A recent letter coordinated by Inside Track, drawing on senior leaders across the UK food sector, raises an uncomfortable question: has the industry's success in navigating repeated disruption created too much confidence in the resilience of the system underneath it?
Food businesses have absorbed a remarkable sequence of shocks. Covid disrupted logistics. Russia’s invasion of Ukraine destabilised energy, fertiliser and commodity markets. More recently, disruption around the Strait of Hormuz has again shown how quickly geopolitical shocks can transmit through energy, fertiliser and food systems. At the same time, the 2026/27 El Niño is expected to reshape rainfall and temperature patterns across major agricultural regions, increasing the risk of drought, flooding and extreme heat into 2027.
Yet, in most cases, food has continued to reach shelves. Buyers have diversified suppliers, shifted sourcing geographies, reformulated products and changed inventory strategies.
That performance matters. But it can create a misleading impression of resilience.
These measures preserve sourcing flexibility: the ability to respond when one source of supply is disrupted. They do not necessarily protect production resilience: the ability of the underlying production system to continue producing.
For a time, strong procurement can compensate for weak production systems. The harder question is how long that remains possible.
Diversification remains one of the most effective ways to manage supply-chain risk. Its value depends on alternative sources being exposed to sufficiently different risks.
That becomes harder where risks are driven by climate and nature.
Different suppliers may share exposure to the same watershed, production region, ecological dependency or climatic regime. Different sourcing countries may still be vulnerable to the same drought pattern, disease pressure or extreme temperature. Even where exposures are genuinely distinct, climate change increases the prospect of adverse conditions occurring across several major producing regions at the same time.
Diversification only helps if there are still credible alternative sources to switch to.
As climate and nature risks affect more sourcing regions at once, those alternatives can become fewer, more expensive or exposed to the same underlying pressures.
When production falls in one region, buyers can shift volume elsewhere. When output is constrained across several regions simultaneously, those same buyers compete for a smaller pool of supply. The effects show up through price, quality, availability and increasingly difficult trade-offs over specifications and sourcing standards.
This is the risk highlighted by research into “multi-breadbasket failures”: poor harvests occurring simultaneously across several major producing regions. Trade normally allows shortages in one region to be offset by production elsewhere. But as climate hazards become more correlated across major growing regions, that balancing mechanism becomes less reliable.
Diversification therefore remains necessary. But its effectiveness ultimately depends on the resilience of the production base behind those alternatives.
Global production is heavily concentrated in Côte d’Ivoire and Ghana. During the 2023/24 season, production fell sharply as adverse weather, pests, disease and ageing trees affected output across the major producing regions. Prices rose dramatically as the market moved into deficit. The International Cocoa Organization forecast a global production deficit of 462,000 tonnes for the season.
For buyers, the immediate responses were familiar: secure volumes earlier, renegotiate contracts, switch counterparties where possible and pay more for scarce supply.
But procurement tools can redistribute scarce supply. They cannot recreate it.
A buyer can change trader. It cannot quickly replace ageing cocoa trees, restore depleted soils or create a new production region.
Tree crops make the point particularly clearly because productive capacity cannot be expanded on procurement timescales. Replanting takes years. Disease can undermine output for multiple seasons. Low farm incomes can defer investment until the productive base has already deteriorated.
The ICCO has described Ghana’s production problems as structural in part, citing swollen shoot virus, ageing trees, unfavourable weather and other pressures.
At that point, paying more or switching counterparties may change which buyer secures the available cocoa. It does not restore the missing production.
The implication is that companies need to look beyond their supplier lists.
Two suppliers that appear diversified commercially may depend on the same river basin, face the same heat threshold or source from production systems exposed to similar disease pressure.
Supplier-level visibility is useful, but it does not necessarily reveal whether several suppliers share the same physical dependency. Certification can provide assurance around particular practices, while still leaving questions about exposure to water scarcity, declining climatic suitability or ecosystem degradation.
The useful unit of analysis is therefore not simply the supplier. It is the production system: where production takes place, what it depends on, how those conditions are changing and which constraints could impair future output.
In one sourcing region, water availability may determine future production. In another, the constraint may be heat tolerance, soil condition, disease pressure or ecosystem degradation.
Companies then need to understand how material those constraints are and how correlated they may be across the sourcing portfolio.
That creates a prioritisation problem: which constraints materially threaten future supply, and where would intervention actually change the outcome?
Understanding where production is vulnerable does not, by itself, solve the problem.
Those who benefit from resilience are not always those best placed to fund it.
Many agricultural resilience measures have long payback periods. Replanting tree crops, changing irrigation systems, restoring soils or shifting production methods may require significant capital before the benefits are realised.
At the same time, producers often operate with volatile incomes and limited capacity to absorb upfront costs. Defra’s 2026 Farmer Opinion Tracker found that farmers frequently linked weak or volatile prices to reduced margins and lower capacity to invest, and some explicitly described price volatility as limiting their ability to plan, invest or adapt.
Buyers face a different set of incentives. Procurement teams are rewarded, reasonably, for maintaining flexibility: securing quality, managing price and avoiding excessive dependence on any one supplier.
The result is a mismatch in time horizons.
Producers may be asked to make investments that improve the reliability of supply over the next decade, while buyers retain the option to switch elsewhere next season.
The problem is therefore not necessarily a lack of awareness. The commercial architecture of many supply chains rewards flexibility at the buyer level while leaving much of the long-term investment in productive resilience with producers.
Both sides are acting rationally within their own constraints. The result can still be underinvestment in resilience at the system level.
Longer-term agreements, co-investment, greater price certainty, technical support or transition finance can help close that gap. Their value is not that they are inherently more resilient, but that they can change the economics of investments that would otherwise be difficult for either party to make alone. FAO work on contract farming highlights how more stable commercial arrangements can reduce uncertainty for producers and support investment.
These arrangements trade some short-term flexibility for greater confidence in future production.
A sourcing model optimised entirely for flexibility can weaken incentives for long-term investment. Locking in supply indiscriminately can create concentration and performance risk. The challenge is to determine where greater commitment creates more resilience than flexibility.
But continuity through past disruption is a poor proxy for the resilience of the production system underneath it.
A company can continue sourcing from alternative regions even as water stress rises across its supply base. It can maintain cocoa volumes while the productive capacity beneath them deteriorates.
For a time, strong procurement can compensate for weak production systems.
The risk is that this success masks a gradual erosion of the alternatives available.
The strategic question is therefore broader than how quickly disrupted supply can be replaced. Companies also need to ask how durable those alternatives are, which risks are shared across their sourcing base, and where productive capacity itself needs protecting.
Tactical sourcing can absorb disruption. Long-term resilience is about ensuring there remains something reliable to source from.