Coronavirus Pandemic, Supply Chain Problems Cause Prices Of Grocery Store Staples To Skyrocket

Published May 13, 2020 at 11:20 AM CDT

A shopper looks at a shelf of vegetables. (Romeo Gacad/AFP/Getty Images)

If it feels like you've been paying more for your groceries during the coronavirus pandemic, then you're right.

The U.S. Bureau of Labor Statistics reports that April saw the sharpest increase in grocery store prices in nearly 50 years. The pandemic has been affecting the supply chain in the U.S., which causes prices to rise on staples such as eggs, rice, flour and meat.

Transporting goods from point A to point B has slowed for multiple reasons, including workers getting sick from the virus and truckers struggling to get products to stores fast enough.

"The process of being able to get it from the farm to processing to your store shelves, that’s the issue that’s come up," says Wall Street Journal commodities reporter Kirk Maltais.

As consumers feel the real effects of the coronavirus crisis on their pocketbooks, companies are predicting supply chain problems may have a lingering effect. For example, Maltais says the agricultural lender CoBank recently reported they expect retail pork and beef prices to be up 20% in July compared to 2019 prices.

Companies have "weeks now of shipments that they didn’t make, trips that they didn’t take, the stocking shelves that they didn’t do that they have to make up for," he says. "It’s something where we can try and work through the kinks, but we’re still going to be feeling this."

Eggs

If you're able to get your hands on them, many places are seeing the cost of a dozen eggs rise to more than $3. There have been price gouging lawsuits filed in California and Texas over the price of eggs.

Maltais: "The problem with eggs and really anything in the supply chain, it’s not the availability of the raw material — eggs, meats, grains, whatever have you — all of that is abundantly available in the United States. ... Before this, egg prices were at record lows, but because it’s not able to get to the grocery store, they’ve had to get rid of eggs on the supply end. It’s just transporting it from point A to point B is the problem."

Flour

There was a nearly 3% increase in prices for cereal and bakery products last month. The Washington Post reports it was the steepest single-month increase on record for these products.

Maltais: "It’s something that globally, especially when COVID-19 first hit, there was a run on grocery stores for flour, wheat flour, particularly, and that drove the prices of wheat higher for some time. It’s something where even now there’s difficulty finding that specialty flour because the supply chains for grocery stores haven’t adjusted to carrying enough inventory to cover for the increased consumer demand."

Pork

Livestock producers say the supply chain is so off they’re now euthanizing hogs.

Maltais: "In the beginning of the year, there was a record level of both hogs and cattle produced in the United States. So when COVID-19 hit, food service, you know, your restaurants, your catering service, what have you, they were forced to shut down. You just have this issue where you then have this backlog of hogs that are on farms. They’re on feed. It’s tough to stop them from growing. I mean, the average hog that’s on feed being prepared for slaughter grows at a rate of 2 pounds per day. And there is a certain weight level that these plants, whichever plants are open at this point, can actually take a hog. The normal hog that’s slaughtered is roughly around 250 pounds, much more than that. And you know, these facilities can’t take them. They can’t handle a hog that’s over 330 pounds or so. So what happens? I mean, these farmers are just forced into a situation where they can’t sell their product. These hogs are getting bigger. And what do they do? They’ve made the unfortunate choice that they have to, in some cases, euthanize them."

Rice

A global record in rice production has sparked a "supply chain concern" of getting rice on the shelves due to higher consumer demand, he says.

Maltais: "The [U.S. Department of Agriculture said on Tuesday] that global consumption of rice is expected to hit a record large. That’s right, around 500 million metric tons. But that said, I mean, the U.S. production of rice is actually up 17% for this marketing year. So a lot of countries were adjusting to this increased demand for rice by producing more rice. So what you have is just the same thing that’s happened in the other types of food products where it’s just an ability of the product to get to the store shelves."

Lynn Menegon produced this interview and edited it for broadcast with Peter O’Dowd. Serena McMahon adapted it for the web.

This article was originally published on WBUR.org.