IRVINE, CA - The impacts that COVID-19 will have on our industry are slowly becoming more clear, and buyers and suppliers are pivoting to mitigate the damage. Thus far, foodservice has been met with much adversity, but how will that weight shift as time progresses? In the interest of produce suppliers across the country, Western Growers has sent out a letter requesting that the USDA take action to guarantee the payment of all contractual PACA obligations.
“In this crisis, an issue that is of a growing concern is that, given the extremely volatile environment currently in the food supply chain, the likelihood of delayed payments or non-payments and the drain on cash flow will be much greater than could have ever been forecasted,” Dave Puglia, President and CEO of Western Growers, began in the letter. “Indeed, many of our members are already facing repeated requests from their buyers for payment extensions beyond the standard 30 days. This concern is especially acute within the foodservice sector.”
As fresh produce suppliers continue working to ensure a safe, healthy, and consistent supply throughout this challenging time, it is essential that they are being protected. To prevent further disruption along our fruit and veg supply chain, Puglia suggests operators require support from the government and each other. And, as we all know, that supply chain starts wherever the food is planted.
“While PACA has for decades served our members well in safeguarding them from credit risks and lost inventory, we fear the existing process may not be enough to withstand the unprecedented financial losses our growers stand to experience,” Puglia continued. “As such, we request that USDA take action to guarantee the payment of all legitimate PACA Trust claims, to the extent these claims are not satisfied by the available PACA Trust assets.”
Puglia concludes the letter by emphasizing that these measures will reinforce the fresh produce supply chain and ensure a strong and safe industry throughout this challenging time as well as after it passes. To read the letter addressed to Secretary Purdue, click here.
Keep coming back to ANUK as we deliver you the latest news surrounding COVID-19 concerns as they pertain to fresh produce.
