Pandemic both boom and bust for food industry

Hoarding, volatility of food markets force producers to adapt

Grocery shopping just looks different now — be it the lines on the floor directing shoppers where to stand, to the safety reminders over the store PA, to the empty space where the flour used to be.

For food producers, it’s also a strange new world with restaurant and food-service orders abruptly nixed and the sudden consumer desire to stockpile. For some, this is a boom time. For others, it’s a definite bust.

Why it matters: In a matter of weeks, food demand has radically shifted as events cancel and people are forced to eat at home due to measures taken to limit the spread of the coronavirus.

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The busts

“There’s simply no playbook for this,” said David Weins, chair of Dairy Farmers of Manitoba. “All of this (dairy supply chain) has been designed for normal times.”

On April 3, media was reporting that dairy farmers in Saskatchewan and other areas of Canada were dumping raw milk due to a drop in demand.

Weins said in Manitoba raw milk hasn’t been dumped yet, but skim milk byproduct has been discarded. As part of the Western Milk Pool, dumped milk in Saskatchewan costs Manitoba farmers, he said.

Much of the drop in demand is owing to the shutdown of the food-service industry, which required a lot of cream and cheese, Weins said. Demand has shifted somewhat to retail, but this hasn’t made up the deficit as supply chains struggle to adjust.

Meanwhile, said Weins, the cost of some supplements used in feed, like cornmeal from ethanol plants, has gone up as some of those plants have shut down.

Unlike a factory, it’s not as simple as reducing production, Weins said. The cows must still be milked. If they reduce cow numbers, it may be tough to ramp back up when demand regulates.

Fish producer Rudy Reimer said demand for his steelhead trout was cut almost in half when restaurants closed doors.

“That is a huge impact,” said Reimer, who owns Watersong Farms near Warren.

Reimer direct markets some vacuum-packed, frozen fish and has seen direct sale demand increase as people seek to stock up. However, he said retailers aren’t accustomed to getting fish frozen, preferring “just in time” delivery so he hasn’t been able to capitalize on shoppers’ desire to buy bulk.

Reimer added that some retailers have stopped getting fresh fish from other countries, which has boosted local demand for his fish somewhat.

The booms

Meanwhile (probably in part due to all those folks baking bread at home and posting it on social media), Prairie Flour Mills in Elie said demand spiked around 30 per cent in the last few weeks.

“We are actually starving for bags right now,” said Clayton Manness, the company’s president and CEO.

“We are moving bags around. We’re telling customers we’re out of 2-1/2s (kilogram bags) so you’ll have to take fives. Basically we’re out of 10s right now so you’re going to have to take fives. We can’t do anything about it,” he said.

Manness said they’ll get a fresh stock of bags soon, though he suspected demand would settle out soon.

“I expect it to fall back and maybe drop below the normal,” he said. “There are a lot of questions waiting to be answered.”

There’s also been an increased demand for eggs, said Cory Rybuck, general manager of Manitoba Egg Farmers. With flocks in barns for a year, there’s no need to ramp up production and he hasn’t heard of shortages yet, he said. Manitoba generally exports eggs to other provinces.

Manitoba Egg Farmers’ chief concern is that supplies continue to go to farmers, Rybuck added.

Pasta has also been flying from shelves. Italpasta, based in Brampton, Ontario, reported a 30 per cent increase in demand.

“They’re taking everything we’re manufacturing. As a matter of fact, our warehouse is empty,” said Joe Vitale, Italpasta owner and president.

Italpasta has cut production to the six most popular cuts of pasta (spaghetti, spaghettini, penne, elbows, lasagna and fusilli) from its usual 63.

“Because every time we have to change a die to make different pasta we lose about three hours,” Vitale said.

The plant has expanded its work week to seven days from five and hired more workers, Vitale said. Workers’ temperatures are monitored each day, and they’re provided masks and gloves along with other safety precautions. They’ve also been given a raise, Vitale said.

Vitale said he hoped that as Canadians and retailers thought more about the food system than they might normally, they’d see how Canadian producers are keeping the shelves full.

“When it comes to pasta, there is no difference between our pasta and some of the best pasta that comes from other parts of the world,” he said. “In the future, we should concentrate more on buying Canadian.”

­— With files from Allan Dawson

About the author

Reporter

Geralyn Wichers

Geralyn Wichers grew up on a hobby farm near Anola, Manitoba, where her family raised cattle, pigs and chickens. Geralyn graduated from Red River College’s Creative Communications program in 2019 and was previously a reporter for The Carillon in Steinbach. Geralyn is also a published author of science fiction and fantasy novels.

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