I recently spoke at the Expana Agri-Foods Summit in Chicago. One of my early points was the reframing of what we think of as the food supply chain, into the more realistic value-add supply chain. I want to acknowledge the genius of Jason Robinson from AURI for the ah-ha perspective.
The term "food supply chain" has been used for decades to describe the complex process that delivers agricultural products to consumers. But is this really an accurate description of what’s happening? When we look closer, we see that the real driver of economic and societal benefit in the agricultural industry is not just the delivery of food—it’s the transformation of raw commodities into something greater. That’s why it’s time to reframe how we talk about this essential system.
The "Value-Add Supply Chain" is a more accurate and comprehensive term, reflecting the true nature of what’s taking place across agriculture and food production. Let’s explore why this new terminology better represents today’s agri-business landscape.
From Commodity to Customization: The Value-Add Journey
The term “food supply chain” emphasizes the end product, food. But in reality, it’s the transformation of raw commodities—like wheat, corn, and cattle—into a diverse range of products that create real economic value. Think of this transformation like turning raw milk into cheese. It's not just about converting milk into cheese, but also creating liquid whey, a byproduct that was once discarded as waste and is now a high-value protein powder. Every step in this chain takes a raw material and adds value, whether through processing, preservation, or packaging.
We are not just moving food from one place to another; we are adding value at every stage. The process isn’t linear in a strict sense, as side streams of byproducts can create entirely new industries, but it’s always moving toward a finished product that serves a specific market or consumer need.
A Dynamic System of Value Creation
Let’s think beyond "food" and consider how agricultural commodities are also transformed into non-food products such as biofuels, textiles, and even fertilizers. These transformations add value in multiple forms: form utility (processing and packaging), time utility (storage and preservation), and place utility (warehousing and distribution). By the time a product reaches the consumer—whether it’s a shopper buying groceries or an airline using sustainable aviation fuel—it has undergone a series of enhancements that multiply its value beyond the original raw material.
The "value-add supply chain" better represents this constant boost of economic and functional worth. It’s a dynamic system where inputs such as raw commodities are converted into products with greater utility at each stage.
Inputs and Outputs: A Broader Perspective on Agriculture
One of the shortcomings of the traditional "food supply chain" narrative is that it doesn’t account for the entire scope of agriculture. The real story begins before the food even enters the chain, with inputs like seeds, water, and fertilizer fueling the production of raw commodities. From there, the agricultural process feeds into the value-add chain, creating a circularity loop that ties together everything from food to fiber, fuel, and even pharmaceuticals.
To truly reflect this process, the "value-add supply chain" connects not just food production but the full spectrum of agriculture's outputs. From cotton for textiles to soy for biofuel, and from animal feed to food-grade oils, the system is much more than just food—it’s a vast network that adds value across multiple industries.
The Circular Nature of Today’s Agri-Business
In today’s world, the concept of a “linear” supply chain is increasingly outdated. We now see circular loops in many areas of agriculture. Byproducts that were once considered waste—like whey or corn husks—are now transformed into high-value products such as protein powders and bioenergy. In a value-add supply chain, nothing goes to waste; every byproduct can create its own new cycle of utility, further adding value.
This circularity underscores why the “value-add supply chain” is not only more accurate but essential terminology. It represents a modern system where inputs and outputs constantly feed back into one another, multiplying value along the way.
Memorable Terms to Anchor the Concept
To make this shift in thinking more accessible, here are some catchy new phrases:
"From Farm to Function": This phrase encapsulates the journey from raw agricultural production to products that serve a specific consumer need.
"Value Loops": Emphasizing the circularity within the system, where every byproduct can be repurposed into something valuable.
"Ag 360": Highlighting the full-circle nature of the modern supply chain, from inputs like seeds and water to outputs like food, fuel, and fibers.
"Function Transformation": This underscores the notion that every step adds a new layer of utility to the raw materials.
"Utility Chain": A reimagined way to talk about the value-added process where form, time, and place utility all come together to create value.
Embrace the Shift to “Value-Add”
Calling it the “food supply chain” is not wrong, but it is incomplete. By shifting to the term Value-Add Supply Chain, we acknowledge the multi-layered system that converts raw agricultural products into a vast array of high-value outputs, spanning industries and applications. Agriculture today is about more than just food—it’s about adding value at every turn, making it essential to reframe how we talk about this critical infrastructure.
Let’s redefine the conversation. The Value-Add Supply Chain is the heartbeat of modern agriculture, and it’s time we start calling it what it truly is.
Sam Alcaine founder of NorWhey. Photo cred Cornell.
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