Up to 50% of the harvest is wasted in transportation and 1/6 of all greenhouse emissions worldwide are related to transport. Small farmers are suffering from disproportionate costs with almost 25% of expenses being directly related to transportation. Industrial competitiveness, food security, and economic development are strongly linked to efficiency in logistics. While farm mortgage loans can help farmers cope with these costs, they do little to directly combat global hunger. In order for global hunger to end, major changes need to occur in the realms of food storage and transportation.
Mitigating Losses in the Farming Industry and Fighting Hunger
Each of the stages in the farming process contributes to losses. Farmers cannot directly address losses in the consumption stage. However, they can address losses in the production, handling, and storage stages in the supply chain with technology and modernization. While progress has been made, there is still an opportunity to improve.
Governmental programs and even third-party farm mortgage loans offer lower rates and easy availability of credit to help farmers tackle issues in transportation and storage. Common issues that farmers must address include:
- Involvement of Agents
- Complex or Broken Value Chains
- Technology and Innovation
Involvement of Agents
As more agents get involved between the harvest and the fork, costs and losses both rise. This creates less incentive for each agent to contain these inefficiencies.
Complex or Broken Value Chains
The more complex the value chain, the greater the risk of breaking. This is seen with specialized chains such as cold storage chains that are impacted by handling, packaging, and storage. Complexity in terms of logistics worsens road safety and pollution outcomes for everyone. For instance, cold storage chains consume far more energy to stay alive than other chains.
Technology and Innovation
Technology and innovation can solve many of these issues. For example, ag financing can help fund projects like solar-powered mobile refrigeration units which are particularly helpful in far-flung areas. This brings down the cost of energy utilization. Integrated supply chains are an example of cutting edge innovation helping improve sustainability.
Finally, economic prosperity can be preserved via a very balanced principle in policy-making. Indeed, the government is the biggest stakeholder and the agent of change.
Address Transportation and Storage Issues on Your Farm
Farm mortgage loans can give you the capital needed to improve your operations and address your own issues with transportation and storage. Talk to an AgAmerica loan officer today to learn more about the financing options available.