Sector News

Industry groups criticize patchwork of business closings

April 9, 2020
Food & Drink

Industry groups representing nearly every sector of the US economy are calling for clearer and more coherent guidelines for essential business designations.

State and local officials have implemented a variety of stay-at-home or shelter-in place orders, designating different types of nonessential businesses and services that may remain open. As a result, businesses are encountering a patchwork of different quarantine orders that may come into conflict with one another.

“The lack of clarity around what constitutes ‘critical’ and ‘essential’ business and workers and the lack of uniformity in guidance hurts efforts to respond quickly,” said Christopher Roberti, senior vice president for cyber, intelligence and supply chain security policy at the US Chamber of Commerce.

The US Chamber called on governors and local leaders to adopt a guidance issued by the Cybersecurity and Infrastructure Security Agency (CISA) in March.

The guidance identified food and agriculture as a critical industry. Essential workers include those supporting grocers and other retailers that sell food and beverage products, foodservice carryout and delivery operations, food manufacturers and their suppliers, farms and farm support services, food distribution, sanitation of food manufacturing operations and food testing, among others.

Twenty-one states that have shuttered nonessential businesses have referenced the CISA’s guidance. More than two dozen have issued their own guidelines, all of which include similar exemptions for businesses supporting the food supply. Several states have yet to issue any orders closing nonessential business.

Despite their essential business status, companies in the food and beverage industry may still face interruptions caused by the patchwork of guidelines. Growers and processors may be allowed to continue operations, but businesses and services that support those operations may not. In some states, only essential employees at essential businesses have been allowed to continue working.

Customer service call centers have been deemed nonessential in some states, which has limited companies’ access to critical banking and financial services, the US Chamber said.

Issues may arise when states close or limit operations at motor vehicle offices. Inability to issue commercial driver’s licenses could hinder the trucking industry’s ability to ensure continuity of operations for food suppliers, the National Grain and Feed Association warned.

Other potential interruptions in the food supply may stem from curfews meant to help limit the spread of the outbreak.

“Curfews that do not consider transportation and workforce needs could quickly become significant barriers to not only supply chains, but also actual supplies,” the Consumer Brands Association and several other trade groups said in a March 25 letter to elected officials.

The groups urged authorities to consider the complexity and interconnectedness of supply chains when defining essential businesses.

“These definitions should include upstream suppliers such as packaging and raw ingredients producers as well as producers of product for export, and transportation services providers,” the letter said.

International coordination

The US Chamber recommended foreign governments use the CISA guidance as a model for defining essential business.

“There’s an inevitable tension between the need for what public health officials are telling us, which is ‘we need social distancing,’ and the need to have essential economic functions continue,” said John Murphy, senior vice president of international policy at the US Chamber of Commerce. “We’ve seen that play out in other countries around the world.”

The US Chamber advised local leaders in other countries follow a course that coheres with what federal authorities are doing.

“We’ve seen this play out to some degree in Canada and Mexico,” Mr. Murphy said. “The province of Ontario, for instance, has taken a slightly different track. In Mexico, it was the state of Sonora. Having unclear guidance from one jurisdiction to another really complicates the ability of industry to provide those essential services.”

The US Chamber encouraged the US government to work with international partners to ensure access and movement of critical goods can go forward.

“A single country acting alone cannot hope to defeat this threat to public health and global economic stability,” Mr. Murphy said.

By Sam Danley

Source: Food Business News

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