CLEVELAND, April 29, 2020 /PRNewswire/ -- The Freedonia Group has launched the COVID-19 Economic Impact Tracker to help keep businesses informed as the economic impact of the COVID-19 pandemic continues to evolve. Among the markets we are closely tracking are the food processing and foodservice industries, which are seeing some of the most significant impacts.
Monthly sales data from the US Census Bureau reported that unadjusted retail sales at food and beverage stores posted a 30% increase from February to March of 2020, and a 26% increase over comparable sales in March 2019. This reflects a few main factors related to government stay-at-home orders, including government-mandated closures of schools and restaurants, driving a significant percentage of consumer food spending from eating out to eating at home.
Expect April figures to remain above same-month 2019 patterns but likely not as high as in March 2020, which included a lot of panic buying and stockpiling that will have been reduced in April, when many stay-at-home orders had already taken hold.
Meat suppliers contend with pandemic-related plant closures
On Sunday April 12, Smithfield Foods announced its decision to close a major pork processing plant in Sioux Falls, South Dakota, to stem the local impact of an outbreak of COVID-19 infections among at least 238 of the facility's 3,700 employees. Other meat processors have closed plants for the same reason – including Cargill, JBS, and Tyson Foods – and more are likely to close as the virus continues to spread.
Already facing falling demand due to government-mandated restaurant closures, livestock farmers are now finding these limitations in the food processing market. This is likely to affect supplies of retail chains as well; for instance, the closed Smithfield pork processing plant represents up to 5% of US pork production.
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