Friday, September 23, 2022

"As Walmart Shelves Get Barer, Insiders Are Warning That Supplies Will Get Tighter In The Weeks Ahead"

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"As Walmart Shelves Get Barer, Insiders Are Warning 
That Supplies Will Get Tighter In The Weeks Ahead"
by Epic Economist

"If you have been to your local supermarket lately, you probably have noticed empty shelves where some of the most popular grocery staples should be. This year, a series of food retailers, including big names such as Walmart and Target, are experiencing shortages of a wide range of products as a result of supply chain disruptions, higher costs of fuel and fertilizers, and extreme weather events. Now, industry insiders are telling us that the outlook for agricultural production in the U.S. is extremely grim. No one really knows for sure when the supply of many of these everyday essentials will bulk back up. And while shortages persist, prices continue to climb higher – with some painful increases that range from 10 to over 40 percent just over the past 12 months.

American farmers and ranchers – who have done everything in their power to keep the nation’s supermarket shelves supplied over the past two years, are now on the edge of desperation. They are seeing their crops being destroyed by the ongoing drought, their livestock headcounts have shrunk by the millions, and they’re also dealing with some of the most expensive prices of critical materials and energy ever recorded. Much of the food that has been grown in the past year won’t ever make it to our food system, and this means, we’re about to see shelves get even barer at our local stores in the coming weeks and months.

In 2022, nearly three-quarters of US farmers saw a reduction in harvest yields due to the dry weather, with 37% saying that they were tilling over fields that won’t produce anything because of a lack of water, a 13% increase from last year. According to Farm Bureau data, one-third of orchard farmers nationwide, and 50% in California, said they were ripping up trees, an increase from 17% in 2021. Ranchers are also having to make some very tough decisions. A new report revealed that two-thirds of the country’s ranchers are selling off animals or birds, with average herd sizes dropping by 36%. The biggest herd declines are in Texas (collapsing 50%), New Mexico (43%), and Oregon (41%), a clear example of the wide geographic distribution of the distress.

Those working at the very root of the U.S. food supply chain can’t catch a breath. They’re also facing labor shortages, surging processing costs, and transportation delays. Meanwhile, food retailers are specifically warning that current conditions are likely to prevent the industry from supplying enough supplies to the general population. Egg Innovations CEO John Bruunquell recently alerted that an uptick in demand coinciding with labor, freight and vendor issues may soon hamper grocery supplies. Bruunquell noted that businesses are already operating at 100 percent capacity, but that still may not solve the problem. "If that trend continues it’s going to put us in a challenging situation with meeting the demand," he stressed.

On social media, a flood of posts on Facebook and Twitter expose that even the world’s biggest retailer isn’t immune to shortages and supply chain challenges. In a series of short videos, shoppers exposed empty meat and produce aisles at Walmart. Of course, empty shelves are being spotted in many other supermarkets across the U.S., but the fact that the largest and most well-resourced big-box retailer on the planet is having supply issues should be a wake-up call for all of us. That’s a very ominous sign for US consumers, the retail sector, and the broader US economy. At this point, we all want the supply chain crisis to be resolved, inflation to go back down, and life to return to the way that it used to be. Unfortunately, none of those things are going to happen. We must start bracing for a future where scarcity is the new normal. Everyone in the industry is telling us to prepare for the worst, so it would be unwise to ignore their alerts."

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