
footfall of consumers and, contrastingly, to also assess the possibility of stockpiling food &
beverage products to ensure continuity in consumer access to products they intend to
The reluctance of consumers on the verge of growing outbreaking of COVID-19 has led to
major uncertainties in consumer demand. Various posts and false rumors on social media
have inflicted scare among consumers and have influenced their perception toward a variety
of food & beverage products—especially animal-based products.
Strong global concerns about the pandemic coronavirus have largely but negatively
influenced the global functioning of the food & beverage industry and the mindset of
consumers, given the health risks.