U.S. suppliers dealing with meat scarcity
COVID-19 outbreaks at nation’s plants hurting production
Hundreds of Wendy’s restaurants have run out of hamburgers. Kroger, the largest supermarket chain in the United States, is limiting the amount of ground beef and pork that customers can buy at some stores. And Costco, where shoppers typically buy in bulk, has placed a three-product cap on purchases of fresh beef, poultry and pork.
During the last month, dozens of meatpacking plants across the country have shut down because of coronavirus outbreaks, raising concerns about the country’s meat supply. Now, the effect of those disruptions is reaching customers at grocery stores like Wegmans and Hy-Vee and fastfood drive-thrus, where certain meat products are becoming harder to find.
On Monday, nearly one-fifth of Wendy’s restaurants — a total of 1,043 locations — were completely sold out of beef products, including burgers, according to analysis by the financial firm Stephens, which examined the online menu at every Wendy’s in the United States.
“It is widely known that beef suppliers across North America are currently facing production challenges,” a Wendy’s spokesman said in a statement Tuesday. “Some of our menu items may be temporarily limited at some restaurants in this current environment.”
On social media, customers posted photographs of “sold out” signs at Wendy’s drive-thrus and noted the irony of a hamburger shortage at a chain that popularized the slogan “where’s the beef ?”
Over the last few days, a series of grocery stores have announced limits on meat purchases. In addition to Costco and Kroger, Hy-Vee said on Tuesday that it would restrict customers to four packages of fresh beef, ground beef, pork and chicken.
Stores are also anticipating that certain products may become more difficult to find. A Wegmans spokeswoman, Laura Camera, said Tuesday that the chain “may not have every product cut or variety available for the next few weeks.”
The effect on the fast-food industry has been more uneven. McDonald’s said on Tuesday that it had not experienced any beef shortages. But Shake Shack executives warned this week that the price of beef had “significantly increased.”
“We do not, today, expect a supply issue,” the company’s chief executive, Randy Garutti, said during an earnings call on Monday. “However, costs have really jumped.”
Wendy’s reliance on fresh beef — a major selling point for the brand — may make it more vulnerable to shortages than some rivals.
“It impacts them more quickly, as opposed to some restaurants that have a little bit more frozen options on the menu,” said James Rutherford, an analyst at Stephens who wrote the report on Wendy’s.
The report also found geographic differences in how significantly Wendy’s was affected by the shortages. In some states, including New York, Connecticut, Ohio and Michigan, 30 percent or more of the chain’s restaurants were out of beef, whereas other states like Nevada and Arizona did not have any shortages.
Food industry executives have warned of looming supply issues since April, when outbreaks at some of the country’s largest meatpacking plants brought production to a halt.
After a Smithfield pork plant closed in Sioux Falls, S.D., the company’s chief executive, Kenneth M. Sullivan, said the country was “perilously close to the edge in terms of our meat supply.” And last week, the chairman of Tyson Foods took out fullpage ads in the New York Times and the Washington Post warning that “the supply chain is breaking.”
In a call with investors on Monday, Tyson executives said that more meatpacking plants were likely to shut down for cleaning as the virus continues to spread.
Tyson did not quantify how much meat production has declined. But the union that represents plant workers estimates that pork production has fallen by as much as 25 percent, with beef down 10 percent.
Still, grocery executives say the shortages are only temporary and that most meat remains available, even if certain products have become more scarce. In recent weeks, some meatpacking facilities have reopened, including the Smithfield pork plant in Sioux Falls.
When he arrived at a Wendy’s outside Minneapolis on Monday, Taylor Boyte, 30, noticed that several items on the menu were crossed out in marker. Then he ordered a burger.
“They were out of beef,” Boyte said. “I just kind of chuckled. Being in the middle of the pandemic, it’s pretty understandable. People aren’t prepared for what’s going on.”
But there was other food to eat. Boyte got lunch at Taco Bell instead.