Chicken breast is the highest I’ve ever seen. A lot of our prices are the highest that I’ve seen it.General Manager Tessa Strength, Roll’s Meat Market, on rising prices, due in part to labor shortages.
- The poultry market has been impacted by several factors over the last year: COVID cases impacted crews at factories, lower production and suddenly higher demand.
- Labor shortages (not having the hands to help produce the chicken) is impacting supply, according to this report in Pennsylvania.
Why It Matters: Chicken is just one product impacted as the economy comes back to full capacity as regulations drop, and the American public returns to more normal activity.
Big Picture: There's a name for this economic phenomena, the bullwhip effect – this explains what happens when the economy slows down and comes roaring back in quick succession – the supply chain is greatly impacted by the sudden slowdown, and shutting down production, and a sudden acceleration, and scrambling to ramp up production.
Excerpt: The food sector is seeing a version of what supply-chain experts call the bullwhip effect, where companies that have pulled back their operations seek to rapidly scale up on signs of improving demand, leaving suppliers scrambling to keep up. …
In the past few weeks, menu mainstays like frankfurters and french fries have been in short supply, said Suzanne Rajczi, chief executive of Hudson, N.Y.-based Ginsberg’s Foods Inc., which serves independent restaurant operators in the Hudson Valley and upstate New York.
Her sales team is steering customers to products the company does have in stock—a 6 oz. chicken breast instead of a 4 oz. breast, for example. “We’re trying to buy as much high-volume inventory as we think we can sell,” Ms. Rajczi said, “but we’re still beholden to those manufacturers that are hampered by their production capacity.”
Broader supply-chain upheaval is also hitting food distributors, delaying shipments of overseas products like tuna and olives and holding up delivery of corrugated cardboard and other packaging materials, she said. “We can make salad dressing but we can’t make the bottles to sell the salad dressing.”
by Jenna Lee,