November 19, 2021
Big Birds, Big Bills
Thanksgiving provided a concrete example of rising food costs and the effects supply chain issues are having on food production. This week, the most influential voices in the business discussed:
- Food prices at a decade-long peak
- Turkey talk, which has crescendoed ahead of the holiday
- Interesting highs and lows
Prices Take a Hike
As supply chains adapt to the new normal, the costs of making and buying food have risen. Concerns about prices have been elevated for food producers and consumers since the beginning of the pandemic, but media coverage ramped up ahead of Thanksgiving and the holiday season.
- In its most recent Food Price Index, the U.N. Food and Agriculture Organization found that global food prices rose 3.9% in October, reaching the highest level in a decade.
- Purdue University agricultural economist Jayson Lusk explained in Econofact, “Wage rates in the food industry have significantly risen over the course of the pandemic and these higher wages get reflected in higher food prices.”
- Meanwhile, activist group Food & Water Watch attributed some price hikes to retailer consolidation in a report titled “The Grocery Cartels.”
- The New York Post lamented that budget pizza joints have had to raise per-slice prices despite marquees that declare “$1 pizza.”
- Specialty Food Association offered advice to manufacturers looking to address the “current pricing situation.” In addition to assessing options like smaller packaging, the article suggests that brands ask: “What price can you live with? What price can you grow with?”
- But not every company has been hurt by rising prices: Walmart (Wall Street Journal) and Tyson Foods (Food Manufacturing) both reported higher earnings this quarter. Meanwhile, Wingstop CEO Charlie Morrison told Meatingplace that wing prices are “trending in the right direction.”
- American Farm Bureau estimated that the average cost of Thanksgiving dinner for 10 people increased by 14% to $53.31 … which brings us to the next topic.
The Big Turkey’s Back
After the pandemic led many to stay home last year, Thanksgiving is poised to make a major comeback. A record number of Americans plan to host larger gatherings with extended family and friends. But, the return to semi-normalcy has brought vaccination status back into the conversation, causing potential conflicts leading up to turkey day.
- 47% of Americans claimed that they plan to host the holiday dinner this year, a record percentage, reported Specialty Foods. That’s up from 41% in 2020 and 33% in 2019.
- With the cost of Thanksgiving dinner on the rise, many are looking for ways to save. The Washington Post offered money-saving tips, while Meat+Poultry highlighted affordable Thanksgiving meal options from Aldi and Meijer. Of course, it’s cheapest to let one of the 47% of your neighbors host this year.
- CNN wrote that turkey producers stocked up on bigger birds to account for bigger events this year.
- Many Americans are planning larger Thanksgiving celebrations, and dinner guest immunization status has become “a topic of conversation, concern and conflict,” noted The New York Times.
- Apparently, finding the perfect Thanksgiving wine is imperative. The Washington Post provided strategies to help limit stress on your quest for “the one,” and recommended a “food-friendly” pinot noir. The New York Times presented its “no-sweat” guide to Thanksgiving wine selection, and suggested 12 wines for “Thanksgiving and beyond.” Finally, The Wall Street Journal declared dessert wine as the finale your holiday feast deserves.
- Salt & Straw, an ice cream maker from Portland, Oregon, is again offering its full Thanksgiving meal in ice cream form. This year’s flavors include: Parker House Rolls with Salted Buttercream, Caramelized Turkey & Cranberry Sauce, Candied Walnut Cheesecake, Sweet Potato Pie with Double Baked Almond Streusel, and vegan Pumpkin & Gingersnap Pie (Food & Wine).
We all know tractors are sexy. That’s why they’re part of our attempt at a hot-or-not list capturing some of the trends and non-trends spanning food production from farm to fork.
- HOT: Baking. The NPD Group reported that baking at home is still a hot trend, despite decent vaccination rates and lives starting to resemble normalcy. NPD cited a 42% increase in sales of baking cookbooks and continued interest in streaming baking TV shows.
- NOT: Plant-based Protein. Food Business News interviewed Chris DuBois from IRI to discuss reasons behind the well-publicized decline in alternative protein sales: “The products don’t meet the consumer’s perception of clean, companies in the category have not proven their products are more sustainable than conventional meat products, and competition.” Purdue ag economist Jayson Lusk acknowledged and helped quantify the slump, but underscored that demand in foodservice may indeed be up. Meanwhile, Swedish alternative milk maker Oatly’s stock tanked 20% after having quality issues and production delays (The Guardian).
- HOT: Tractors. Sustainable food fund Astanor Ventures led a massive series B capital push, channeling $61 million to autonomous tractor maker Monarch (Yahoo News). Supply chain issues and a strike at John Deere — finally resolved this week (Gizmodo) — both contributed to a huge spike in used tractor prices (The Counter). Finally, Case IH rolled out its revolutionary Patriot 50 sprayer which “feels planted to the ground,” according to Case IH marketing manager Mark Burns (Progressive Farmer).
- NOT: Plastics. The issue of what to do with packaging waste was of interest this week. Civil Eats editor Matthew Wheeland criticized how the pandemic increased plastic use. The Consumer Brands Association called for standardization of recycling systems. And Meijer teamed up with Dow to pave a parking lot with 12,500 pounds of recycled plastic bags.
Some important points of view worth checking out this weekend.
And the Predictions Begin …
Better-for-you options and sustainability will drive restaurant menus in the coming year, the National Restaurant Association predicted in the What’s Hot Culinary Forecast. After turning to comfort foods during the pandemic, the association noted that consumers are refocusing on foods “believed to have immunity-boosting qualities.”
GreenBiz discussed the ethics of insect farming, also known as “mini livestock,” a business expected to exceed $1 billion by 2023. Author Matan Shelomi explored the topic from environmental resource consumption and animal care perspectives. Also in question is the astonishing number of creatures involved: more than a trillion individual insects are farmed annually for food and feed, and the industry is young.
Modern Farmer’s Dan Nosowitz explained how Simplot’s bioengineered (BE) strawberries will likely be in stores within a few years. Because these strawberries employ gene-editing technology CRISPR, the process is less intensive than full-blown GMOs and require only switching on and off genes within the species. The goal is to extend shelf life and conserve water. Bonus: GMO corn may soon be grown in China (Reuters).
An article in The Wall Street Journal described discussions and debates over religious bans on eating pork amid the emergence of plant-based alternatives. Both Jewish and Islamic groups, which prohibit the consumption of pork, have advised against eating products like Impossible Pork. However, Jewish authorities have allowed the consumption of Impossible cheeseburgers (the faith typically bans the combination of meat and dairy). So, chili cheese fries would be OK by this logic as well, further distancing alt-protein from the better-for-you sector.
Onion Drug Rings
A Polish truck driver attempting to enter the United Kingdom was found with 418 kilos of cocaine hidden in a load of frozen onion rings. Authorities estimated the drugs had a street value of around $44 million (Food & Wine). It seems that describing food as tasting “like crack” may not always be metaphorical …
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