And on top of that the combination of omicron and bad weather is causing more people to stock up - and then eat at home. JL
Laura Reiley reports in the Washington Post:
It’s barely 2022 and already social media is swamped with pictures of empty grocery shelves — from cream cheese to paper towels, children’s juice boxes and cat food. Here are some of the reasons: omicron has meant more employees can’t work due to illness or quarantine on top of being down 80,000 truck drivers nationally, and 10% of workers being absent at food manufacturing facilities. (Plus) "we’ve seen weather patterns we’re not used to in frequency and magnitude, from the West Coast to the East Coast.” (And) more people are eating at home.Here are some of the reasons an array of your favorite items may be out of stock at grocery stores.
Omicron’s surgeThe omicron variant surge has meant more work for stores — more deep cleaning, a return to masking and social distancing — just as more employees can’t work and are calling out due to illness or quarantine.
In a Monday call with 27 food industry chief executives, Geoff Freeman, CEO of the industry organization Consumer Brands Association, said more employee absences were reported in the past two weeks than in all of 2020.
“That’s remarkable,” he said. “Throw on top of that being down 80,000 truck drivers nationally, and another 10 percent of workers being absent at food manufacturing facilities, and you’re putting a lot of pressure on the system all at one time.”
Covid has swept through supermarket chain Stew Leonard’s, which has stores in Connecticut, New York and New Jersey. Some 200 of its 2,500 employees are out sick or in quarantine, said owner Stew Leonard Jr.
“It puts a challenge, for example, on making every kind of pizza you want: The pineapple and ham pizza, we’ve decided not to make,” Leonard said. “And most manufacturers out here have done the same thing. Everyone is hit with a shortage of labor. Some because of the Great Resignation, but a lot of it is the omicron surge.”
Access to rapid coronavirus tests is also making it challenging to get employees back to work swiftly, he added.
“Two weeks ago, our No. 1 selling item at Stew Leonard’s was filet mignon. Right now, the No. 1 seller is the rapid tests. We have a warehouse in New Jersey where we pick them up. We sent a tractor trailer and asked them to load them up. They said, ‘Not so fast. How much do you want to pay for them?’ It was a bidding war right there on the loading dock.”
The National Grocers Association has requested its grocers be prioritized for testing supplies from federal and state governments, and they’ve also asked for flexibility with new federal vaccination and testing mandates with the aim of minimizing further workforce disruptions, said Jim Dudlicek, the trade group’s communications director. With the prevalence of the omicron variant, even among vaccinated workers, many grocery chains are operating stores with less than half of their normal workforce, which makes it harder to stock and display grocery items or to prepare foods made on-site.
“While there is plenty of food in the supply chain, we anticipate consumers will continue to experience sporadic disruptions in certain product categories as we have seen over the past year and a half due to the ongoing supply and labor challenges,” Dudlicek said.
Winter weatherWinter storms dumped more than a foot of snow across parts of the Mid-Atlantic just after the New Year, and sweeping weather systems have made road conditions difficult in many parts of the country in the past two weeks.
For example, the 20-plus-hour traffic jam last week on I-95 near Stafford, Va., paralyzed a fair number of grocery delivery semi trucks.
“The winter months are always challenging,” said Doug Baker, vice president of industry relations for FMI, a food industry organization. “But we’ve seen weather patterns that we’re not used to in terms of frequency and magnitude, from the West Coast to the East Coast.”
In addition to weather delaying the delivery to grocery stores around the country, Baker said bad weather also influences consumer psychology, which played into some items getting sold out.
“There are certain products people ritually buy when there is an impending weather event,” Baker said. “And then when people see images of stores low on stock, it’s not out of the ordinary for people to buy two of something instead of one, just in case.”
And with more than 5,000 schools delaying their reopening this month due to the omicron surge and storms, families are feeling a greater urgency to lay in supplies of bread, milk, meat and cereal to make up for meals not eaten at school.
Supply chain snarlsSupply chain problems are no longer just about shipping containers sitting in ports or out at sea, waiting to be unloaded. They are also about the slowing of the production of goods that the United States imports.
In China and the United Kingdom, some municipalities have once again shut down factories and thus slowed orders for certain ingredients and food products for U.S. imports.
“A lot of our ingredients and products come from countries that have had their own spikes,” Baker said. “Some countries have taken a very strict approach and shut down manufacturing, so that slows the whole process down. It’s not just a domestic issue, it’s about how other countries are dealing with omicron.”
Still, at the nation’s busiest port, the Port of Los Angeles, cargo volume fell sharply in November compared with a year earlier, according to the port’s own figures.
Fruits and vegetables have seen fewer instances of shortfalls and supply problems than other food categories, but currently there are some empty shelves that are more about food safety. The Food and Drug Administration last week issued a voluntary recall on certain bagged salads and other vegetables due to possible listeria contamination. In general, though, there have been fewer food recalls during the pandemic.
More people eating at homeA combination of factors from rising inflation to surging omicron cases are prompting households to eat at home more — meaning grocery stores are being inundated with shoppers once again.
Grocery sales climbed more than 8 percent in December, according to national retail sales tracker Mastercard SpendingPulse. Stores are still restocking from that surge and have been struggling to keep shelves fully stocked in several categories since the beginning of this year, according to data firm IRI’s consumer packaged goods supply index.
“We’re seeing a lot of restocking and replenishment going on,” said Jessica Dankert, vice president of supply chain for Retail Leaders Industry Association. The heavy shopping season has come at a particularly difficult time, coming out of the holiday period, when families traditionally cook more at home anyway.
Widespread storms and the increased hesitancy around dining out because of the omicron surge have contributed to more demand at grocers.
Also, in some cities, restaurants and other food service establishments had to close temporarily due to covid outbreaks among workers, which sent even more families to dine at home in December.
“You’ll see that replenishment build back up,” Dankert predicted, “but we’ll see these disruptions for months to come.” Inflation has also been influencing consumer behavior, driving them to eat more at home and travel and eat out less.
Grocery prices rose 6.4 percent over the past 12 months ending in December, the largest increase since 2008, according to a Bureau of Labor Statistics index of prices. And for subcategories such as beef, prices rose a staggering 20.9 percent.
Datassential’s analysts say consumers turn away from restaurants and back to home dining when food prices surge. Restaurant-going becomes more of a splurge. Couple that with consumer hesitancy due to omicron, and consumers are swinging back to eating more grocery store food.
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