Grocery store cart. Photo credit: Unsplash
“I was looking at the pasta section today, plenty of pasta out there … but red lentil pasta and chickpea pasta … people aren’t buying that even when there are no other options,” said Karl Schroeder, president of the Seattle division for Albertsons Companies.
The grocery store is just one end of the food chain that has been disrupted with levels of uncertainty that reaches farmers and consumers alike. And for many, uncertainty equals anxiety as people race to adapt.
Albertsons not only oversees its own brand name, but also Safeway, Carrs, and Haggen stores throughout Alaska, Washington, and Idaho. Schroeder has observed the effects of the pandemic on the food supply chain and customer behavior: Fewer trips to the store, but buying much more during those visits. Produce availability is generally strong, though managers have sometimes had to adapt to the up-and-down supply.
On top of that, restaurants have largely closed or slowed operations to a trickle, shutting off that heavily relied upon segment of the food supply chain.
Nationally, NPR reports that the disruption has prompted a 2.6% rise in food prices at the grocery store, which is the biggest spike since 1974. Pasta and rice are up 2.5%. Hamburger is up 4.8%. And cookies (oh my!) are up 5.1%.
And while red lentil and chickpea pasta has thus far remained on shelves, problems with farms today could mean problems on store shelves in the future.
More potatoes, more problems
Potato farmers are growing increasingly anxious about a massive oversupply, putting many in dire financial straits.
“It’s kind of ironic, we have this huge oversupply of potatoes right now … but if you were to walk into the grocery store there’s a good chance that the supply of, let’s say, frozen french fries, is pretty low. How can that be?” said Chris Voigt, executive director of Washington state potato commission.
“We have growers who have already planted and invested $2,000 per acre — that’s generally what it cost to plant potatoes … now, the processors called on March 27 and said, ‘Stop planting. If you’re not done planting, you’re done today. Just stop…’” he said.
“Who it is going to hurt the most is the smaller guys …. it will financially cripple them, they will go bankrupt.”
Washington’s food supply chain has a grocery store side and a food service side. Food service includes restaurants and school cafeterias.
About 90% of Washington’s potatoes are grown for the food service industry to make french fries, hash browns, tater tots and more. These are products more commonly found on menus instead of inside freezers.
“So when you shut down (food service), all of a sudden you have eliminated 90% of our market — it’s a tremendous hit,” Voigt said.
Potato processors cannot easily convert from food service to retail (grocery stores). They are set up to fill large, blank bags of potato products that are sent away in shipments. There’s no labeling required at grocery stores, which sell much smaller portioned packages.
That means much of last year’s harvest has no place to go — and that’s a lot of potatoes. And if they can’t use up last year’s crop, then there is no need to buy the next.
Washington farmers will produce 10 billion pounds of potatoes annually. Much of a harvest goes into storage to be used throughout the year, and sold to food service. But this year, it is estimated that at least 1 billion pounds of potatoes will be left over before the next harvest begins after the Fourth of July.
“We’re backed up,” Voigt said. “…we have all these potatoes in storage that are piling up that the processors aren’t taking fast enough. And yet, our new crop is going to be harvested starting right after the Fourth of July …. That is really a concern. What do you do with all those extra potatoes?”
“It used to be that we could pretty much set our watches to potato demand,” he said. “We knew how much potatoes the U.S. was going to eat. We knew that before Easter there was going to be a big rush — or Christmas, Thanksgiving. Growers could plan for that, processors could plan for that. Now, we have totally changed consumer behavior. Nobody knows how much to plant anymore, or what demand is.”
Support family farmers
According to the Washington State Farm Bureau, 96% of Washington’s farms are family run. But Voigt pointed out that these operations are still expensive.
He laid out this scenario as an example:
Family farms have to get loans every year to finance their crops. They may borrow $2 million — perhaps mortgaging property — to get that loan. They could get a 5% return on a harvest after they pay off the loan.
“If they oversupply the market just by 5%, that can cut their income in half,” he said.
If the farmer was planning on making $100,000 for themselves that year, they won’t. And they still have to pay off a $2 million loan.
“You’re done,” Voigt said. “That just ate up 10 years of profit. You’re going to lose your house, you’re going to lose your farm. That’s the situation we are facing now with a lot of uncertainty.”
Washington’s potato industry alone contributes $7.4 billion to the economy, and produces 36,000 jobs, according to the potato commission.
Bailey Peters with the Washington Farm Bureau said that while times may be tough for farmers, she’s confident that food is still going to be grown.
“Farmers are planners, so they are already planning for next year’s season. And if this season goes poorly and they have to turn crops under, there could potentially not be a 2021 season for some of the farmers. That’s a terrifying reality,” she said.
“Unfortunately, we are seeing that with potatoes. People are on the brink of financially collapsing.”
And while ordering more take-out could be one response to get money flowing through food service again, Peters said that people could help most by focusing their purchases at local farmers.
“So some farms are doing on-farm stands,” she said. “You can order online, and you can come pickup from a farm stand. Some of the larger farms can do that.”
The Farm Fresh Washington website has resources to locate such farms.
“I think that it’s always important to buy local, so if you are wanting to Uber Eats food or order through takeout, I would just challenge everyone to look more into that business or restaurant — are they actually using Washington-grown food?” Peters said.
She urges those who want to support farmers to buy food from them directly.
That’s the best way we can support them right now, is to buy Washington-grown goods. Whether that’s from the grocery store, or a restaurant, or that’s directly from the farm itself.”
Posted By: KUOW
Posted On: May 15, 2020