5 Ways COVID-19 Is Affecting Food Processing In Victoria | NFI | National Food Institute

5 Ways COVID-19 is affecting Food Processing in Victoria

As Covid-19 restrictions ease in Victoria, it’s a good time to reflect on how the state has handled the pandemic. While some industries had completely shut down, others have learnt to adapt to the challenges of operating in a covid-safe environment. The food processing industry continues to operate and supply the state of Victoria with essential food supplies.

Aside from covid outbreaks in local abattoirs, the food industry has continued to operate right through 2020. The food industry throughout this pandemic has survived in large part thanks to Government support and how businesses have been able to implement safety measures to prevent outbreaks of COVID-19

With new restrictions and measures introduced, we saw many changes to the way things are done within the food processing industry. These changes included how workplace training is conducted, new conditions for accessing funding for workplace-based training, and new safety procedures to stop the spread of COVID-19 amongst workers. The demand for certain types of foods also shifted as more people became housebound.

New government funding schemes

In October 2020 the Federal Government announced the new Boosting Apprenticeships Commencements, a $1.2 billion commitment to industry training. This announcement was part of the government’s economic response to COVID-19. As more support is thrown behind industry training it’s believed that local economies in states like Victoria will start to recover sooner. The wage subsidy has been released in addition to an existing $2.8 billion Supporting Apprentices and Trainees wage subsidy released to benefit all states across Australia.

Boosting Apprenticeships Commencements are set to encourage employers across Australia to take on 100,000 new apprentices and trainees. This $1.2 billion commitment is a new government wage subsidy designed to encourage employers from all industries to take on apprentices and trainees. So while this hasn’t been created specifically for food processing in Victoria, a large number of employers within the state will still benefit from this.

For the boosting Apprenticeships Commencements, eligible employers and Group Training Organisations have been able to apply for a 50 per cent wage subsidy for the commencing or recommencing apprentice/trainee gross wages paid from 5 October 2020. This subsidy is valid until 30 September 2021 and can pay up to $7,000 per quarter. Final claims for these payments will be due by 31 December 2021.

One of the most appealing aspects of this wage subsidy is the fact that businesses of any size or industry are encouraged to apply for it. Group training organisations across Australia are also eligible for this subsidy. These training organisations must pass on the Boosting Apprenticeship Commencement payments to host employers or retain the payment when an apprentice or trainee is no longer hosted by an employer.

A modernised supply chain

COVID-19 has caused one of the biggest disruptions to the supply chain for Australian food and agriculture. Early in 2020, panic buying drove this disruption in the supply chain. We also had fewer workers producing less output as social distancing measures were enforced. Disruptions like these forced producers to use creative freight and operational strategies. Where we produce goods and how they are transported continues to change as Australia transitions to a ‘Covid normal’.

Before COVID-19, the food industry was dominated by a dispersed production model. Internationally or interstate-sourced components would come together in a final production location to be assembled into a finished product. With the closure of borders, we’ve seen the rise of ‘micro supply chains’. This ensures product ingredients are sourced and assembled locally. So popular products such as processed foods and ready-made meals are produced closer to where they are sold.

Another significant and long-term impact of COVID-19 is the increased digitisation and reliance on analytics. Both of these elements are being used to build ‘smart’ supply chains. These new supply chain systems are highly efficient and able to respond much faster to disruptions. With improved analytics, agriculture and food supply business will be able to analyse the impacts of disruptions and restructure their logistics with a faster turnaround time. New technologies being used include intelligent automation, blockchain, IoT, machine learning, and predictive analytics.

Increased food safety

Food purchasing habits in Australia have changed dramatically. It’s all thanks to increased fears of infection and the need to limit person-to-person contact during the purchase and consumption of food. One of the biggest changes so far was the dramatic reduction in face-to-face shopping. Other significant changes include the increase in the average basket size for shoppers. Individuals and families are purchasing higher numbers of grocery items per shopping trip.

Food retailers and service providers have been forced to improve food safety within their premises and supply chains. Contactless purchase and delivery of groceries have also seen a sharp increase in popularity. Food producers have been forced to rethink their risk management strategies which have always ensured strict food safety. Risk management strategies now have to better consider their food categories and suppliers.

Targeted management and mitigation plans need to be in place to assure product quality along with making sure the right quantities are available in the case of a shock to the supply chain. Essentially a food producer needs to be ready for the temporary closure of a factory, a closed state border, or a change in the way their products are supplied to retail outlets like supermarkets.

Increased demand for ready-made meals

During the peak of COVID-19 lockdowns, Victorians experienced what life was like spending more time at home. Millions of office workers were forced to work from home. This drove a rising trend for all food preparation and consumption to take place at home. Victorians were rediscovering their kitchens again as they finally had the extra time to prepare their own meals at home.

For other Victorians, it was simply a case of shifting their eating habits from eating out to eating in. Instead of preparing their meals at home, many also chose to purchase bulk quantities of ready-made meals from the supermarket or have them delivered straight to their door. Over 2020, the sales of ready-made meals have skyrocketed.

The appeal of ready-made meals stems from two obvious selling points. These meals are easy to prepare and have a low average cost. Ready-made meals often range between $8 and $13, far cheaper compared to eating a single meal at a restaurant which can cost upwards of $20.

New workforce management

Workforces within the Victorian food industry have experienced massive changes in structure to cope with COVID-19. Work environments have drastically changed to accommodate higher measures of work safety. This has been done to limit or completely prevent the spread of COVID-19 between workers. Enforcing social distancing has been the most challenging aspect of changing workforces.

Another big change has been the closure of Victorian borders. With less access to visa holders and unskilled labour, it’s been increasingly difficult for some businesses to even fund their workforce. For years, overseas visitors have made up a large proportion of unskilled, temporary, and seasonal labour in sub-sectors such as horticulture and meat processing. Transient and on-demand workforces have proven to be a massive health risk that has been the cause of outbreaks in Australia and around the world.

The government has already made the move to extend visas for current overseas workers in the country. However, this move only locks down the existing visa holders in Australia and there’s still a large uncertainty of when Australia will get access to overseas workers again. The lack of incoming working-holiday makers and seasonal workers will have a large impact on business costs. More producers within the food processing industry will start to rely on local labour which will be more expensive to hire and maintain.

How NFI can help

Just like any other industry trainer, the National Food Institute has experienced many challenges in supporting trainers, students, and employers. We have updated the way some of our theoretical components of training are being delivered. Students and trainers can now access a large portion of their training materials through an online portal. With changes like these, students and apprentices can continue to learn and thrive in 2020.

With the changes in government support, we’ve assisted many workplaces and students with their funding applications. In doing so, we’ve helped thousands of students start or resume their workplace-based training in 2020. We’ve assisted workplaces and students with securing funding places for initiatives such as the Smart and Skilled initiative in NSW along with the Boosting Apprenticeships Commencements which are available Australia wide.

So if you’re a student or employer looking for funding assistance, contact the National Food Institute today. Our staff have already helped many funding applicants navigate through the noise. We have the most up-to-date knowledge of the latest government funding initiatives. We can find out if your workplace is eligible, how many training places you qualify for, and how much funding you can get access to. So if you need help securing funding or simply want advice, contact us today.

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