Because of COVID-19, 2020 is the ultimate anomaly. Millions of Americans are working from home or sequestered at home. The marketplace disruption caused by COVID-19 spells uncertainty for the year’s most anticipated food and beverage trends. That is a function of key factors: what employers can gain from more work from home and what employees want. A survey of chief financial officers noted they planned to shift 20 percent of their employees to remote work to save costs. An average of the two ranges suggests that 20 to 30 percent of workers could end up working from home a meaningful amount of time.
Cooking more at home
State of the Industry 2020
OverviewBeef (NCBA)
Beef (FQF)
Pork
Chicken
Turkey
Veal
Lamb
Seafood
Food Safety
Workforce
Sustainability
Packaging
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Fifty-four percent of Americans are cooking more than they were before the pandemic, and 35 percent say they enjoy cooking more now. Many changes have occurred in consumption patterns because of these anomalies. These changes in consumption patterns have positively affected retail sales and retail meat sales and negatively affected foodservice. During one week in March, U.S. grocery store sales spiked 77 percent over the previous year, while restaurant sales were off by 66 percent. McDonald’s, despite its great drive-through system, reported a 23.9 percent decline in second-quarter global sales. This year will be a disastrous year for foodservice, with industrial spending projected to be down 28.4 percent, compared with initial 2020. The sector will claw back with growth of 7.3 percent in calendar 2021, according to the International Foodservice Manufacturers Association (IFMA).
REFRIGERATED UNCOOKED MEATS (NO POULTRY):
TOP 5 RETAIL BRANDS
Brand | Dollar Sales | Dollar Sales % Chg YAgo | Unit Sales | Unit Sales % Chg YAgo |
Private Label | $4,161,239,400 | 17.2% | 594,102,649 | 8.6% |
No Brand Interstate Meat | $694,715,991 | 19.6% | 84,477,353 | 11.6% |
Laura's Lean Beef | $104,772,648 | 33.8% | 14,884,279 | 29.9% |
Hormel Always Tender | $101,023,042 | 15.4% | 14,423,098 | 5.4% |
Smithfield | $100,321,900 | 14.0% | 16,177,049 | 7.5% |
Total Refrigerated Uncooked Meats | $6,358,493,212 | 20.5% | 901,375,161 | 1 11.7% |
Source: IRI, a Chicago-based market research firm (@iriworldwide). Total US - Multi Outlet w/ C-Store (Grocery, Drug, Mass Market, Convenience, Military and Select Club & Dollar Retailers), latest 52 weeks ending Sept. 6, 2020. Note: Rankings of top brands are NOT totaled brands (e.g. all brand lines/extensions rolled up into a single figure), but rather individual brand lines.
Change in grocery shopping habits
Grocery shopping has turned into a speed exercise because of anxiety over contracting the virus. Seventy-two percent of consumers have lessened the frequency of their grocery shopping during COVID-19, while 56 percent of consumers feel anxious about forgetting to pick up or not being able to find specific foods when shopping in-store. A lack of the ability to visit the store for a missing ingredient can change a mealtime game plan. These trends give grocery stores and the brands that sell through them a chance to convert more shoppers to online grocery for home delivery or grocery pick-up.
FROZEN MEAT (NO POULTRY): TOP 5 RETAIL BRANDS
Brand | Dollar Sales | Dollar Sales % Chg YAgo | Unit Sales | Unit Sales % Chg YAgo |
Private Label | $920,900,177 | 22.0% | 97,233,352 | 19.5% |
Bubba Burger | $181,180,522 | 36.4% | 13,203,799 | 30.0% |
Cooked Perfect | $102,529,039 | 14.0% | 15,557,491 | 1.4% |
Steak Umm | $67,515,107 | 19.8% | 10,512,479 | 12.8% |
Philly Gourmet | $50,433,347 | 41.3% | 5,476,807 | 27.2% |
Total Frozen Meat (no poultry) | $2,043,073,409 | 22.5% | 245,757,441 | 14.8% |
Source: IRI, a Chicago-based market research fi rm (@iriworldwide). Total US - Multi Outlet w/ C-Store (Grocery, Drug, Mass Market, Convenience, Military and Select Club & Dollar Retailers), latest 52 weeks ending Sept. 6, 2020. Note: Rankings of top brands are NOT totaled brands (e.g. all brand lines/extensions rolled up into a single figure), but rather individual brand lines.
Plant closures
Major outbreaks causing plant closures and other issues have meat production sitting at approximately 95 percent of 2019, despite robust demand. Producers are having significant problems with employee outbreaks, and because of the state of emergency that President Trump declared, they have been allowed to stay open — but it still has been a struggle. The industry has added many partitions to separate employees from one another in a plant environment. Rendering companies like Darling reported a significant increase in earnings resulting from quality protein from depopulated hogs that could not be processed and were sent directly to rendering.
As consumers stock their fridges, freezers and shelves, sales for both meat and meat-alternative products have seen a significant lift. The global market for plant-based meat is estimated to be $3.56 billion in 2020 and is projected to grow at a rate of 17 percent between 2019 and 2021.
U.S. RED MEAT AND POULTRY FORECASTS
2016 | 2017 | 2018 | 2019 | 2020 | 2021 | |
Production (million lb.) | 97,614 | 100,169 | 102,435 | 105,266 | 106,296 | 107,348 |
Per capita disappearance (retail lb.)* | 214.7 | 217.3 | 219.8 | 224.3 | 224.1 | 223.9 |
Forecasts are in bold. * Per capita meat and egg disappearance data are calculated using the Resident Population Plus Armed Forces Overseas series from the Census Bureau of the Department of Commerce. All data as of Sept 17, 2020. Source: World Agricultural Supply and Demand Estimates and Supporting Materials. For further information, contact: Mildred M. Haley, mhaley@ers.usda.gov
Dinner for one
The number of single-person households continues to grow. The benefits of cooking dramatically differ if you’re cooking for one versus many. According to the U.S. Census, single-person households increased from 17 percent in 1969 to 28 percent in 2019. From 1984 to 2018, the number of annual marriages declined by 16 percent, to 2.1 million per year, while the U.S. population increased by 72 percent in that same time period. Birth rates in the U.S. fell in 2018 to 3.8 million births, which is a 32-year low since 1986.
Changes in family eating, snacking habits
The eating habits of more than half of families have changed in the time they’ve been staying at home. Seventy percent of consumers share that they snack and eat more frequently. People tend to eat more to cope with stress or boredom, and through the pandemic, people have clearly found an abundance of both on their hands. When it comes to delegating responsibility for meals, 17 percent divide and conquer meal responsibilities with spouses and partners more often. For 3 percent, these responsibilities have entirely reversed. The remaining 80 percent have kept the roles consistent and 67 percent have been forced to get creative with what’s left in their freezer and pantry between grocery orders or shopping. Fifty-seven percent of consumers have reorganized their pantries and food storage.
REFRIGERATED BREAKFAST SAUSAGE/HAM:
Top 5 Retail Brands
Brand | Dollar Sales | Dollar Sales % Chg YAgo | Unit Sales | Unit Sales % Chg YAgo |
Morningstar Farms | $275,776,112 | 20.6% | 61,276,586 | 18.1% |
Beyond Meat Beyond Burger | $77,627,851 | 77.4% | 14,063,287 | 84.5% |
Gardein | $75,979,476 | 34.7% | 17,035,508 | 34.5% |
Morningstar Farms Grillers | $59,907,927 | 22.9% | 13,568,596 | 20.8% |
Beyond Meat Beyond Sausage | $52,719,472 | 221.7% | 6,370,301 | 230.3% |
Total RFG/FZ Meat Substitutes | s $961,179,676 | 53.3% | 201,294,051 | 41.1% |
Source: IRI, a Chicago-based market research fi rm (@iriworldwide). Total US - Multi Outlet w/ C-Store (Grocery, Drug, Mass Market, Convenience, Military and Select Club & Dollar Retailers), latest 52 weeks ending Sept. 6, 2020. Note: Rankings of top brands are NOT totaled brands (e.g. all brand lines/extensions rolled up into a single figure), but rather individual brand lines.
Greater focus on health and immunity
The strong demand for probiotics indicates more consumers are potentially making gut health a priority as consumers look to immune-boosting and healthy foods to protect themselves from COVID-19. Forty-three percent eat more fruit, 42 percent eat more vegetables and 30 percent are eating more protein in the form of meat, poultry or fish. On the less healthy side, 47 percent are turning to more sweets, 24 percent have decreased their vegetable intake, 21 percent east less fruit and 19 percent are eating less protein. With more time in the morning, 39 percent eat a more filling or balanced breakfast — often considered the most important, and possibly most undervalued, the meal of the day.
Feed ingredients continue to be oversupplied. Petroleum prices remain depressed below normal levels because of the dramatic reduction in demand.
Food banks
If Feeding America were a food retailer, it would be the 13th largest food retailer in the country right now. With record unemployment, people want to be sensitive about how they are spending those dollars. But consumers are not cutting back on what they are cooking. They are cutting back on things other than food, but people anticipate that is coming.
The billion-dollar question is not “Will things go back to the way they were before?” The obvious answer is no. The real question is how similar will the new world order of the food and beverage marketplace be to pre-COVID-19 patterns. Restaurants have become highly creative in taking care of their customers during this crisis. Some of these new tactics will be adopted as a permanent measure.
Those who are bold and creative can grasp opportunities in front of them and prosper. NP