Sit back and enjoy our Friday recap of the world in food. Amid the cornucopia: the USDA sings a tired tune, brands like Bimbo skip stores, prices for cereal are probably fixed, delivery services are killing restaurants, Subway tuna has no tuna and micro-plastics are scary.
MACRO
- Markets fell at weeks end but no one noticed because everyone was watching the Game Stop drama.
- Vaccine distribution increasing but new COVID variants cause concern. NY and Chicago moved to 25% restaurant occupancy.
- A large think piece from the New York Times about the impact the Biden Administration will have on food. On the list: protecting food workers from COVID, hunger, helping small farmers, organic regulations.
RETAIL AND CONSUMER
- Meet the new USDA dietary guidelines. Same as the old USDA dietary guidelines. More or less.
- The retail space continues to disaggregate: brands both marketing and shipping direct to consumer. Bimbo begins an initiative with their snacks.
- Says here that food consumers are shifting to smaller sizes – have they considered we are running out of room from the stocking up we did earlier? They also find price sensitivity increasing but, if our experience is any indication, we stopped looking at pricing while we got used to apps to purchase groceries.
- WalMart announces plan to expand media and advertising offering – omni-channel – to offerings that include channels inside and outside it’s proprietary assets. This follows the leads of Google, Amazon, Apple, etc. as the giants try to tie up more revenue opportunities while adjusting to the ever expanding constraints on cookies. All of these efforts in the face of suppliers having many and new options of communicating and selling directly to consumers (see above).
- Are big investment groups causing higher cereal prices? Large institutional investors invest in all the major players in a category, forming a ‘stealth monopoly’. Temptation to engage in things like price collusion or force mergers is strong.
- COVID brought meal kit companies more opportunities and revenue but they haven’t yet figured out profitability. (Hello Fresh did have a good 3rd quarter.) Here Sunbasket is adding grocery delivery to their offering; maybe integrated meal planning – varying levels of execution meal to meal – is the next wave.
RESTAURANTS AND FOODSERVICE
- The restaurant revolt against delivery services is here.
- You’ve heard of dolphin-free tuna? How about tuna-free tuna? According to a lawsuit filed in California this week, Subway’s tuna had no traces of tuna. A while back, a court in Ireland ruled Subway’s bun didn’t meet the standards necessary to be called bread. Next you’ll be telling me that the foot-long sandwich isn’t 12 inches. (Ron Howard narrator voice: it isn’t).
- Will restaurants survive at all? They will certainly evolve. But as for permanence, the concept of restaurants is only a couple hundred years old. I would argue that the restaurant is as much entertainment as eating and has come to fill certain aspects of the public square in ways that make their presence in whatever form secure.
- There’s a restaurant in Montreal that is trying an honest approach on their menu. It is hilarious.
FOOD SUPPLY CHAIN
- Corn trade – and with demand comes higher prices – rebounding with Biden Administration. China importing the hell out of soybeans.
- “Half the Trucks are returning empty:” Brexit is causing chaos with British exports particularly in agriculture.
- AS we’ve been discussing, China has this seemingly over-the-top approach to testing for COVID on imported food shipments. Now the port at Dainan is over-whelmed.
- The US is used to getting produce from across the border. However it is increasingly coming form north of the border as the Canadian companies continue to invest in greenhouse production.
- Normally a bunch of rain is good for agriculture in California. But this weeks storms are uber-violent and the soil has lost stability due to last years wild fires.
- Move to no-till agriculture would reduce soil erosion by 70%. Although controlled-environment would reduce it to pretty much 100%
LAGNIAPPE
- The REAL origins of Buffalo Wings.
- Disturbingly large amounts of micro-plastics are taken up in plants. And these micro-plastics can contain cadmium, which can cause cancer.
- Like everybody, Molson Coors is moving into RTD, which stands for Ready to Drink. My response when somebody brings up Ready-to-Drink is: yes, please.
- The world’s largest democracy has issues like the world’s oldest democracy – farmers storm government buildings.
- No Mardi Gras this year so the good folks of NOLA have invented the house float.