Gigi reads from FoodWISE, on farms and resilience, and reports here on many relevant news articles:
Farm policy newsletter from University of Illinois yesterday (5/6/20) summarized several significant coronavirus-related food system news items from around the country. Many about meat.
- author: Keith Gold. Newsletter: “Farm Policy News”
- https://farmpolicynews.illinois.edu/2020/05/flipped-on-its-head-by-covid-19-some-food-sectors-scramble-for-new-equilibrium/
*From front page of LA Times (by Kevin Rector): “Rattling the Food Chain:”
“…the nation’s entire food industry has been flipped on its head by the COVID-19 pandemic. An intricate system for matching supply with demand, established over decades, has been thrown out of whack just as unemployment and food insecurity are skyrocketing among families.”
“…particularly severe in California, where more than a third of the country’s vegetables and two-thirds of its fruits and nuts are grown…”
- food service demand down, retail demand up – but not enough to compensate
- billions of dollars of produce had no buyers, went to waste, plowed under
“Few parts of the supply chain have been hit as hard as meat processing.”
*Will Sawyer in a recent report from CoBank (“Closed Meat Plants Today Mean Empty Meat Cases this Summer“) :
- meat supplies in stores will shrink, prices will rise
“U.S. hog producers may still be forced to euthanize as many as 7 million pigs in the second quarter alone, worth nearly $700 million at historical average prices. This would further diminish meat supplies this fall and add to the billions of dollars of losses from lower livestock prices.”
*Associated Press (Dee-Ann Durbin) Tuesday:
“As of Monday, U.S. beef and pork processing capacity was down 40% from last year, according to Jayson Lusk, head of the department of agricultural economics at Purdue University.”
*NY Times (David Yaffe-Bellany and Michael Corkery) Wednesday:
“Hundreds of Wendy’s restaurants have run out of hamburgers. Kroger, the largest supermarket chain in the United States, is limiting the amount of ground beef and pork that customers can buy at some stores. And Costco, where shoppers typically buy in bulk, has placed a three-product cap on purchases of fresh beef, poultry and pork.”
“Still, grocery executives say the shortages are only temporary and that most meat remains available, even if certain products have become more scarce. And some major meatpacking facilities have reopened…”
*Today’s Wall Street Journal (Heather Haddon):
“The beef shortages come as Covid-19 outbreaks have temporarily closed around 20 meatpacking plants, from Pennsylvania to Washington state, reducing the country’s overall beef production last week by 35% compared with last year’s level, according to U.S. Department of Agriculture data.”
*Bloomberg (Jen Skerritt and Lydia Mulvany):
“America’s meat-processing plants are starting to reopen, but not all workers are showing up. Some still fear they’ll get sick after coronavirus outbreaks shut more than a dozen facilities last month. Employees are taking leave, paid and unpaid — or just quitting.”
*Associated Press (Roxana Hegeman) yesterday:
“The attorneys general for 11 Midwestern states urged the Justice Department on Tuesday to pursue a federal investigation into market concentration and potential price fixing by meatpackers in the cattle industry during the coronavirus pandemic….the domestic beef processing market is highly concentrated, with the four largest beef processors controlling 80 percent of the industry.”
*Blog “Beef Marketing Margins“ (Jayson Lusk):
“When a packing plant goes down, the packers don’t need as many cattle… There is an excess supply of cattle given to the processing capacity. Thus, plant closures cause a reduction in demand for fed cattle. As a result, cattle prices fall.
“At the same time, a plant closure means fewer cattle getting turned into burgers and steaks. A plant closure results in less meat being on the market. There is a reduction in meat supply. Groceries and consumers are left competing for a smaller amount of meat, which results in meat prices getting bid up.”
*Financial Times [UK] (Emiko Terazono and Peter Wells) yesterday:
“Beyond Meat is readying for its plant-based burgers to compete directly with real beef on price terms in the supermarket cabinet, as coronavirus disrupts the US supply chain and drives meat prices higher.
“The higher relative price of plant-based meat substitutes has been regarded as a barrier to wider consumer acceptance in the past. However, as the spate of US meat processing plant closures has reverberated through the country’s food industry, wholesale meat prices have risen.”