Toilet paper was the first product to disappear from retailers’ shelves at the start of the coronavirus outbreak in the United States, but the nation’s meat and poultry producers warn the strain on the supply chain could result in shortages and cost increases.
“The food supply chain is breaking,” John Tyson, chairman of Tyson Foods Inc., the largest U.S. meat producer, wrote in a blog posted on the company’s website:
Tyson Foods is facing a new set of challenges. In small communities around the country where we employ over 100,000 hard-working men and women, we’re being forced to shutter our doors. This means one thing – the food supply chain is vulnerable. As pork, beef and chicken plants are being forced to close, even for short periods of time, millions of pounds of meat will disappear from the supply chain. As a result, there will be limited supply of our products available in grocery stores until we are able to reopen our facilities that are currently closed.
In addition to meat shortages, this is a serious food waste issue. Farmers across the nation simply will not have anywhere to sell their livestock to be processed, when they could have fed the nation. Millions of animals — chickens, pigs and cattle — will be depopulated because of the closure of our processing facilities.
CNN reported Tyson’s blog post also ran as full-page ads published Sunday in the New York Times, the Washington Post, and the Arkansas Democrat-Gazette.
“During this pandemic, our entire industry is faced with an impossible choice: continue to operate to sustain our nation’s food supply or shutter in an attempt to entirely insulate our employees from risk,” Smithfield Foods, the largest global pork producer owned by the Chinese WH Group, said in a statement on Friday. “It’s an awful choice; it’s not one we wish on anyone.”
“It is impossible to keep protein on tables across America if our nation’s meat plants are not running. Across the animal protein industry, closures can have severe, perhaps disastrous, repercussions up and down the supply chain,” the statement said. “Beyond the implications to our food supply, our entire agricultural community is in jeopardy. Farmers have nowhere to send their animals and could be forced to euthanize livestock, effectively burying food in the ground. We have a stark choice as a nation: we are either going to produce food or not, even in the face of COVID-19.”
Rep. Thomas Massie (R-KY), who is also is a beef rancher, spoke about the food supply chain on SiriusXM’s Breitbart News Sunday with host Joel Pollak.
“I’ll tell you why there will be shortages,” Massie said. “Right now there aren’t shortages because there was a supply of meat that was destined for restaurants, and the demand at the restaurants was curtailed when they were shut down. It’s frozen meat, and [restaurants] are repackaging it and diverting that supply to the grocery stores.”
“That supply is going to run out,” Massie said. “The [meat] pipeline has a crimp in it, and that’s at the processing plants.”
“A significant fraction of our country’s processing plants have shut down due to COVID,” Massie said.
Other members of Congress own cattle, but only a few of us RAISE cattle.
I fix the fences, feed the hay, castrate bulls, fertilize fields, put tags in their ears, move them between pastures, wean calves.
FOOD SHORTAGES ARE COMING.
USDA needs to acknowledge and respond now.
— Thomas Massie (@RepThomasMassie) April 26, 2020
Bloomberg News reported that the supply chain disruptions are not just in the United States but around the world:
[Tyson’s] comments echoed warnings from Smithfield Foods Inc., the world’s No. 1 pork producer, and JBS SA, the biggest global meat company, that consumers are likely to see meat shortfalls.
Almost a third of U.S. pork capacity is down, and JBS said Sunday it will shutter another beef production facility in Wisconsin. Brazil, the world’s No. 1 shipper of chicken and beef, saw its first major closure with the halt of a poultry plant, and key operations are also down in Canada, the latest being a British Columbia poultry plant.
While hundreds of plants in the Americas are still running, the staggering acceleration of supply disruptions is alarming. Taken together, the U.S., Brazil and Canada account for about 65 percent of world meat trade.
“Meat prices are surging on the supply disruptions,” Bloomberg News reported. “U.S. wholesale beef has surged to a record, and wholesale pork soared almost 30 percent last week.”
The Associated Press (AP) reported on the U.S. Food and Drug Administration’s (USDA) response to these developments:
The U.S. Department of Agriculture said late last week that it expects beef prices to climb 1 percent to 2 percent this year, poultry as much as 1.5 percent and pork between by from 2 percent and 3 percent.
The agency acknowledged that consumer buying patterns change weekly and that some products face supply-chain disruptions that could affect prices. But the USDA said its planned $3 billion purchase of fresh produce, dairy and meat should help stabilize prices. The government will work with food distributors to provide the purchased products to food banks, community and faith-based organizations and other nonprofits serving the needy.
The USDA last week reported 921 million pounds of chicken in storage and 467 million pounds of boneless beef, including hamburger, roasts and steaks. Before much of that meat could be sold at markets, it would need to be repackaged because restaurants buy in greater bulk than individuals. Some of the meat would need to be cut by grocery store meat cutters and packaged for customers to take home.
In late March, the USDA eased restrictions to allow for meat that had been intended for commercial food use to be diverted into the grocery store channels for consumers The industry sought these changes in mid-March after brief meat shortages caused by the coronavirus panic sent people scurrying to grocery stores.
Sarah Little, a spokeswoman for the North American Meat Institute, an industry trade group, said in the AP report, “It’s down across the board right now, so the next couple of weeks we should see how the system works. It’s never been tested like this before.”
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