“People Are Hoarding” – Supermarkets Are The Next Supply Chain Crunch
Food Shortages Persist
It’s been 19 months since the virus pandemic began, and supply chain disruptions continue, making it more difficult for customers to find their favorite item at supermarkets nationwide. Simultaneously, the psychology of empty store shelves and President Biden’s inability to normalize supply chains forced some people to panic hoard this fall as uncertainty about food supplies mount.
Chris Jones, Senior Vice President of Government Affairs & Counsel of the National Grocers Association, told Today, “shopping early for the holidays is a wise strategy, especially under current conditions.”
“There’s plenty of food in the supply chain, but certain items may be harder to get at certain times due to a nationwide shortage of labor impacting manufacturers, shippers and retailers. Additionally, lack of enforcement of antitrust laws in the grocery marketplace have allowed dominant retailers to secure more favorable terms and ample supplies of high-demand goods while leaving many smaller retailers with limited selections or, in some cases, bare shelves,” Jones said.
In a separate report, USA Today listed items that customers are having trouble finding at grocery stores.
Ben & Jerry flavors
This frozen treat is usually the perfect dessert, but in an email on Sept. 14, Ben & Jerry’s parent company, Unilever, cited labor shortages as the reason for reducing the amount of flavors produced. The company said it will focus on producing its most popular flavors. Phish Food lovers, you have nothing to worry about.
Fertilizer plants, which lead to the production of carbon dioxide, had to reduce their output because of rising costs, causing shortages in food and other products, Per Hong, senior partner at consulting firm Kearney, told CNBC. “We almost certainly will be faced with a global shortage of CO2 that is used widely. CO2 is used extensively in the food value chain from inside packaged food to keep it fresher longer, for dry ice to keep frozen food cold during delivery, to giving carbonated beverages their bubbles,” he said.
People have substituted fast food for home-cooked comfort meals, causing chicken to become scarce. In May, suppliers announced a shortage of chicken, which limited some restaurants’ menu items and increased the price in stores.
Brazil is a supplier of most of the world’s coffee, but the country has been experiencing a drought that slowed production and transportation of coffee beans.
Households with small children should be aware that diaper prices have increased because of increases in prices of raw materials, shipping delays and container shortages, according to Business Insider. Diaper manufacturers Proctor & Gamble (Pampers and Luvs) and Kimberly-Clark (Huggies) announced price increases in early April.
A customs dispute at the U.S.-Canada border has kept the Alaska pollock, which is used for fish sticks and sandwiches, stored across the border. Cross-border violations have halted transportation of the fish and may cause permanent seafood supply chain problems.
Rodney Holcomb, food economist at Oklahoma State University, told ABC27 News that concerns over the delta coronavirus variant have some customers buying more than usual, as Americans saw at the beginning of the pandemic, in case there is another lockdown.
Heinz ketchup packets
With restrictions on indoor dining, most people switched to pickup, takeout and delivery orders, limiting the supply of individual ketchup packets. Kraft Heinz confirmed to USA TODAY in early April that it was working to increase supplies, such as adding manufacturing lines that would increase production by about 25% for a total of more than 12 billion packets a year.
Marie Callender’s pot pies
The holidays call for comfort foods – even if you aren’t the one making it. But expect shortages of Marie Callender’s 10-ounce and 15-ounce pot pies. According to parent company Conagra, it would be allocating shipments through Nov. 29 after it “encountered packing material challenges from our tray and carton supplier resulting in a production interruption,” CNN Business reports.
McCormick Gourmet spices
With the holidays around the corner, meals being prepared across the nation may be missing a very important ingredient: seasonings. McCormick Gourmet spices are short of packaging supplies due to pandemic-related shutdowns. Lori Robinson, a spokesperson for McCormick, told CNN Business, “Gourmet is the only product line impacted by this packaging shortage” but can be substituted with their regular spices.
Rice Krispie Treats
This lunchbox treat’s production has been “below service expectations,” as stated in an email sent to suppliers. The shortage persists as Kellogg’s workers remain on strike, even though production lines have restarted as replacement workers were brought in.
Sour Patch Kids
In an Oct. 1 email to a grocery distributor, parent company Mondelez says there is “limited availability” on some of their items such as Sour Patch Kids, Swedish Fish candy and Toblerone chocolate “due to supply chain constraints.”
This is something that isn’t new to the pandemic shortage list, but the industry has yet to keep up with the demand. The shortage stems from lumber’s raw material, wood pulp, which is used to make toilet paper. Fox Business reports only 60% of orders are being shipped out. Some retailers, such as Costco, have reinstated purchasing limits.
Persistent disruptions in supply chains continue to upended daily life as supplies of essential goods at grocery stores continue to dwindle.
“I never imagined that we’d be here in October 2021 talking about supply-chain problems, but it’s a reality,” Vivek Sankaran, CEO of supermarket chain Albertsons Cos., told Bloomberg. “Any given day, you’re going to have something missing in our stores, and it’s across categories.”
Food suppliers are stocking up on extra supplies to mitigate panic hoarding. Saffron Road, a producer of frozen meals, is increasing inventory to about four months instead of two months.
“People are hoarding,” said CEO and founder Adnan Durrani. “What I think you’ll see over the next six months, all prices will go higher.”
Food producers are also complaining about the challenges in the supply chain continuing and will unlikely wane by the end of this year, suggesting these issues will continue into early 2022.
Last week, one of the top trending topics on Twitter was the hashtag #EmptyShelvesJoe, referring to Biden’s inability to normalize supply chains that have resulted in empty store shelves at supermarkets.
America is becoming more and more like a third-world nation as shortages and soaring food inflation crush the working poor.
(TLB) published this article from ZeroHedge as compiled and written by Tyler Durden
Header featured image (edited) credit: Empty store shelves/Charlie Riedel/AP
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