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Today’s Pickup: ‘Global phenomenon’ as local farms, grocers build logistics capacity

“There’s a growing understanding of the importance of them, the agility of them and how they help service communities.”

Good day,

Amazon, Walmart and other large grocery operations have seen a huge uptick  in demand for online grocery delivery during the pandemic. But a parallel surge is taking place at the other end of the food spectrum – small farmers who are finding new markets  among consumers eager to have locally- grown meat and produce delivered directly to their homes.

As COVID-19 forces a diverse set of suppliers, from restaurants to industrial meat processing plants, to temporarily close, community supported agriculture (CSA)-style food subscriptions or box deliveries are skyrocketing in demand. So are products from local grocers, whose new home delivery services are often more reliable than the Instacarts or Amazons of the world.

 “It’s a global phenomenon,” Thomas O’Connor, a senior director, analyst, in the Gartner Supply Chain Industries and Programs team, told FreightWaves.  Of these small food operators, O’Connor said, “There’s a growing understanding of  the importance of them, the agility of them and how they help service communities.” 

Over the past few years a new crop of tech-enabled startups have been trying to disrupt conventional food supply chains by using logistics platforms to connect shoppers directly with local farmers and producers. Whether heightened consumer interest in these small food operators will continue post-coronavirus is the question.

Many of the farms now providing home delivery have taken on “a great deal of risk” with this new business model, said O’Connor, and it’s unclear they will continue to invest as demand comes back from larger customers such as restaurants.

Stil, in addition to the mega-players, the “smaller operators are the ones most likely to find success” during the pandemic, said O’Connor, who is based in Sydney, Australia, and is now getting same-day delivery from his local grocer, a service he says is more reliable than that of the “big guys.” 

 “Localization is something people are very much recognizing the importance of,” he said.

Did you know?

Delta Air Lines (NYSE: DAL) posted a $422 million pre-tax loss, or $0.51 per share, in the first quarter, for its first quarterly loss in almost a decade. 

Via FreightWaves 

Quotable

“Reports of employee participation in the event organized by labor unions are grossly exaggerated. The union organizers’ claims are also simply false – what’s true is that masks, temperature checks, hand sanitizer, increased time off, increased pay, and more are standard across our network because we care deeply about the health and safety of our employees. We encourage anyone to compare the health and safety measures Amazon has taken, and the speed of their implementation, during this crisis with other retailers.” 

– Av Zammit, Amazon spokesperson, on a warehouse worker walkout held April 21. As told to FreightWaves.

In other news

How to make trucking more eco-friendly

A look at where the industry was 50 years ago, how the industry achieved its current efficiency gains, and where emissions reductions technology and policy is headed for the future. (Fleetowner)

The world’s car giants need to move fast and break things

A mix of stifled production and uncertain future sales will limit profits, as questions of what resources to allocate to electric vehicles and other future technologies gains new urgency. (The Economist)

Women in Trucking names 2020 Women to Watch in Transportation

The women were selected for their significant career accomplishments in the past 12 to 18 months as well as their efforts to promote gender diversity. (Truckinginfo)

Travis Kalanick’s CloudKitchens hits snags

The ghost kitchen enterprise  is struggling to overcome early challenges, limiting how much it can take advantage of the crisis in the U.S. (TheInformation)

Final thoughts,

The California Air Resources Board is expected to release the updated draft rule of its controversial electric truck sales mandate this month. There will be a 30-day comment period following the release of the updated draft, and due to the coronavirus pandemic, a final vote on the rule that was expected in May has been moved to June.

Hammer down, everyone!

Tags

Linda Baker, Senior Environment and Technology Reporter

Linda Baker is a FreightWaves senior reporter based in Portland, Oregon. Her beat includes autonomous vehicles, the startup scene, clean trucking, and emissions regulations. Please send tips and story ideas to lbaker@freightwaves.com.
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