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Changing environmental conditions could lead to worldwide food shortages
The planet may be entering a new era of food shortages on a global scale.
According to Yahoo! News, a book by Earth Policy Institute president Lester Brown reveals that food prices have doubled over the past ten years and will likely continue to rise.
The changing environment may be to blame. Large dustbowls are forming in response to this shift, most notably in Central Africa and Northwestern China. Irrigation wells and aquifers in the U.S. and 17 other countries are depleting.
Brown speculates that due to the changing environment, world food production will likely decrease, leading to shortages. He continues that countries may compete for fertile land and fresh water as these resources become scant.
Officials believe these dramatic and dangerous changes could be the effects of climate change, possibly stemming in part from human pollution of the environment.
Diapers, Cereal and, Yes, Toilet Paper Are Going to Get More Expensive
Retailers used to absorb much of the cost of goods when suppliers raised prices. Now, the difference is being passed on to shoppers.
General Mills, the maker of Cheerios, is facing increased costs, its chief executive told analysts. Credit. Getty Images
Procter & Gamble is raising prices on items like Pampers and Tampax in September. Kimberly-Clark said in March that it will raise prices on Scott toilet paper, Huggies and Pull-Ups in June, a move that is “necessary to help offset significant commodity cost inflation.”
And General Mills, which makes cereal brands including Cheerios, is facing increased supply-chain and freight costs “in this higher-demand environment,” the company’s chief financial officer, Kofi Bruce, said on a call with analysts.
These price increases reflect what some economists are calling a major shift in the way companies have responded to demand during the pandemic.
Before the virus hit, retailers often absorbed the cost when suppliers raised prices on goods, because stiff competition forced retailers to keep prices stable. The pandemic changed that.
It created chaos and confusion in global shipping markets, leading to shortages and price increases that have cascaded from factories to ports to stores to consumers. When the pandemic hit, Americans’ shopping habits shifted rapidly — with people spending money on treadmills and office furniture instead of going out to eat in restaurants and seeing movies at theaters.
This, in turn, put enormous pressure on factories in China to produce these goods and ship them across the Pacific in containers. But the demand for shipping outstripped the availability of containers in Asia, yielding shortages that resulted in higher shipping costs.
The Consumer Price Index, the measure of the average change in the prices paid by U.S. shoppers for consumer goods, increased 0.6 percent in March, the largest rise since August 2012, according to the Bureau of Labor Statistics.
Higher costs aren’t affecting just the United States. British inflation hit 0.7 percent in March, fueled by the prices of oil and clothing.
In the beginning of the Covid-19 crisis, companies were focused on responding to the surge brought on by panic buying, with people stocking up on items like toilet paper, cleaning supplies, canned food and masks, said Greg Portell, a partner at Kearney, a consulting firm. The government was watching for price gouging, and customers were wary of being taken advantage of.
“When the pandemic first struck paper, toilet paper was like gold,” Mr. Portell said. “The optics of trying to take a price increase during that time just weren’t going to be good.”
Canned beer and soda
The average consumer would have been blissfully unaware of the shortage of aluminum cans , had it not caused the shortage of some types of Cokes and beer. The aluminum industry and the beverage can manufacturers are experiencing a high demand for their products, largely stemming from people's homebound lifestyles. Companies like Coca-Cola are dealing with the shortage of cans as well as a growing demand for their core products by retiring hundreds of less popular brands . Say goodbye to classics like Tab , Northern Neck Ginger Ale , Cherry Coke Zero, Pibb Xtra, and many others. To see a list of discontinued drinks, check out 10 Beverages Vanishing From Grocery Shelves This Year .
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Toilet Paper, Paper Towel Shortages Cost Stores Over $1 Billion During Pandemic, With New Out-Of-Stocks Likely
Retailers and manufacturers moved to a just-in-time supply chain model to save money on inventory and warehousing. That strategy backfired big time as demand surged due to the pandemic, and business are just now starting to add up the cost of those missed sales.
Retailers lost more than $1.5 billion in sales of toilet paper and paper towels alone, and the top 10 most common sold-out items added up to nearly $3 billion in lost sales, between March 2020 and February 2021, according to NielsenIQ’s On Shelf Availability Barometer.
Out-of-stocks in new categories are expected, as vaccinations and normalization create demand for different products, and as stores experience the fallout from the roadblock in the Suez canal.
Sold-out items have continued to be a problem for retailers long past the initial panic-buying during the early months of the pandemic, NielsenIQ analysis revealed.
Toilet paper was the biggest missed opportunity, with $836.5 million in sales forfeited due to empty shelves, followed closely by paper towels, at $689.3 million. Multi-purpose cleaners, dog food, cat food, ready to eat-cereal, laundry detergent, bath and shower soap, multi-serve pizza, and soup were the next eight items on the top 10 sold-out list created by NielsenIQ.
NielsenIQ calculates that the top 10 most out-of-stock items cost supermarkets close to $3 billion . [+] in last sales over the past year, with toilet paper and paper towels leading the list.
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Out-of-stocks don’t just mean lost revenue, NielsenIQ reported, but can lead to lost customers as well.
“Not only can retailers lose a significant amount of their sales if the products are not on the shelf, but out-of-stocks also result in reduced customer satisfaction and lower loyalty levels,” Richard Cook, Intelligent Analytics Leader at NielsenIQ, said.
NielsenIQ research found that 30% of shoppers will visit new stores when they can’t find what they are looking for at their regular retail location, and 70% will buy a different brand when their typical choice is out of stock.
Warmer weather, vaccines and a rush to return to normalcy could trigger a different set of out-of-stocks in the spring and summer, NielsenIQ warned. Sunscreen and insect repellent, and if schools reopen widely, lunch meat, could become hard to find, Cook said.
Merchandise for Easter celebrations is likely to face out-of-stocks, as growing numbers of vaccinated Americans are “yearning to socialize and be with their families,” he said.
Paper towels, particularly the Bounty brand, were hard to find for much of 2020.
Retailers and manufacturers realize they need to re-think their supply chains for a world where spikes in demand may be hard to predict.
A new report by Capgemini Research Institute found that two-thirds of retailers and consumer products companies plan to significantly change their supply chain strategy over the next three years.
Capgemini found that close to 70% of the companies it surveyed said it took them more than three months to recover from the supply chain and inventory disruptions at the onset of the pandemic, with retailers among those reporting the longest recovery times.
The report also found that manufacturers and retailers are more willing to move to what has been called “just-in-case” inventory management, with redundant supplies in stock, even if it means higher operating costs.
Retailers, especially, know the price of out-of-stocks is much greater than the $9.49 pricetag on a six-pack of Charmin, or the $12.49 for eight rolls of Bounty.
The supermarket customer who sees empty toilet paper and paper towel shelves at their local store may try Amazon for the first time and decide it is a better way to buy paper goods, forever. The Amazon customer who finds their go-to ecommerce source sold out might try Walmart.com, and decide it is faster, and cheaper.
When supermarket chains change hands, there is a reason why the new owners often try to make the turnover quickly, without closing the stores for more than a day or two, if possible. They know that consumers are creatures of habit, who are in the habit of shopping at the easiest, closest, most convenient option. Break that habit for too long, by closing a store for remodeling and rebranding, and the consumer will acquire a new habit, and may never come back.
The pandemic caused millions of Americans to break their shopping habits. Retailers are likely to be adding up the true cost of those out-of-stocks for years to come.
Lumber Prices Rocket Higher As Demand Overwhelms Supply
Lumber prices are rocketing higher with little relief in sight.
Prices for all categories of lumber break records as futures prices surge with no relief in sight for buyers. Demand destruction from high prices is sure to come, but when?
Closing prices on Friday, April 16, 2021 of Chicago Mercantile Exchange Random Length Lumber Futures contracts for every delivery month in 2021 were all above $1000 per board foot, with the spot, or nearest delivery contract for May 2021 settling at an incredible $1294.70.
For perspective, exactly one year prior on April 16, 2020 that very same May 2021 futures contract was trading at around $345. Not many asset classes can claim a 375 percent price increase in a year’s time, and lumber’s historic price rise will surely ripple through the building industry and the overall economy with consequences as yet unknown.
What’s certain now is that the futures curve is still not signaling when lumber prices might halt their relentless ascent and eventually head lower. We observed in both December 2020 and again in February 2021 that the lumber futures curve was inverted and relatively flat, meaning the nearby price of lumber was higher than the price of lumber further into the future, but that prices further out were not at enough of a discount to indicate an imminent easing of prices like happened in September of 2020, when there was a steep discount eight months out the futures curve of around 45 percent. Lumber prices declined shortly thereafter by about half in only six weeks’ time.
Right now though, the price difference between the May 2021 and November 2021 lumber futures contracts is about 22 percent, which in the lumber futures world simply isn’t enough of a discount to signal an impending price decline. Even the May 2022 contract, a full year out the curve from the current spot month, is priced at “only” a 25 percent discount. None of this is good news for builders or other professional buyers of nearly all grades of lumber, because they’ve got to have lumber to build, and the building season is hitting full stride as the calendar advances. These folks are paying up because they have no alternative, and there is no indication this trend will end anytime soon. The pros who use lumber will continue to buy what they need, if they can get it, even at elevated price levels.
A few signals are starting to emerge that could be harbingers of a change in trend. There are incidental reports that the price increases in lumber materials for DIY home improvement projects may cause consumers to redirect their attention away from lumber intensive activities to other endeavors, such as new appliances, landscaping upgrades, or even taking more vacations. Whatever their choice, less lumber will likely be in the consumer retail mix than last summer.
The first day or so many will rush to the grocery store to stock up on emergency food items, but it takes only a few hours in most places to empty the store shelves. Which leaves us no other choice but to survive on whatever food storage we have at home.
For the wise Americans that have been quietly preparing for the coming food shortage in America , they will not have to leave their homes for months, as they are well prepared , not only for the food shortage, but also in other ways.
- emergency power supply will be on hand, for many in the form of a small emergency electric generator
- gardens will be growing, especially in the summertime. In the winter the shelves in the basement will be lined with canned goods.
And not only are they prepared for the coming food shortage, they are saving money on their grocery bills, right now by doing that, so they are able to put extra money into savings to carry them through any emergency situation that may arise.
Regardless what your situation, it is foolish not to prepare for the coming food shortage that many experts are saying will happen eventually, and that could happen much sooner than we want to believe.
Should it never happen, there is nothing to lose. Having extra food on hand has never yet hurt anybody!
No chips, no cars
Automakers are contending with another kind of supply chain tie-up. As in other industries, many parts are arriving late at U.S. and overseas assembly plants because of COVID-19-related worker absences and a congested shipping system.
But the bigger problem is that while auto plants were shut down in March and April due to COVID-19, makers of chips – used throughout vehicles but especially in hybrid and electric models for safety, navigation and entertainment – diverted their auto-related production to consumer electronics, whose sales were surging. Chips were also channeled to medical devices, such as ventilators, and the data centers and cloud services that support teleworking, Fitch Solutions says in a research note.
Switching back that capacity to autos takes up to six months, says Kristin Dziczek, vice president of research at the Center for Automotive Research. The holiday shopping season only intensified demand for iPhones, tablets and other gadgets.
Without the chips, automakers can’t churn out vehicles. In January, Ford idled its Louisville, Kentucky, plant that makes the Ford Escape and Lincoln Corsair SUVs, according to research firm Cox Automotive. Fiat Chrysler shut down its Canadian factory that builds the Chrysler 300, Dodge Charger and Dodge Challenger.
Other automakers have simply cut back, with Toyota trimming production of its hot-selling Tundra pickup at its plant in San Antonio, Texas. About 2.8 million new vehicles sat at U.S. dealerships in early January, down from about 3.6 million in March, according to Cox.
“It’s very widespread,” Dziczek says of the production cuts.
As a result, car buyers may not be able to get the color or options package they want, says Cox spokesman Mark Schirmer. Dziczek expects the shortages to last at least through the first half of the year.
The Colonial Pipeline Crisis Is a Taste of Things to Come
The Colonial Pipeline system, which supplies nearly half the fuel consumed along the Eastern Seaboard, resumed full operations this weekend after a ransomware attack eight days earlier. Following days of higher pump prices, panic buying, and gas stations running out of fuel, the system is beginning to return to normal. But the lasting significance of Colonial Pipeline’s outage—the largest attack on the U.S. energy system in history—needs to be recognized. History will repeat itself with potentially far more severe consequences unless key lessons from the Colonial Pipeline attack are learned to boost the energy system’s resilience in the face of rising risks from cyberattacks and severe weather.
Colonial is one of the nation’s most critical fuel arteries, moving around 2.5 million barrels per day of gasoline, diesel, and jet fuel from Houston to New York, with branches serving southern states along the Atlantic Coast. As numerous economically struggling refineries shuttered along the East Coast in the past two decades, the entire region became even more dependent on Colonial for fuel.
On May 7, Colonial Pipeline shut down its pipeline as a precaution following a ransomware attack by a criminal group called DarkSide, which hacks into computer systems to hold data hostage until the victim pays a ransom. In response, gasoline prices surged in several southeastern states, and many stations ran out of fuel as people rushed to fill up their tanks. In Georgia and South Carolina, for example, the price of regular gasoline was up 8 percent this past weekend, and roughly half the stations reported having no gasoline. By Friday, the shortages had spread north almost 90 percent of stations in Washington had “no gas” signs up. It was reported that Colonial Pipeline paid a $5 million ransom to DarkSide to unlock its system and began to restart operations several days later.
Advocates predictably used the crisis to push particular agendas. The CEO of the American Petroleum Institute criticized decisions to shut down a pipeline in Michigan that supplies consumers in Michigan and Ontario, Canada and a pipeline carrying oil from North Dakota to Midwest refineries—even though neither had anything to do with supplying fuel from Gulf Coast refineries to states dependent on the Colonial system. Meanwhile, advocates of electric cars noted fuel shortages do not affect electric vehicle owners—even though the power grid is at least as vulnerable to cyberattacks as pipelines.
There are key lessons to learn from the Colonial outage, but it’s important to cut through the rhetoric and learn the right ones. Moreover, with shortages easing, policymakers need to resist becoming complacent and simply moving on to the next crisis. Three lessons are particularly worth heeding to reduce the likelihood and impact of a future energy supply disruption like the one the United States just witnessed.
The Biden administration has been in office barely 100 days and already faced two of the most severe energy crises in recent memory.
First and perhaps most obvious: The Colonial attack is a reminder of well-known cybersecurity risks to the energy system. Saudi Aramco, for example, suffered a significant cyberattack, likely perpetrated by Iran, in 2012, which forced the world’s largest oil company to shut down 30,000 computers and operate with typewriters and fax machines. In the United States, a 2018 cyberattack compromised the data systems of four natural gas pipeline operations. Moreover, cybersecurity risks to oil and gas may well rise not only as attackers become increasingly sophisticated but as the industry increasingly turns to tools of artificial intelligence and digitalization to increase production and reduce costs.
Driving an electric car in the Southeast may have provided peace of mind this time but does not insulate drivers from the risk of cyberattacks. Indeed, the electricity system faces significant and perhaps even greater cyber vulnerabilities. The FBI and U.S. Department of Homeland Security, in a highly unusual March 2018 report, publicly called out Russia for hacking the U.S. power grid and gaining access to critical controls that enabled them to cut off electricity. Although a cyberattack has not yet caused a widespread blackout, the risks can be seen in Ukraine, where Russian attackers shut down large portions of the grid in 2015 and again in 2016.
Moreover, the risk of cyberattacks may well rise as a decarbonized energy system becomes increasingly electrified, digitalized, and interconnected, as Amy Myers Jaffe wrote in her new book, Energy’s Digital Future: Harnessing Innovation for American Resilience and National Security. Moving away from fossil fuels means many energy uses, such as powering cars and heating homes, will increasingly depend on electricity, of which a growing share will be from renewable or other zero-carbon sources. A more electrified and efficient energy system, in turn, will involve more digital devices, from household appliances to self-driving cars, connected through smart grids and the “internet of things”—all of which expose the energy system to greater cyberthreats unless adequately projected. This past week, the chief economist of the International Energy Agency warned that because electricity is harder to store than fuel, an attack on the power grid in a world of electric vehicles would cause “an epic scale disruption with major social and economic implications.”
The U.S. government’s ability to protect against cyberattacks is constrained, however, because most of the country’s energy infrastructure is in private hands. The government can require some parts of the energy system, such as the high-voltage power grid and nuclear reactors, to adopt certain cybersecurity standards, but not others, such as oil and gas pipelines. Voluntary action is insufficient, however. As Colonial Pipeline demonstrated, the costs to the economy when a piece of critical infrastructure goes down are far higher than the costs to the particular company that owns it, so firm’s incentive to prevent it is inadequate relative to potential harm. That is a problem U.S. Congress should remedy by allowing federal agencies to set minimum cybersecurity standards for critical energy infrastructure.
The attack also hinted at how the United States’ own cyber capabilities may be used for deterrence. U.S. President Joe Biden pledged the government would “disrupt” DarkSide’s ability to operate. Shortly thereafter, the group’s website went offline, and it reportedly lost access to some of its funds. It then announced it was shutting down because of pressure from Washington. Whether DarkSide actually shut down because of anything the administration did remains unclear, but it would not be surprising if the federal government had reacted to deter other attacks on critical energy infrastructure, just as offensive cyber capabilities are a tool to deter state actors from attacking the United States.
Second, the attack demonstrates that energy security comes from being more—not less—interconnected. A half-century of calls for “energy independence” since the 1970s Arab oil embargo have too often taken the form of isolationism. House Republican Leader Rep. Kevin McCarthy, for example, argued the Colonial outage showed why the United States needed to produce more oil at home—even though the United States was a net oil exporter last month.
In reality, resilience comes from optionality and interdependence. The New York region was far less affected by the Colonial shutdown than the Southeast because it is more integrated into a fuel network with a more diversified set of port facilities, storage tanks, and other pipelines—and thus has more options to pull fuel supplies into the region from other refineries and from overseas when needed.
The risk of cyberattacks may well rise as a decarbonized energy system becomes increasingly electrified, digitalized, and interconnected.
This energy security lesson can be seen again and again around the world. When Hurricanes Rita and Katrina disrupted much of the Gulf Coast’s vast production and refining capacity in 2005, fuel shortages were averted by the ability to import supplies quickly from the global market. In Europe, increased energy security has come not from reducing Russian gas imports—indeed, European imports have consistently risen—but rather from implementing regulatory and infrastructure reforms that make the European market more integrated, promote competition, and create more pipeline reversal and interconnection capability. Bigger storage facilities and extra capacity to import liquefied natural gas makes Europe less vulnerable to supply disruption as well. During the Texas power crisis earlier this year, those parts of the state with grids connected to neighboring states fared better than the rest of Texas, which was served by an isolated electricity grid and transmission system.
Of course, building more interconnections and redundancy comes at a cost. The U.S. Southeast would be more energy secure if it were served by multiple pipeline systems rather than one or if its ports had the capacity and terminals the New York region has, but such investments would be expensive relative to how often they would likely be used. So the question is how much of an insurance premium people want to pay to guard against disruption. In any case, a policy that allows for free trade and competition in energy boosts energy security by maximizing optionality and system versatility.
Third, governments need to boost critical energy infrastructure’s resilience to increased risks it will face going forward, not just those it has faced in the past. The Biden administration took key actions to ease fuel shortages—temporarily easing air quality rules to allow the use of different fuel blends, rules limiting the hours truckers can work to deliver more fuel supplies, and restrictions on delivering fuel from the Gulf Coast on non-U.S. vessels—but the reality is the government had few tools at its disposal. (Although psychology matters too. Panic buying and price increases may have been more muted if the government had sent clear signals that it stood ready to intervene.)
Energy is the lifeblood of the economy. When pipelines shut down, the lights go out, or natural gas wells freeze up, the economy grinds to a halt and people lose access to mobility, heat, and other life-saving services. Nearly 200 people died in the Texas blackouts earlier this year, mostly from the cold, failed medical devices, and a lack of medical care.
Moving forward, the U.S. government needs to add new tools to its toolkit to respond to fuel shortages, particularly as the risks to critical energy infrastructure rise from both cyber and natural threats. Cybersecurity risks will proliferate as the energy system becomes increasingly electrified, digitalized, automated, and internet-based. These risks may come from unfriendly nations or, in the case of Colonial Pipeline, criminals looking to make a buck. Indeed, Colonial’s decision to pay the hackers a $5 million ransom payment may be understandable from the company’s standpoint but surely increases the incentive for future criminals to pursue similar attacks against the United States’ vulnerable network of pipelines, transmission grids, or other energy infrastructure systems.
At the same time, the risk of hurricanes, floods, droughts, and wildfires is rising with the worsening impacts of climate change. These natural disasters pose grave threats to energy infrastructure too, as the New York region learned during Hurricane Sandy, which disrupted fuel supplies and electricity for weeks. Federal investments in infrastructure, such as Biden’s proposal in Congress now, need to be resilient to tomorrow’s climate disasters, not just rebuild in the same ways as in the past, as several scholars argued this past Friday in the New York Times.
These events highlight the fragility and vulnerability of the United States’ energy system.
When considering how much the government should invest in resilience—in effect, how much insurance to buy—worsening cybersecurity and climate change risks may alter previous calculations. In 2011 and again in 2015, the U.S. Energy Department analyzed whether to build a strategic reserve of gasoline and diesel in the Southeast to protect against fuel supply disruptions, particularly from a major hurricane hitting Gulf Coast refineries, which happened during Hurricanes Katrina and Rita. Neither study was ever finalized, and there was significant disagreement within the Obama administration about whether the benefits of reduced gasoline price spikes justified the costs. Those cost-benefit analyses included certain assumptions about how likely major Gulf Coast hurricanes were to strike, yet those assumptions may well look different today given not only rising risks of severe weather from climate change but also rising cybersecurity threats as demonstrated by the Colonial attack. Although the Obama administration established a small gasoline reserve in the Northeast after Hurricane Sandy, the Biden administration should consider creating one in the Southeast as well.
The Biden administration has been in office barely 100 days and already faced two of the most severe energy crises in recent memory. These events highlight the fragility and vulnerability of the United States’ energy system. They demonstrate the breadth of infrastructure at risk—the electricity grid, oil and gas wells, and the country’s vast pipeline system. They underscore the diversity of risks posed, from cybersecurity to severe weather. And they should serve as a clarion call to the Biden administration, Congress, and private firms to move with greater urgency to bolster both the United States’ security of critical energy infrastructure and its resilience to inevitable disruptions. Energy is too important to all our lives and the economy to let this crisis go to waste.
Corona-Crisis Creates Massive Food Supply Chain Disruptions And Shortages
It's true, real food shortages and the threat of skyrocketing food prices this fall are being predicted not only by self-reliance types and survivalists. but by legislators, big banks and small farmers. Perhaps we won't go through this again.
Could This Happen Again?
But we are already going through some stuff. People are hitting the food pantries pretty hard. In fact. some lines are miles long. You've probably seen some of the pictures. Seems surreal in that the pics demonstrate an odd, out of whack situation where really expensive cars are in miles long lines to get a small amount of free food. Here's one such picture:
If it did happen again. would the initial stages look like this?
That's a lot of cars and a lot of hungry people I suppose. But the food pantries like the meat brokers are burning though current inventory. When it's gone, there will be issues reloading.
So far so good, right? But this fall could bring different problems. And that's if we all go back to work today. But as this drags on. each day we all stay at home means more issues. It's compounding. And it looks more like geometric or even exponential problems with supply chain issues.
This will turn into real suffering this fall and winter. Perhaps the likes which we haven't seen for a while here on this land.
But it's more than that. Americans who know their history understand all too well, suffering tends to bring out the ugly side in human nature. Right now, Americans just change channels when they see others hungry on television. But it seems America could be next.
The dollar is quickly losing value from printing money and the U.S. is still all too dependent on foreign food production. It comes as no surprise that grocery bills are rising faster than incomes. Wheat, corn, soybeans, bread, apples, beef, chicken, eggs, and milk. prices for these items are now rising to reflect the shortages and supply chain disruptions.
More and more "sheltered in place" Americans are feeling the pinch which now includes food issues. Many "experts" think we could be approaching the greatest disaster in the country's history. Many Americans are starting to prepare for the worst.
Remember, there are many ways to overcome food crisis.
It all takes prepping and planning, but there are sure to be some ideas that would work well for you and your family.
Depending on where you live and your land and storage opportunities, you can choose what makes the most sense.
Starting small will be key to continuing to grow your resources and supply.
In this way, it won’t take away from essentials if you are on a limited food budget. You will also want to keep stocking so that you can rotate through your food and not have any perish.
The most important thing is to get started.
It may seem overwhelming at first, but start with what you know. Take stock of what you already have and what you can use.
Then expand and grow your skills from there, and soon you’ll be ready for whatever the future brings including to be able to overcome food crisis.