Food Shortages & Price Increases Ahead?

[BillTre]

Ever been to a restaurant supply?
Food portion sizes are often sold in quantities that are way beyond what a normal consumer would use.

 

[Vanadium 50]

Clearly the animals have to be slaughtered before they’re smooshed into patties.

If you just smoosh 'em first you don't have to worry about the slaughtering.

I know a little about McDonald's potato supply chain. Many of the farmers grow exclusively for McDonald's - that is, Farmer A sells to a single middleman B who has a single distributor C, who in turn sells exclusively to McDonald's. If McDonald's locks down, C loses most of his business, as does B and eventually A.

It's true that A can look for a B2, who's looking for a C2, who's looking for a new customer. But this takes time, and there are inefficiencies "those potatoes are too big/small/round/oval..."

But it's also true that more people eat fries out than eat them at home. So there is an overproduction in potatoes at the moment.

 

[TeethWhitener]

Ever been to a restaurant supply?
Food portion sizes are often sold in quantities that are way beyond what a normal consumer would use.

How much trouble is it to repackage? A lot of groceries package their own meat and fish in store. Are the portion sizes themselves too big (e.g. side of beef broken down in-restaurant) or are they just packaged by the thousand?

 

[256bits]

This is interesting. The Reuters article you posted stated that the producers aren’t “geared up” to supply grocery stores, which suggests that the process of slaughtering/butchering/etc. is different for grocery stores than it is for restaurants (or—maybe more likely—the logistics of the supply channels would require an unwieldy adjustment). But here you seem to suggest that it’s a matter of contract law, not physical ability of getting the animals slaughtered and to a point of sale. Do you mind clarifying if it’s one, the other, or both?

Edit: there’s some more info further down in the article. Things like liquid eggs or readymade eggs tend to go to restaurants (think the egg in an egg McMuffin), while eggs in cartons (which are also suffering a shortage right now) have to be graded and packed to go to grocery stores.

In a very simple description.
There is the futures market ( as mentioned ), the contract market, and the auction market (spot price ). Contract s between at least one enterprise and another.
Futures is bid and ask for a future day. Auction market is buyers bidding against one another.
Any one can do one or the other, a mixture, or all three. Of course, the size of your enterprise can lead to a favouritism of selection of the choices, If you are a large restaurant chain, you might want to enter into a contract with a large supplier, or many suppliers, and vice versa.. If you are a small unit you might opt for the spot price, or opt for a distributor fulfilling that role for you and paying his price for a side of beef, or the cuts ( if it is beef you want ). Same for the groceries stores and chains, and the mom and pop stores,

Since Covid and the restaurant closures, the news items are bearing out some of the difficulties being faced within the food supply chain.

 

[Tom.G]

My response here is a little bit from being exposed to parts of the industry over the years, and a little bit 'devils advocate.' Intended mainly to highlight that 'simple solutions' are often well hidden, when they exist.

This also kind of surprises me, in a few different ways. A lot of restaurants do receive meat portioned into individual sizes (though maybe not packed that way): think burger patties that fast food restaurants sell by the billion. But now my question is: how involved are the primary producers (farmers, ranchers) in packaging their products? Clearly the animals have to be slaughtered before they’re smooshed into patties. The eggs have to be laid before they’re liquefied. The switch from restaurants to grocery stores should really only affect farmers indirectly. The real effects would be further up the supply chain. I see why shutting down a processing plant is a big deal, because it closes a channel for the farmers’ goods. But the restaurant/grocery thing is a little beyond me.

As others have pointed out, many of the 'fast food' item are eaten mainly not at home. I just checked a retaturant supply business to find out their packaging for hamburger patties.

Hamburger patties come in counts of 20, 26 30, 40, 48, 60, 96 per case. All frozen and some precooked then frozen. Pricing is around USD $2 to $5 a pound, plus shipping.

Of course the production is all automated, including stuffing the patties in a cardboard carton at the end. Even those box-stuffing machines are expensive, large, and take several months to build, and another month or so to install.

So 'repackaging' to sell in the corner store requires either

• spending 100000s of dollars and a waiting to install a new machine

or

• hiring and training a bunch of untrained people
  (then the labor costs are much higher than using the packaging machine, so they have to charge more)
• finding sources for the new packages
• finding a place for the the new employees to work
  (they could rip out the old packaging line, but what to do with it?)
• purchasing and installing all the new furniture/equipment
• finding the new retail outlets to sell to
• finding carriers (truckers) to get the product delivered

Oh, and also take into account that the slaughter houses are shutting down now because the employees are coming down with COVID-19, so the packers can't get their raw material anyhow.

And there are probably hundreds of details I haven't thought of too.

Possible? Yes. Anyone have a good solution?

 

[chemisttree]

I don’t think there is one. Very unlikely that a company geared toward institutional sales would maintain an equivalent capacity or a flexible capacity to produce product for sale at retail stores. Even if they could, they would all be shut down anyway. Labor intensive work slaughtering animals.

Much more likely that someone could use produce or grains than animal products, though. An adaptable and rapid method for preserving the food value of vegetable products seems like a golden opportunity right now. How complicated would a large scale dehydration facility be? Could you build one as fast as a field hospital?

 

[hmmm27]

When life gives you lemons, make lemonade. But not hard-lemonade. Some alcoholic beverage producers have regeared to producing ethyl alcohol-based sanitation products.

Notwithstanding that their switchover environment is near monolithic in nature , as opposed to the active cooperation between companies necessary to rejig foodstuffs supply chain, it's a bit annoying that spirits' manufacturers seem to be the only ones with the organizational wherewithal to be useful to society, while maintaining their bottom line.

It is suggested that food overages could raise the overall health of the homeless and near destitute, their improved health somewhat mitigating future cost to society ;

Fatten up some zoo-bound animals ;

Produce veritable lakes of soylent-beige.

When producers can't get products to market... Shades of the "Irish Potato Famine," very local, gone global.

That famine lasted four years, killed off over a million people, and was directly responsible for the emigration of a million more.

Not being able to sit down and "enjoy" a Big Mac isn't exactly in the same ballpark. Apart from the visual of fields going fallow, an actual parallel might be to the US system that pays farmers not to grow stuff (of which I am at most only vaguely aware).

 

[Klystron]

When life gives you lemons, make lemonade. But not hard-lemonade. Some alcoholic beverage producers have regeared to producing ethyl alcohol-based sanitation products.

A reminder that fermentation represented an excellent long term storage solution for excess grain and fruit that would otherwise spoil. Ethyl alcohol content also provided a safer hydration alternative to historical common water sources.

That famine lasted four years, killed off over a million people, and was directly responsible for the emigration of a million more.

With the effects of the "blight" exacerbated by forced mono-culture from absent land owners, hateful politics and deliberate neglect; the last two ideas still prevalent.

 

[Dr. Courtney]

There may be some increase in expense and some supply chain issues.

But I doubt the average BMI of Americans will be lower a year from now than it is now.

I can't look at countries where so many poor people are fat through the same lens as countries where most poor people are skinny.

 

[Dr. Courtney]

Back when the Y2K bug was looming, I read a book called "Farming for Self-Sufficiency" and also studied and began doing some small scale food preservation and storage for our household. Another book I found useful in preparing for various TEOTWAWKI scenarious is "Where There Is No Doctor."

Our household is nowhere near true self-sufficiency in either food or medical care, but we are capable of a higher level of independence for a longer duration than most US households. Whether one is preparing for a winter storm or a hurricane that can knock out power and interrupt supply chains for a couple weeks, or perhaps preparing for a longer supply chain interruption, many of the principles are similar.

Many hunters think there'll be plenty of large game available to feed families indefinitely if grocery store shelves are bare. But a careful look at the math suggests a lot of the most commonly hunted game can't feed millions of Americans for very long. Being able to effectively trap smaller animals that fewer people are targeting will likely provide protein for longer. There is a program on BlazeTV called "In the Quarantine with Phil (Robertson)" where more practical skills are discussed in a more helpful level of detail.

But most of the time, a given acreage of land will provide more food if carefully cultivated and used for plant-based nutrition than if used for animal-based nutrition. Sadly, most Americans no longer have the knowledge and skills to extract the nutritional potential from a few acres of land. I don't think the current "crisis" will be the one that pushes America back to needing to do that. But if one looks at world history, continuous supply chains for hundreds of years are relatively rare events. Odds are good that at some point in the next generation or two, supply chains in the US will be significantly interrupted for more than a couple weeks.

 

[TeethWhitener]

Sadly, most Americans no longer have the knowledge and skills to extract the nutritional potential from a few acres of land.

Most Americans don’t have a few acres of land, so there’s no reason to expect them to retain such knowledge.