By Denny Gulino
WASHINGTON (MaceNews) – Kroger, with 2,700 stores, says some of them will have purchase limits on ground beef and pork, just as many other grocery chains have been imposing for weeks.
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There is “plenty of protein” in the food chain, the Cincinnati-based chain said in its news release. Ground beef has been scarce at times at Wegman’s, Safeway and many other retailers although beef in frozen storage is reported to be at record high levels.
The cuts of beef backed up in warehouse freezers, though, are mostly sized for restaurant delivery and have to be reprocessed for direct retail sales. Repackaging up and down the food chain is expensive.
A couple hours north of the nation’s capital at just one of the sprawling poultry operations on four-lane Route 15 in Pennsylvania at least 100,000 chickens were smothered with foam and ploughed into the ground. The corona virus had taken too many workers out of action to do the slaughtering and processing.
On the Delmarva Peninsula, east of the capital, nearly 2 million chickens were wasted this week by one other operation, The New York Times reported. Same reason.
Meanwhile food pantries are beginning to pick up surplus produce and truck it into urban areas. The umbrella group Feeding America says more than 35 million Americans are experiencing some food shortages and long lines waiting for free food have become a routine sight.
The poultry supply chain is adjusting fast. The life cycle of chicken is not very many weeks. Hogs and cattle are a different story. Their slaughter can’t be delayed too long or they become unmarketably huge. And rebuilding culled herds take years, not weeks.
Some produce supply is very flexible, with supply lines from Florida, Canada and Mexico able to make big adjustments with short-cycle crops like beans, lettuce and tomatoes.
The well-publicized closings of meat packing plants and their reopenings set for the next few days will not bring back ill workers right away and productivity will be substandard.
Although not directly ordered by the federal government to reopen, as widely reported, the way was cleared by the declaration they are vital industries and so relatively immune from lawsuits from workers who might catch the virus at the workplace.
Grocery-store-sized five-pound bags of flour can be hard to find while warehouses are stacked with bags ten times as large that were intended for bakeries.
The industry publication Supermarket News reports dairy products have been big sellers, with more than 16% percent higher sales, a much-needed boost for the dairy industry, while deli meats are down 25% and more.
More noticeable gaps on grocery store shelves beginning in the week ahead will be the net effect of all the mismatch between wholesale and retail suppliers, the demand destruction from the closings of restaurants and school cafeterias and staff shortages at the processing level according to several food industry analysts. For many items that are on the shelves, prices will go up.
The lifting of at least some stay-at-home restrictions in 35 states in the week ahead may not restore overall demand to any large extent at first.
Consumers may not be as anxious to visit restaurants and stores as their proprietors are to reopen their dining rooms and patios.
Unease among customers isn’t helped by reports the White House is reducing the visibility of its foremost medical experts, the NIH’s Tony Fauci and the Task Force’s response coordinator Deborah Birx. The suspension of the daily Corona Virus Task Force briefings coincides with the refusal of the White House to let Fauci testify next week to a House Appropriations subcommittee.
Although House members are out of town, the subcommittee decided to hold the only hearing to be scheduled on Capitol Hill to get an update on the virus.
Consumer anxiety is also being renewed every day by still-high death counts and endless accounts of personal tragedy in the news around the clock. Total U.S. deaths are heading toward 67,000.
Tests per million people have not yet caught up to Canada and are far from what many medical experts consider adequate to reach some minimum type of virus containment. Testing won’t get to that point for many weeks, maybe months. Mass contact tracing, the other necessary control element, is still over the horizon.
New rumblings of an enlarged trade dispute with China also doesn’t help. Although few trade analysts take seriously White House threats of collecting virus reparations from Beijing, that country supplies a surprising amount of America’s food as well as medicine. China ships 90% of this nation’s vitamin C, 78% of tilapia, 70% of the apple juice and 50% of the cod to say nothing of all the tea and pet food, a total of more than $6 billion worth.
The White House focus now is on reopening the economy but many forecasts are that the economy will be slow to respond. If the reopenings spark a rebound in infection rates and, in three or four weeks, in hospitalizations, there may be very little near-term recovery as mitigation rules are put back in place in scattered locations.
The good news? The high-profile warning in some newspaper ads from the head of Tyson Foods, with 100,00 employees, that America’s “food supply chain is broken” prompted a wide spectrum of experts to declare he was overstating the case. While the supply adjustments being made are enormous, the consensus is they are mostly temporary.
Getting the food purchased, not the supply resstored, may be the bigger challenge. With more than 30 million Americans collecting unemployment benefits and more millions in the jobless pipeline many consumers will be watching their dwindling cash balances very closely.
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Contact this reporter: denny@macenews.com
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