We have been analyzing what has happened in the previous couple of weeks, and want to share our thoughts. While I don’t have exact numbers, before Corona, approx. 60% of onions went food service and 40% went retail.
With single parents or with two parents, everyone generally was working. Cooking was not an option 7 days per week, so eating out and take outs was the majority, for a good percentage of meals.
With Corona, somewhere between 250 and 300 million Americans are cooking at least one meal and sometimes 2 or 3 meals per day – 7 days per week. Retail has instantly become the only real source of food. Take out food is available from some restaurants, but a lot of Americans are afraid their takeout might have Corona.
Most retail stores that offer Instacart and similar delivery services are overwhelmed. The delivery system can’t handle the action. Going to the grocery store for food is a scary process. People are wearing masks, gloves and are full of fear and want to go in and out.
In order to practice proper social distancing, stores only take so many people at a time. Long lines outside the stores are the new normal. With everything basically shut down and with spot shortages of everything at any given time, people prefer to shop once or twice a week at most, to avoid the fearful, time consuming and possibly dangerous adventure of going to the store.
People are home, therefore they are eating more. Michael has heard comment after comment from his kids, how they never realized how much their kids ate until they had to buy food and cook all their meals. His daughters, 39 and 41, never experienced the need to do all this cooking to feed their kids. This does not look like it is going to end anytime soon.
Best estimates are that, while President Trump would like to see People be able to get out and go to church by Easter Sunday – April 12, logic dictates that won’t be practical for the majority if not all of the country. With the onslaught of Retail buying of packaged onions at an all-time high in history: There may not be enough packing time to fill all retail orders at shipping point. Packing material is short because packers, both at shipping point and regionally, have sold unprecedented amount of consumer pack sized onions. The bag, carton, film, and parts for the baggers, etc industry is getting hammered for replacement orders and cannot handle the high volume of requests for instant delivery of replacement packaging and product. Packing machines have never ever been this busy and bulk onions are being replaced by 2 lb, 3 lb, 5 lb and 10 lb onion orders. This is causing a lot of packing equipment breakdown. Repackers are scrambling for parts for to keep their packing machines running. Foodservice is suffering with hardly any business. With restaurant business down 80-90%, they cease to be a factor because they use 50 lb units. Most consumers will not buy a 50 lb bag of onions. Some foodservice companies are trying to reinvent themselves to sell to the public, but they must sell packaged onions, further stressing the already stressed packing suppliers. The terminal markets are supplying chain stores shorts and local retail business, but have been overwhelmed with excess bulk product they can’t sell. There just isn’t much of a market for 50 lb bags of onions. Almost all that business has switched to smaller package consumption. Recap: A shortage of packing time. A shortage of packing material. Shipping point can’t handle all the demand for consumer pack onions because there has been an almost total switch from 50 lb onions to consumer size packed onions.