Food Rotting in the Fields But Shortages in the Stores

Mish

Food banks are running out of food but farmers are letting it rot in the fields. What's going on.

Politico reports Tens of millions of pounds of American-grown produce is rotting in fields as food banks across the country scramble to meet a massive surge in demand.

Images of farmers destroying tomatoes, piling up squash, burying onions and dumping milk shocked many Americans who remain fearful of supply shortages. At the same time, people who recently lost their jobs lined up for miles outside some food banks, raising questions about why there has been no coordinated response at the federal level to get the surplus of perishable food to more people in need, even as commodity groups, state leaders and lawmakers repeatedly urged the Agriculture Department to step in.

Tom Vilsack, who served as agriculture secretary during the Obama administration, put it this way: “It’s not a lack of food, it’s that the food is in one place and the demand is somewhere else and they haven’t been able to connect the dots. You’ve got to galvanize people.

Coronavirus Forces Farmers to Destroy Their Crops

The Wall Street Journal reports Coronavirus Forces Farmers to Destroy Their Crops

As the coronavirus pandemic disrupts supply chains, American farmers are dumping milk, throwing out eggs and plowing under healthy crops. Produce suppliers are especially vulnerable to surpluses because fruits and vegetables are perishable and can’t be stored.

Lettuce producer Mark Borba, in Huron, Calif., said he has had to plow under 230 of 680 acres of recently harvested lettuce since the pandemic swept the country a month ago. He said demand fell off so sharply from restaurants, schools and other large customers that his crews had to unpack 9,000 cartons of lettuce from a warehouse where they had awaited shipment and dump them back in the fields to be plowed under.

“The demand [from the large customers] just went to zero,” said Mr. Borba, who manages 10,000 acres under his Borba Farms. “And not only did we lose restaurants and schools, but people were going to the grocery store buying nonperishable stuff to put in the pantry. They were not buying leafy greens.”

Pork and Beef Shortages 

On April 12 Reuters reported Smithfield shutting U.S. pork plant indefinitely, warns of meat shortages during pandemic.

Since then, things have gotten much worse. 

On April 23, the Wall Street Journal reported Grocers Hunt for Meat as Coronavirus Hobbles Beef and Pork Plants.

Covid-19 outbreaks among employees have closed about a dozen U.S. meatpacking facilities this month, including three Tyson Foods Inc. plants this week. Other plants have slowed production as workers stay home for various reasons.

Tyson, the biggest U.S. meat company by sales, on Thursday temporarily closed a Washington state beef plant, after closing two Midwestern pork plants on Wednesday that produce millions of pounds of meat, together slaughtering nearly 35,000 hogs daily. Smithfield Foods Inc., Cargill Inc., JBS USA Holdings Inc. and Hormel Foods Corp. have closed plants over the past month, leading to significant declines in overall U.S. meat production.

Meat companies are trucking poultry and livestock to be processed at other plants, and bringing in welders to install shields between processing-line work stations. On farms, some pigs now are being euthanized because slaughterhouses have closed, farmers said.

Meat companies are trucking poultry and livestock to be processed at other plants, and bringing in welders to install shields between processing-line work stations.

Six-Point Synopsis of What Going On

  1. The USDA normally buys food that can be stored for a long time. It cannot easily deal with Fresh fruits and vegetables and things that do not store easily.
  2. Grocery stores stores stock 1-2 pound packages. of cheese. A pizzeria might buy 50-pound containers. It is expensive to retool plants to package things differently for what is supposed to be a temporary disruption. 
  3. People eat vegetables more often when eating out than they do at home. There is a collapse in demand for many items. 
  4. With diminishing need for raw milk to produce cheese farmers are dumping it. The same is in play for many fruits and vegetables. Strawberries are rotting in the fields and farmers are plowing under beans.
  5. At the meat packing plants, the workers work very closely to each other. Covid-19 is spreading rampantly. Plants had to be closed.
  6. Store shortages are mainly meats, dried foods and canned foods. Price of beef has soared in the past week due to closure of processing plants. At times I have had a hard time finding canned tomato sauce. I see holes where boxes of au gratin potatoes should be.  People hoard items that store well.

Demand Shift and Supply Chains

It is easy to blame the USDA or Trump but the problem is quite a bit more complicated due to Covid-related demand shifts and supply chains.

One of my readers, Jdog1, summed up the above 6 points succinctly: 

"Farmers who sell to the restaurant industry do not have a direct supply line to the grocery stores, so their perishable goods go bad before they can find new customers and mechanisms to get their goods to market."

What to Do?

People want government to do something about this. But what? 

I see no sensible action and government never solves anything, anyway.

Mike "Mish" Shedlock

Comments (75)
No. 1-23
Jdog1
Jdog1

The real problem here is supply lines. Farmers who sell to the restaurant industry do not have a direct supply line to the grocery stores, so their perishable goods go bad before they can find new customers and mechanisms to get their goods to market.

Bam_Man
Bam_Man

I live in a semi-rural area of West-Central FL. Our local farmers markets and butchers have plenty of stock on hand. It is people in cities and densely populated suburbs who are experiencing the shortages. There is going to be a HUGE exodus from those places (most of which have sky-high property taxes, to boot) when the dust settles on this fiasco.

Herkie
Herkie

Commodity/farm prices dropped to the point in the great deprssion that farmeers burned their crops and plowed them into the ground rather than sell them because they lost money on every sale. Worse they slaughtered animal stock and buried them in vast trenches, even as so many had no money to buy food with and were begging for food (under the republican administration of Hoover).

SAKMAN
SAKMAN

LOL - You asked a question, my answer?

Crony capitalism - My understanding is that the potato famine had nothing to do with potatoe shortages and everything to do with hording and making money.

I have the food, pay up or starve. LOL!

Stan88
Stan88

Americans don't want tomatoes, squash and onions - they want twinkies, doritos and frosted flakes

Six000mileyear
Six000mileyear

With all the anti-gun laws, people won't be able to hunt for food. My grandfather was a cattle rancher in the Ozarks. His neighbors were dirt poor. Instead of begging for some of his cattle, they asked if they could hunt deer. My grandfather told them, "Go ahead, but don't shoot any of my cattle". He never asked anything in return for the deer.

Mish
Mish

Editor

Excellent comment by reader Jdog 1. I added his comment to the blog.

Sechel
Sechel

I find it interesting to hear you write that consumers eat more vegetables when dining out compared to eating at home. I say this eating a Kale , sockeye and avocado salad for dinner. Guess I'm an outlier. I should be eating a pizza I guess. I'll eat vegetarian dinners and fish dinners the whole week essentially and every meal contains a vegetable.

It's a packaging issue for food too. Restaurants and Fast food will buy eggs differently than consumers. The fast food eggs are not even in shell. Bacon sourced to restaurants is sold in slab not sliced and supermarkets stock hamburger , cheaper cuts and non-aged beef while steak houses aged porter house. The products are not fungible and the packaging and distribution quite different. It's simply not easy to redistribute products originally destined for restaurants to supermarkets.

In the supermarket I continue to see shortages of pasta but fresh fruits and vegetables are in abundance as is fish. So for me I'm not too impacted. I don't eat much meat at all. I'm a practicing pescatarian although occasionally i will consumer steak but weeks and months can space between beef consumption.

Some of this can definitely be blamed on the pork processors like Smithfield foods who clearly didn't take appropriate protective measures to ensure the safety of their workers but this is the difference in how a Goldman Sachs and a Bloomberg treats their workers vs a line item pork processors.

By the way, strawberries can be purchased for jam, or sold as frozen but the price points are different.

CzarChasm-Reigns
CzarChasm-Reigns

I would expect the federal government to fill the gap, and it appears there is an attempt to do so. Stats from that post, which are along the same lines:

"Feeding America predicts the country could see a 46% increase in Americans who struggle to get enough healthy food to eat on a daily basis, an additional 17.1 million people. They say they need an additional $1.4 billion in resources to accommodate the 30% increase in their overall operating costs."

Personally, I had switched to Walmart grocery delivery via a 3rd party prior to the pandemic, and found it to be great. But that system has been broken for a month now. You can stay up until midnight & schedule a one hour delivery window 2 days out, but no one can tell you for days after a no show, when you will actually get your groceries. Once it arrived a couple of days late. Once we waited a couple of days to find out the order was cancelled. The pickup system is under stress, but hanging in there. Ordering online at peak freak was slim pickins & 1/3 of items ordered, were cancelled during the picking process. Back to just a couple now.

Blurtman
Blurtman

This is the result of a terrible overreaction to keep elderly people with comorbidities from doing what is eventual anyway, especially folks who are dumped in nursing homes by families too inconvenienced to care for them.

Art Izagud
Art Izagud

The national guard is being deployed in some places to keep order at food banks. Why not have them transporting food there instead? Because a generation of authoritarians and ideologues is in charge.

NewUlm
NewUlm

The real problem is what government deems essential, if a government could understand the complexities of an economy than communism would be the most successful form of government.

The downstream impact of these actions (right, wrong or in between) will be with the economy for multiple years to come.

Greenmountain
Greenmountain

Turkey season begins this week in VT. Unfortunately most hunting occurs in the fall because you want the young a chance to grow. Stop complaining about non-existent laws against hunting. you want to get a turkey - start practicing now - there are a lot in Vt.

Webej
Webej

"People eat vegetables more often when eating out than they do at home. There is a collapse in demand for many items. "

That must be an American thing. I eat far more salad & vegetables at home than they ever serve in restaurants, let alone fast food.

Tim E
Tim E

Excellent comment - many won't get it. Thanks for saying it.

BenBernank
BenBernank

Exactly like in the Great Depression.

awc13
awc13

in a way, it is government intervention that has caused this (by forcing businesses to close and people to stay at home). more government intervention will not help

awc13
awc13

now virginia is saying they will be in lock down for 2 years. I am going to buy and store more canned/jar food items that will keep 1-3 years. the canned chunk chicken from costco has an expiration date 3 years out

palmer808
palmer808

Mish....
NEVER!
As in, "Never solves anything "
Sixty years born and raised American.
Solved the cleanest shirt in the dirty laundry pile....
For sixty years.
Mightiest MIC on earth..
How do I know, you ask?
No takers!
How did Google become Google?
United states of America internet prowess.
Microsoft?
United states government grants, loans, technology, research and development designed for our military, fashioned to the consumer want....
Tesla, government subsidies out the wah-zoo, we all want it to end in a ball of Elon flames..
But will it.
Kiss
Privatize profits
Socialize losses
Sweet dreams you pack of naive capitalists

joemal50
joemal50

I suggest use the National Guard to transport food from rural farms to the cities to be sold by Produce stands.

Sweetskp
Sweetskp

I would like to think one easy solution to this problem would be to let those that can, harvest those crops as well as prep for transport to the thinning food banks. That would help farmers not waste and the needy not go hungry and its not a handout because the needy will contribute as they are able. This group in the WH are as clueless as a box of rocks when it comes to running a government, it's not Socialism to have concern for your fellow man. Only a soulless person can look at other people go hungry and look away with no problem. One lengthy illness can deplete the largest nest egg because money can't buy health or happiness. This is a wake up call to everyone, if we don't reel in this mess of policy makers and this loose cannon wanna be effective President we will end up like Russia or worst the Jews during the holocaust and it won't matter the color of your skin "poor" will determine your fate... don't be naive; those people in DC, those elected officials do not care about America the Land of the Free, above average or average Americans. They are for the rich and big corporations that have purchased their souls and have attached puppet strings.


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