Kroger CEO Rodney McMullen wants to reassure you: His stores have meat. But he can’t make promises about what kinds of meat.
“If you’re flexible on eating between chicken, pork, and beef — we constantly have one of those items in, or two of those in, usually three,” the CEO of America’s largest grocery-specific retailer said in an interview on CNBC last week. That actually makes things sound a little more grim than they usually are; McMullen said every store he has personally visited had at least two of the major meat proteins in stock.
Meat is the latest focal point of household-goods shortages, but the mechanism causing the shortage here is different than for goods that were in short supply in March and April. Most of the early shortages came from demand-side shocks: Consumers were stocking up because they were afraid goods would be in short supply later (toilet paper, dried beans) or were buying more because their consumption behavior had changed in the epidemic. For example, McMullen says Kroger’s yeast sales are up 600 percent as people bake more at home.
Some of these shortages have abated significantly as producers have ramped up supply, and traffic volumes at grocery stores have also returned toward normal — although disinfecting wipes (and yeast) remain hard to find, a sign that rising sales of those products were not due to hoarding but persistent increases in household usage. In some cases, getting the product you want may still require being flexible about brand, flavor, or packaging. J.M. Smucker’s warning back in March that it was having trouble filling grocers’ orders for Jif-brand peanut butter matched my experience in grocery stores this week. My local Gristedes had no jars of regular, creamy Jif, but you were in luck if you were willing to buy low-sodium Jif, Jif in single-serve packets, or Skippy. At Wegmans at the Brooklyn Navy Yard, Jif was unavailable, but store-brand peanut butter was not only plentiful but on sale at $1.19 per 18-ounce jar. So it’s safe to say there is no peanut-butter crisis.
The meat and poultry shortage is different from the prior shortages because it comes from the supply side, as many processing plants have been forced to close due to coronavirus outbreaks, so the supply of product to supermarkets has been constricted. The quantity of cattle being slaughtered in the U.S. is about 30 percent below normal due to these disruptions, and that means less beef available to retailers and consumers. This supply-side pressure may then be exacerbated by changes on the demand side, as consumers stock up on meat out of fear that supply problems will get even worse.
To fight the stock-up urge and ensure ongoing availability, retailers have been imposing limits on how much meat any one customer can buy. At the Brooklyn Wegmans, signs tell customers they can buy no more than two packages of ground meat. At Whole Foods in Commack, in the Long Island suburbs, the anti-hoarding measures take on a decidedly more upscale flair, declaring that in addition to restrictions on chicken and hot dogs, customers can buy no more than three bone-in rib steaks, weighing no more than a total of seven pounds. Even Costco is limiting its members to purchases of three meat and fish items. But despite these restrictions, retailers have been running out of certain kinds of meat at certain times. For example, at the Commack Whole Foods, chicken was available but mostly limited to air-chilled Bell & Evans products, which are high in flavor but cost $7 a pound for bone-in breasts.
While Wegmans and Whole Foods were both deeply weird places to shop this week — Whole Foods had a 15-minute line to get in at 2 p.m. on a Tuesday; Wegmans had shortages of seemingly arbitrary goods, like Entenmann’s baked products — my neighborhood Gristedes was almost eerily normal. The meat and seafood case was full with the usual selection of products, including typical, non-premium chicken. So neighborhood stores may be a place to consider if you’re having trouble finding what you want at the big supermarkets. Of course, one reason customers flock to the bigger, more-depleted stores is they really do have lower prices: Peanut butter was nearly four times more expensive at Gristedes than at Wegmans; bananas were priced more than 50 percent higher.
According to Bureau of Labor Statistics data released Tuesday, prices for food for home consumption rose materially in April, up 2.6 percent from a month earlier and 4 percent higher than a year earlier. Fresh pork products especially spiked in price. A few weeks earlier in its April release, the Department of Agriculture’s Economic Research Service had forecast modest food inflation of only 0.5 percent to 1.5 percent for the whole of 2020, in part because a higher price outlook for meat and eggs was offset by downward adjustments in price forecasts for seafood, fresh fruits, and fresh vegetables. In theory, reduced school and restaurant purchases of fresh produce and seafood should tend to flow through as lower prices at supermarkets. There were some examples of produce deals on display at supermarkets last week: Wegmans and Whole Foods were selling conventionally produced bananas at 49 cents a pound this week, significantly below the recent national average retail price. But so far, the average price trend actually experienced in supermarkets appears to be upward, even for produce and seafood, according to the BLS data.
Wesley Rose, who leads global seafood purchasing for Whole Foods, told me the chain has taken advantage of restaurant closures to significantly increase its purchases of certain kinds of premium seafood. Lobster, for example, is much more available, due to the closure of many restaurants that would ordinary serve it. The chain opportunistically bought “a lot” of lobster meat that was originally destined to be served at Luke’s Lobster locations and promoted it heavily over Easter weekend, he said. He also noted the chain has recently promoted wild halibut at $15 per pound, the lowest price he’s ever seen. That said, these are not exactly perfect substitutes for beef and chicken. Even at much-reduced prices, they remain relatively expensive, and many consumers are unfamiliar with how to prepare seafood at home. At Whole Foods in Commack, the chicken case was more than half empty and the meat counter had a line, while the fully stocked seafood counter had no wait.
For many kinds of goods, you can expect supplies to become more steady and reliable even as the coronavirus crisis continues, as manufacturers ramp up production. Clorox expects to be meeting the increased demand for disinfectant wipes by summer. But meat supply disruptions are likely to persist as long as meat-processing facilities are vulnerable to coronavirus outbreaks. Tyson Foods has told investors to expect disruptions in its ability to supply meat and poultry for the rest of its fiscal year, which runs through September 30. So it may be worth brushing up on those seafood and vegetarian recipes if you plan to continue cooking at home this summer.
