“The way a customer describes it is that they see a tsunami of demand going from catering to retailing of food,” said Bahige El-Rayes, a partner who co-directs the practice of consumption and retail at Kearney, a consulting firm. “If you are a food manufacturer today, this is basically how do you adapt? How do you actually take what you send to restaurants and then retail it now? “
New alliances are formed as demand for restaurants dries up and consumers are looking for new delivery methods. Kroger, the largest supermarket chain in the United States, has partnered with restaurant giants Sysco and US Foods, which normally supply the restaurant industry and large institutions, to share the workforce and keep the shelves of stores supplied.
Partnerships provide jobs for food service workers who would otherwise be laid off or laid off as a result of the near closure of the restaurant industry. It also provides a vital workforce for the overwhelmed food retail industry.
The rewiring of the American food network is however accompanied by logistical headaches.
“Since we buy more at the grocery store, it means [food items] must be in this form, “said Pat Westhoff, director of the University of Missouri’s Food and Agricultural Policy Research Institute. “We have a lot of stuff that is still blocked by restaurants, and they are trying to decide what to do with it at this point. “
Farmers are also struggling to recalibrate their production.
Richard Guebert Jr., president of the Illinois Farm Bureau, said his state’s meat packing companies had fewer workers because they feared being too close to other workers.
“The industry supports bacon and the other products they put together as cuts, so they slow down and don’t make the volume they had,” said Guebert.
“There is a concern for pork producers because they simply cannot turn their buildings on or off as you can for an assembly line,” he added. From the moment the sows give birth to slaughter, “It is a nine-month process that started nine months ago. Pigs continue to be born every day, which they keep to their full capacity. “
In the meantime, major food distributors, including U.S. Foods and Performance Food Group, are begging the Treasury Department to prioritize loan requests from their sector as companies transfer operations to retailers.
“This type of transition, even a temporary one, takes time and investment because we are adjusting our warehousing, logistics and purchasing processes to respond to a consumer-oriented market,” they wrote in a letter to l Trump administration.
A group of food workers’ associations has also appealed to congressional leaders for any future aid program to “include support for essential workers in American industry” through tax breaks or direct payments.
In the United States, an oversupply of food production is forcing certain sectors to take extreme measures and to demand additional creative solutions from the government.
“It is clear that we are going through a time of crisis,” said Gordon Speirs, owner of Shiloh Dairy in Brillion, Wis. “We lost 25 percent of our income just because of the market collapse. Now we are faced with the reality of having to empty the milk on top of that. ”
John Umhoefer, executive director of the Wisconsin Cheese Makers Association, said the restaurant industry accounts for half of all cheese sold in the United States, while only a third is sold in grocery stores. Without this critical market, milk producers need the government to “immediately start buying dairy products” and distribute them to pantries and school feeding programs, he said.
Westhoff of the University of Missouri said that declining restaurant meals will ultimately dampen demand for high-end meat products like steaks.
“Even though we have a short-term grocery store rush that has given us price hikes very temporarily, we don’t think it will last very long,” he said.
The radical change in the age of the pandemic is a seismic change for the food industry. In 2018, Americans spent more on food in full-service and fast food restaurants – about $ 678 billion – compared to the $ 627 billion spent on grocery stores and warehouse clubs, according to data from l ‘USDA. Spending on food outside the home is even higher when meals are counted at schools, colleges, sporting events and other places of entertainment.
Now, the National Restaurant Association predicts that the industry will lose $ 225 billion over the next few months, along with some 5-7 million jobs.
“Grocery stores are simply not set up to replenish the shelves to meet this type of demand,” said Joseph Glauber, senior researcher at the International Food Policy Research Institute.
For the most part, food analysts say consumers don’t have to worry about other countries that have export restrictions on food and agricultural products. Vietnam, the third largest rice exporter, has temporarily suspended grain exports. Russia, Ukraine and Kazakhstan, the major producers of wheat, have capped exports of this product.
“The signs are all disturbing on the foreign side, but if you look at all the measures taken, they don’t seem to have at least very big ramifications yet,” said Glauber, who was previously chief economist in the Department of Agriculture.
So far, the United States appears to have encountered fewer barriers to transporting food and agricultural products than other countries. Border controls across Europe, for example, scolded trucking and at one point cut traffic by up to 50 miles.
The European Union has tried to reduce congestion by opening so-called green lanes for trucks transporting agricultural products. US highway regulators have lifted driving hours for essentials, including “food for emergency store replenishment”.
Some governments have asked their citizens to help them pick fruit and vegetables and have considered designating special planes and buses to transport workers from eastern Europe to western farmland.