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Canned Meat Booms As COVID-Recession Crushes Consumers

Courtesy of ZeroHedge View original post here.

As recession and pandemic overwhelm the Western world, the consumer is in rough shape and has been forced to reduce costs to weather the economic storm. This means some have had to give up Chipotle burritos and Shake Shack burgers for canned meat. 

Significant consumer shifts are underway in the Western world, and other places as a global downturn will persist through year-end, without forming a V-shaped recovery. Bloomberg notes the consumption of canned beef is exploding: U.S. sales surged more than 70% in the 15 weeks ended June 13. A similar story is playing out in parts of Europe and Asia. 

"At first, people were loading up on pantry staples with a long shelf life during lockdown conditions. Then, shortages of some fresh meat supplies, especially in the U.S., also helped to drive sales. Now, the economic downturn is underpinning demand.

"There's the obvious factor of income here. With millions thrown out of work in the last few months, consumers are looking for a way to cut back on grocery bills, and they're trading in fresh meat for canned varieties. But there's also something deeper going on — a return to comfort food and nostalgia in troubled times," Bloomberg says. 

Some meat processors of canned meat are reporting they've been caught off guard with several months of massive demand. 

Kasper Lenbroch, CEO of Tulip brand at Danish Crown Group, Europe's top meat processor, said: 

"Even I thought it could be difficult to increase our sales of canned meat to more than what we expected," said Lenbroch. "It's not very often when you're in food that you can see traditional products like these grow as much as they have done right now."

He said sales of Tulip Pork Luncheon Meat in 120 different global markets are expected to rise 25% this year, adding that sales will be significantly higher in the U.K., Germany, Greece, Japan, and Singapore. 

Marfrig Global Foods SA, an international beef processing company based in Brazil, said sales of its canned meat products in the U.S. are expected to reach 3,500 metric tons this year – that figure was nearly double the tonnage seen in 2019.

Marcelo Secco, CEO of Marfrig Global Foods S.A., said canned meat products are popular among U.S. consumers considering the meteoric rise in wholesale beef prices due to COVID-19-related closures of U.S. meat processing plants. 

Since the pandemic, Hormel Food Corp.'s Spam has seen rapid growth in canned meat products in the US – though it serves as an ominous sign about the economy: 

"The last time Spam saw a similar pattern in interest was back to when the brand started during the Great Depression. The economic situation wasn't great — that was carried into World War II," said Brian Lillis, Hormel's senior brand manager for Spam. "What we saw over the last few months is really people all over the country purchasing the product."

The rise of spam and other canned meat products is a direct result of the depressing economic situation around the world – there will be no V-shaped economic recovery this year


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