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Mademoiselle Desserts Group, the France-based frozen bakery supplier, is planning to spend EUR30m (US$35.5m) over the next 18 months to increase production capacity.
The group said it is putting the money in now so that it is ready to meet an expected increase in demand when the Covid-19 crisis is over.
UK food and beverage M&A down markedly – research
The latest research from London-based advisory firm Oghma Partners has revealed that food and beverage M&A activity in the UK has receded significantly during the Covid period.
It said that year-to date – up to the end of the second tertial – deal volumes were down by more than 50% on a year-on-year basis and Oghma is expecting it will be down by around 40% to 50% for the full year.
However, it said it is “anecdotally seeing a pick-up in activity due to the long-time lines” but this is unlikely to lead to year on year improvement until Q2 2021.
For the period between May and August 2020, total deal volume (15 transactions) remained significantly down when compared with the same period in 2019 (37 transactions).
“The 59.5% decline in deal volume comes as no great surprise as we continue to witness challenging conditions for M&A within the UK food and beverage market,” Oghma said.
Overall deal value for T2 2020 was estimated at c.GBP350m (US$453.2m), which is considerably down when compared to the same period in 2019 where total deal value was estimated at cGBP1.2bn.
Overhill Farms, the US frozen-foods supplier, faces a fine in California for allegedly failing to protect staff from Covid-19.
Belgium-based fruit and veg supplier Greenyard has raised its full-year profit guidance in a trading update today (17 September) after seeing a third consecutive quarter of sales growth.
US grocery suppliers may largely have a got a Covid boost but, with the health and economic impacts of the virus still being felt, we asked four for their thoughts on trading. This piece is also free-to-read.
China bans imports from OK Foods chicken plant in US
China has banned imports from a meat plant in the US owned by OK Foods.
It is the second US company to be affected by such a ban which is the result of China trying to stop the spread of the Covid-19 virus. Imports from a Tyson Foods plant in Springdale, Arkansas, were blocked in June.
News agency Reuters, quoting the USA Poultry & Egg Export Council, said imports from the OK Foods plant at Fort Smith, Arkansas, have been put on China’s blacklist following an outbreak of coronavirus amongst the workforce there.
OK Foods is owned by Mexico’s Industrias Bachoco.
In a widely distributed quote, USA Poultry & Egg Export Council president Jim Sumner said: “We don’t think that either one of these two [OK Foods and Tyson] are justified, especially considering the fact that the virus cannot be transmitted in poultry meat.”
OK Foods did not immediately respond to requests for a comment, US media outlets reported.
US grocery suppliers may largely have been boosted by Covid-19 but, with the virus still causing uncertainty, and with concerns over the economy, we asked a group of manufacturers for their thoughts on trading and the outlook for their businesses.
Brazilian meat giant JBS is set to be fined US$15,615 in the US for Covid-19-related health and safety failings at its plant in Greeley, Colorado.
A report in the UK claims almost a quarter of pubs remained closed at the end of August due to the pandemic, with the plight worse for restaurants, just as new social-distancing measures come into force today (14 September).
Nomad Foods sees Covid outbreak at UK plant
Nomad Foods has seen an outbreak of Covid-19 amongst employees at one of its UK plants.
The cases have been confirmed at a plant run by its Yorkshire pudding and roast potatoes business Aunt Bessie’s in Hull in eastern England, it has been widely reported.
Those reports say that the number of workers affected has not been revealed but Aunt Bessie’s confirmed a “small number” of its employees had been sent into isolation after receiving the results.
Hull Live suggests a first employee told bosses that they were feeling unwell last Thursday (10 September), the day before a second person began showing symptoms.
The factory is understood to employ around 250 people, producing 900 million Yorkshire puddings annually.
In a statement sent to just-food, Nomad said: “Currently, our Aunt Bessie’s factory has a small number of coronavirus cases, but PHE [Public Health England] has repeatedly complimented us on our social distancing measures and our proactive approach to ensuring that our colleagues are safe and well.”
It added: “If a factory worker contracts the virus, we would clean the area where the person was working, confirm that social distancing has been applied and apply our own track and trace procedure to identify co-workers who also need to go into isolation. Any employees who isolate due to having symptoms, or having contracted the virus, will continue receiving full pay.”
As offices closed across the world, employees took to home-working, often with more flexible hours. On our analysis pages, Lucy Britner explores the challenges and opportunities for major packaged-food companies as new working habits look set to stay.
South African poultry processor Astral Foods has issued a profit warning due to costs associated with Covid-19 and depressed chicken pricing.
Smithfield Foods, the US meat firm owned by China’s WH Group, is facing a fine from America’s health and safety authority amid claims the processor “failed to protect employees” from coronavirus.
The Australia division of JBS, the meat packer headquartered in Brazil, is laying off 600 workers at a plant in Queensland due to market conditions related to coronavirus.
Cadbury and Oreo owner Mondelez International is putting more money behind advertising during the second half of 2020 in a bid to keep the new consumers attracted to its brands in a year shaped by Covid-19.
2 Sisters Food Group, the UK-based poultry products business, is aiming to recruit an additional 100 employees at a UK processing facility.
General Mills highlights Covid-linked gains
US food major General Mills has highlighted the gains it has made during recent weeks.
In an update on the Old El Paso owner’s recent business performance ahead of its participation at the 2020 Barclays Global Consumer Staples Conference today (9 September), the company said it “continues to compete effectively and win in the current environment, including year-to-date market share gains in the US in retail and away-from-home channels”. General Mills’ current financial year started on 1 June.
It added: “The combination of higher at-home food demand and General Mills’ top-tier supply chain, sales, and marketing execution has led to significant increases in household penetration for the company’s brands, including Cheerios, Pillsbury, Old El Paso, Progresso, Yoplait, Betty Crocker, and more.
“In the past six months, General Mills brands gained more household penetration than the leading branded competitor in eight of the company’s top ten US categories.”
General Mills said it continues to expect the largest factor impacting its fiscal 2021 performance will be the relative balance of at-home versus away-from-home consumer food demand.
It said retail inventory levels, which fell sharply in the early stages of the pandemic, saw modest replenishment in the first quarter of fiscal 2021 and it anticipates retail inventory levels will largely normalise by the end of fiscal 2021 as supply and demand equalise across its product platforms.
Outside the US, General Mills said it is “gaining market share year-to-date in each of its largest international markets including Canada, France, the UK, China and Brazil”.
Foster Farms reopens California poultry plant
Foster Farms has reopened a poultry plant in California after it was temporarily closed at the start of September due to 100s of coronavirus cases and a number of deaths.
The facility in the city of Livingston, Merced County, reopened today (8 September) following approval from the local health department. It shut on 1 September when Foster Farms said 358 workers at the site were infected with the virus, while eight employees had died.
It was a US public holiday yesterday for Labour Day.
Foster Farms said in a statement: “Through Labor Day, Foster Farms has conducted more than 4,800 Covid-19 tests of the Livingston Complex workforce. Results of the recent testing indicate a Covid-19 prevalence of less than 1% positive. The few employees that did test positive have been advised to self-isolate and will receive all appropriate medical leave benefits.”
Bakkavor first-half profits plunge 65%
Bakkavor, a significant player in the UK private-label market that has been hit by coronavirus at a number of its plants, has seen more than a 60% drop in first-half profits.
Profit before tax fell 65% to GBP6.8m (US$8.9m) in the six months through 27 June, based on revenues of GBP880.5m, which were down 4.6%, the company announced this morning.
On a like-for-like basis, revenues dropped 5.2% to GBP852.4m, while the same measure in the UK market declined 4.5% to GBP754m. Adjusted operating profits were 32.3% lower than a year earlier at GBP28.7m.
Bakkavor said: “It is encouraging that the steady recovery in trading seen across the business in June has been maintained into the second half of the year.
“The macro-economic uncertainty caused by Covid-19, combined with limited clarity as to the terms and implications of the UK’s exit from the EU, means that we have to be cautious as we look ahead to the rest of this year and into 2021. However, our performance in the first half of the year has proven our ability to withstand major operational challenges and gives us confidence in the quality of our business model and strength of our customer partnerships.”
Norwegian seafood business Mowi is partly blaming Covid-19 for a decision to close a French plant.
UK food industry survey reveals confidence at all-time low
UK food manufacturers’ confidence is at a record low according to a new industry survey.
Industry body the Food and Drink Federation (FDF) and bank Santander quizzed food and drink manufacturers and found that confidence reached a record low of -65.2% in Q2 with Covid-19 concerns to the fore
The report delves into the impacts Covid-19 has had on a sector which has faced a variety of challenges from the closure of the hospitality and out-of-home sectors to rising costs and a fall in exports.
The FDF has identified seven steps for recovery designed to restart all areas of industry, as part of its work through the Food and Drink Sector Council. These include protecting the UK’s supply chain “integrity” and competitive position and accelerating plans to increase UK exports.
FDF chief executive Ian Wright said: “As the dust begins to settle, we can now see how the pandemic has had a seriously damaging impact on 2020’s overseas sales of UK food and drink.”
He added: “As businesses turn toward economic recovery, ensuring a quick return to growth will be essential to support resilience in our industry.”
Campbell expects “elevated” demand to continue
The US soup, sauces and snacks major, one of companies to have benefited from the way Covid-19 has reshaped consumer demand for food, has given the market a flavour of how it sees the next couple of months panning out.
Alongside reporting its full-year financial results (net sales up 7%, EBIT 13% higher), Campbell provided a forecast for its sales in its current first quarter, which started on 3 August.
The Prego sauces, Cape Cod snacks and Campbell’s soup owner forecasts its first-quarter net sales will rise by 5-7%, contributing to an estimated 6-9% rise in “adjusted” EBIT and a 13-18% increase in “adjusted” earnings per share.
“The company expects that demand for its products will remain elevated in the near term,” Campbell said.
In the fourth quarter of Campbell’s financial year just past, the group’s net sales increased 18% to $2.11bn.
On an organic basis, which excluded the impact from an additional week in the quarter and the impact from Campbell’s sale of its European crisps business, net sales increased 12%, with the company saying the result reflected “a continued increase in demand as at-home food consumption remained elevated”.
Private-label trade fair cancelled
US trade body the Private Label Manufacturers Association (PLMA) has cancelled a trade show set to take place in Amsterdam in December.
The World of Private Label show, set for 2 and 3 December in the Dutch capital, had already been rescheduled due to Covid-19.
PLMA said it would “soon” announce a new online trade show and B2B video networking event “to provide an alternative” to the scrapped show.
Peggy Davies, PLMA’s president, said: “We understand the disappointment that our members and others may feel at the news that the ongoing coronavirus pandemic has once again upended our plans to hold an in-person international trade show in Amsterdam. Therefore, we are committed to moving forward with a virtual event that will provide the worldwide private label industry with valuable sales and marketing solutions when these are most needed.”
UK’s Premier Foods sees Covid outbreak at cake facility
UK-based Premier Foods has seen an outbreak of Covid-19 amongst its employees at a Mr Kipling cake plant in the English Midlands.
In a statement sent to just-food, the company confirmed the news but did not say how many if its workers at the Stoke-on-Trent facility had contracted the virus.
It said: “Over the last week, we have seen a very small number of colleagues test positive for Covid-19 at our Stoke factory, reflective of an increase in cases in the wider Stoke-on-Trent/Newcastle Under Lyme area. As a result, we have introduced further protective measures on site, in addition to our already stringent hygiene and safety procedures.
“We have been in contact with our local health protection team and are confident that we have taken all the necessary steps to protect our teams. We are monitoring the situation closely and will continue to keep local authorities updated.”
The affected employees are now self-isolating and, as a precautionary measure, all fellow workers that came into contact with those who have tested positive have also been sent home to self-isolate.
Premier believes the transmission occurred in the local community, rather than within the factory.
Covid-19 is still presenting challenges to the industry and just-food spoke to a number of packaged-food manufacturers operating in the UK for their latest views on trading.
Covid-19 has prompted manufacturers and their retail customers to step up reviews of product ranges and SKU counts. With the virus still in circulation and with an economic crisis potentially on the horizon, audits will continue to be necessary. Simon Creasey weighs up what questions executives should be asking as manufacturers try to tailor their product line-ups to the volatile trading environment.
US poultry processor Foster Farms is to temporarily shut down a California chicken plant after a coronavirus outbreak infected 358 workers and killed eight.
2 Sisters’ Coupar Angus facility reopens
2 Sisters Food Group has reopened its Coupar Angus poultry processing site in South Lanarkshire, Scotland, which was closed temporarily in August after a number of employees tested positive for coronavirus.
The site, which paused production on 17 August amid wider community clusters in nearby Perth and Kinross, reopened yesterday (31 August).
“Working closely with the incident management team, NHS Tayside and the local authority, we have been working hard during the temporary closure to supplement our existing Covid-19 control measures to keep all colleagues safe,” 2 Sisters said in a statement.
“Whilst it is important to ensure our measures on site are robust and working, we believe it is also critically important for our people to understand their obligations away from the factory in the local community, which our initial analysis suggests has played a significant role in the transmission of the virus.”
The company said all employees will receive training and “best practice guides on issues ranging from transport arrangements, conduct in the community, to keeping Covid-safe in a shared household”.
It added: “As one of the largest employers in the area, we are more than aware of our responsibility in the community to ensure we act with care to ensure everyone’s health, safety and wellbeing.”
Two meat plants owned by Irish firm ABP Food report Covid-19 cases
Irish meat firm ABP Food Group has had to curtail production at its Cahir plant in County Tipperary after 22 workers tested positive for coronavirus.
An ABP spokesperson said in a statement: “ABP has been notified of 22 positive Covid-19 cases at its Cahir processing facility following the screening of 460 staff. In line with Covid-19 protocols, all close contacts of those impacted are currently self-isolating.
“As a precaution, the site has been operating at a limited capacity since the first positive test on August 14th.”
ABP also said two workers at its factory in Clones, Co. Monaghan, have also contracted the virus but the facility remains open.
Banham Poultry plant in Norfolk hit by outbreak
Banham Poultry, the UK business bought out of administration two years ago, has reportedly partially closed its facility in Norfolk amid an outbreak of coronavirus.
The BBC said 75 workers at the plant in Attleborough have tested positive for Covid-19 after tests were carried out on the 347 staff following seven initial infections.
Banham was acquired in 2018 by Chesterfield Poultry, which is now trading as Iqbal Poultry. In seeking a statement, Iqbal Poultry directed just-food to call the Banham site where calls went unanswered.
The BBC quoted the UK’s director of public health, Dr. Louise Smith, as saying the cases at the Suffolk plant are “now being regarded as a significant national outbreak”.
Obesity more than doubles the risk of ending up hospital with Covid-19 and increases the chances of death by nearly 50% according the results of a global study published today (26 August).
The research, commissioned by the World Bank, finds people with obesity – with a BMI of over 30 – are at greater risk of severe illness and death from the novel coronavirus.
US manufacturer Hormel Foods expects another quarter of Covid-related declines in its foodservice business even as the hospitality sector starts to reopen.
Tiger Brands, the South Africa-based food group, has forecast the company’s underlying earnings could fall by as much as a third in its current financial year.
Only slight growth in new online grocery users in US during Covid era – report
Research from the US has revealed that the number of new users buying groceries online has increased only slightly in the country during the Covid-19 era.
The finding has prompted Tabs Analytics, the company behind the research, to suggest there is a need for new e-commerce strategies to be introduced.
“Given the focus on online shopping as the nation navigated stay-at-home orders and quarantines during the Covid-19 crisis, we expected online grocery to see a massive upswing this year. But, in reality, that was not the case,” it said.
Dr. Kurt Jetta, executive chairman and founder of TABS Analytics, said: “Since e-commerce grocery has not succeeded in expanding the pool of buyers at a time when demand is expected to be greatest, it has become even clearer that this channel will never have the scale necessary to be profitable with the current business model. New, creative approaches are needed to address pricing and streamline the supply chain.”
The company’s Annual Food and Beverage Consumables Study found online grocery transactions increased 15% year-over-year, as existing buyers made more frequent purchases.
The study showed Walmart was one of the beneficiaries of the shift to online, as it overtook Amazon in share of transactions for the first time.
The study also revealed that consumer packaged goods categories now lead the consumer sector thanks to significant increases in purchase frequency and average pricing. The majority of the 15 food and beverage “consumables” categories that TABS Analytics tracks saw meaningful gains.
UK’s cheap food could fuel Covid-19 spread – WHO envoy
The World Health Organization has said demand for cheap food in the UK could by fuelling the spread of coronavirus in factories.
David Nabarro, a WHO special envoy on Covid-19, said cramped conditions in manufacturing plants and in low-paid workers’ homes may have driven up infection rates amid consumers’ desire for cheaply produced food, according to a report in The Guardian.
Nabarro, who is a professor at University College London’s Institute for Global Health, raised the issue of low pay, which may mean employees exposed to the virus feel pressured to keep working.
“It may well be that in keeping production costs down, we end up with a situation where the people who work in food processing are under very, very tough working conditions and are paid relatively small amounts of money compared with other roles,” The Guardian quoted the health expert as saying.
“So one could argue that this is not so much structural issues in society as a consequence of the perpetual pressure to get quality of food up and prices down. And so a part of this may require thinking carefully about how much to pay for particular kinds of food.”
Working and living conditions for food factory staff could create a perfect storm for the spread of the coronavirus, according to Nabarro. “If people are living in very high-occupancy, cramped conditions and they’re sharing transport, that obviously is another way in which transmission is likely,” he said.
He added: “The hypothesis that I have developed is that, in these cold plants where work is very intense, there are quite a lot of factors that come together that make infection with the virus more likely.”
The newspaper’s own analysis suggests reported outbreaks of the virus are increasing in frequency, and in some cases are spreading to the wider community. It found at least 1,454 cases linked to food factories across England, Scotland and Wales.
2 Sisters expects to reopen Coupar Angus plant on 31 August
UK poultry processor 2 Sisters Food Group expects to reopen its Coupar Angus plant in Scotland at the end of the month.
Four employees at the facility in South Lanarkshire were confirmed as having tested positive for coronavirus on 16 August, prompting 2 Sisters to temporarily suspend operations at the site amid wider community clusters in nearby Perth and Kinross.
While a spokesperson today (24 August) did not confirm media reports that the number of infections at the plant has since risen, the person said in a statement “our existing measures will be refined and reviewed yet again before we reopen our facility on 31 August”. The factory employs 1,000 people.
The spokesperson added: “We continue to work extremely closely with the Incident Management Team, associated agencies and the Scottish government. We wrote to all colleagues on Thursday (20 August) explaining that wages would be paid as normal yesterday (Friday). We are still in dialogue with the Union and Government officials about next week’s payment, but expect an update early next week.”
Danish Crown re-opens Ringsted site
Denmark-based meat processor Danish Crown has resumed production at a factory closed earlier this month after an outbreak of Covid-19.
The factory in Ringsted, 40 miles west of Copenhagen, has re-opened.
Danish Crown has put in place more regular testing of staff, with all employees at the factory to be examined twice this coming week and then once a week “until further notice”.
Tests will be carried out on staff at two other sluaghterhouses, in Horsens and in Blans, this week.
“We have worked for a long period to create an opportunity to test our employees at our Danish factories. Now it has succeeded in collaboration with the regions and a private player to start with two slaughterhouses, and then the plan is to expand it to the remaining factories,” Per Laursen, the production director for Danish Crown’s pork business, said.
In May, Danish Crown halted operation at its Skærbæk slaughterhouse for a week after an outbreak of Covid-19 among staff at one of the site’s customers, Westcrown.
RCL Foods, the major South African manufacturer, has announced another profit warning ahead of the planned publication of its annual results next week.
UK’s Cranswick to close Covid-hit plant
UK meat processor Cranswick is to close one of its plants temporarily after an outbreak of Covid-10 amongst its workers.
Its meat plant at Ballymena, County Antrim, Northern Ireland, which processes pigs, will shut for a deep clean and further testing of staff.
The province’s health minister Robin Swann said 35 cases had been identified at the plant which employs 500 workers.
The plant will close on Saturday (22 August).
The UK’s BBC broadcaster quoted a spokesperson from London-listed Cranswick as saying: “There has been a recent increase in the number of confirmed Covid-19 cases in Ballymena and the wider region and this has been acknowledged as a community issue.
“As a result of this, we can confirm that a number of colleagues at our Ballymena site have tested positive for Covid-19.”
The BBC reported that Cranswick would normally process in excess of 10,000 pigs a week at its Ballymena plant.
Greencore has opted to close its factory in the town of Northampton in the English Midlands, a week after the Ireland-headquartered convenience foods manufacturer reported hundreds of coronavirus cases at the plant.
UK ambient food group Symington’s has launched a direct-to-consumer (D2C) platform, it has revealed, citing changed buying patterns during the Covid-19 outbreak as the reason.
Just still considering IPO, despite Covid-19 climate
US plant-based egg maker Just has said that it is still considering taking the business public.
The Just Egg maker said that, despite the uncertain economic situation created by the Covid-19 pandemic, it is still keen to pursue its IPO plans.
Speaking to news agency Reuters, the San Francisco-based company’s founder and CEO Josh Tetrick said it aims to turn an operating profit before the end of next year and then will consider an initial public offering.
He said that when the pandemic began spreading he thought it would delay any plans for the company to go public but housebound customers increased purchases.
“It makes it more likely we’ll go public sooner,” he told the news agency. “The target to hit operating profitability is sometime before the end of 2021.
“Once we hit operating profitability, then I’ll really begin considering an IPO with my team and with my board and with some of our major shareholders.”
Maple Leaf Foods temporarily suspends pork exports to China
Canadian meatpacker Maple Leaf Foods has revealed that it has temporarily suspended pork export to China.
It said it has done so on a voluntary basis due to recent protocols adopted by the Chinese government for Canadian processors which requires any plant reporting a Covid-19 positive case suspend exports to China temporarily.
Michael McCain, president and CEO, said: “We respect China’s new import protocols for Canadian products and are working cooperatively with Canadian and Chinese authorities to resume exports quickly.”
In April, Maple Leaf revealed that a small number of employees had test positive for the virus including two at its Brampton poultry plant.
In an update, the company said the Brampton plant is operating safely, and revealed “public health experts have said on numerous occasions that there is no evidence of workplace transmission occurring at the plant”.
Maple Leaf said it has been impacted by short-term increases in absenteeism but believes this is a “short-term situation and not a material financial event, given the diversity of the company’s markets”.
Orior, the Switzerland-based fresh meats and pasta business, has postponed the presentation of its 2025 strategy due to Covid-19-linked uncertainty.
Employees at Arla UK site test positive for Covid-19
Nine workers at an Arla Foods site in the UK have tested positive for coronavirus.
The Danish dairy giant said it is testing all employees at the facility in Settle, North Yorkshire, in northern England as a result.
It is continuing to operate the plant – which predominantly produces UHT milk – until the results of those tests are known.
A spokesperson for the company told just-food: “With the UK lockdown further easing it is expected that confirmed cases will arise, but taking early precautionary steps will help us in our efforts to contain this.
“The site has reported nine confirmed cases from employees and contractors in the last week, and whilst this is relatively low, given the close knit community at Settle, the contractors that have been visiting the site for essential work and the short time frame in which the cases have been confirmed, we have decided to implement full site testing for our colleagues and all contractors. This decision has been made with the support of the local authority and Public Health England.”
Bakkavor employees at desserts factory test positive
UK private-label major Bakkavor has seen more than 70 employees at a desserts facility in England test positive for the Covid-19 virus.
Pladis coy on report of Covid infections
Snacking firm Pladis, which owns the McVitie’s biscuit brand, has declined to confirm if its factory in the English county of Leicestershire has suffered another bout of coronavirus infections.
A media report had suggested an undisclosed number of shift workers at the facility in the village of South Wigston had tested positive for the virus following a number of cases at the same site earlier in the summer.
The city of Leicester was the first to be placed in a regional lockdown by the UK government in June after a flair up of cases, but authorities are believed to be now considering easing restrictions.
When asked by just-food to confirm the report and the number of infections at the site, a spokesperson for Pladis said, “we don’t have any further comment on this matter”.
However, Pladis did provide a statement, which read: “The safety and wellbeing of our employees remains our number one priority. We have been actively engaging with local health authorities who are confident that our site is taking every measure to ensure robust hygiene and social distancing measures are in place. We will continue to work closely with local authorities and follow all guidance laid out by the Government.”
The statement outlined measures the company has taken since March, including plastic barriers and social distancing; staggering work start times; the placement of sanitisers, enhanced cleaning procedures and weekend closures for deep cleaning; reduced production lines; face coverings; and pop-up canteens.
“All [workers] are instructed not to enter the site if they have any symptoms,” while “employees who are self-isolating receive full pay to ensure they feel no pressure to be at the site while unwell”, the statement read.
Hong Kong bans imports from Brazil’s Aurora over Covid concerns
Reports from Hong Kong have confirmed that the territory has banned imports from Brazilian chicken and pork processor Aurora over Covid-19 concerns.
Last week Aurora was identified by Chinese authorities as the origin of chicken products with alleged traces of coronavirus.
Now Hong Kong had blocked imports from the company’s chicken plant in Xaxim, Santa Catarina state, over linked concerns.
News agency Reuters, quoting a statement from labour prosecutors in Santa Catarina. reported that the ban comes on the same day the company agreed to test 11,000 workers for coronavirus, starting on 21 August, at four of its plants.
Reuters quoted the Brazilian meat lobby organisation ABPA as saying that there is no evidence coronavirus is transmitted by food.
But it confirmed Aurora has not been formally notified of the Hong Kong decision.
2 Sisters site in South Lanarkshire suspends operations after four Covid-19 cases
UK poultry business 2 Sisters Food Group has closed its plant in South Lanarkshire, Scotland, after four employees tested positive for coronavirus.
2 Sisters said the cases at the Coupar Angus facility were confirmed yesterday (16 August) amid wider community clusters in nearby Perth and Kinross, and has therefore temporarily suspended operations and paused production at the factory today. The site employs 1,000 people.
“We suspect they were all community transmissions, rather than the source being the factory,” a company spokesperson confirmed, adding that the first of the four infections was a manager at the plant who is suspected of contracting the virus from a close relative not employed at the plant.
The spokesperson for the Coupar Angus facility said in a statement: “Following the confirmation on August 16th of four positive Covid-19 cases at our site in Coupar Angus, we have decided to temporarily suspend operations and pause production on August 17th, which we believe is the responsible action to take.
“Our priority remains the safety and well-being of all colleagues, and we will be reviewing the situation closely in partnership with the relevant regional and national Scottish Covid-19 taskforces before we restart production.”
Homeworking has changed breakfast habits and continues to do so as Covid restrictions ease – but analysts at GlobalData argue consumers still want convenience even if they aren’t commuting.
The recent changes in consumer behaviour around meal times, and breakfast time in particular, are creating new opportunities for brands to increase market share with targeted products.
China finds coronavirus in frozen food imports
Authorities in two Chinese cities have found traces of the Covid-19 virus in frozen food imports.
Reuters, quoting local Chinese authorities, reported a sample taken from the surface of frozen chicken wings imported into the southern city of Shenzhen from Brazil, as well as samples of outer packaging of frozen Ecuadorian prawns sold in the north western city of Xian, have tested positive for the virus.
The news agency stressed that The World Health Organization has downplayed the risk of the virus entering the food chain.
Reuters said Shenzhen authorities identified the chicken as originating from a plant owned by Brazilian poultry and pork exporter Aurora.
It added Aurora said it had not been formally notified by the Chinese authorities of the alleged contamination while Brazil’s agriculture ministry said it was seeking clarification from Chinese authorities.
The news agency said the health commission of Shaanxi province, where Xian city is located, revealed authorities were testing people and the surrounding environment connected to the contaminated prawn products, which were sold in a local market.
Meanwhile, seven Argentine meat processing plants are temporarily not exporting to China because they have registered cases of Covid-19 among their employees, Reuters reported, quoting a source from the Argentine agricultural health agency Senasa.
Staff at a Fyffes UK warehouse to be tested for Covid-19
Nearly 200 UK-based members of staff at banana supplier Fyffes are to be tested for coronavirus after an outbreak among ten workers.
All staff at The Ireland-based company’s distribution centre in Coventry, in the English West Midlands, will be tested as a “precaution”, the city council said.
The BBC quoted a spokesperson at Fyffes saying: “The safety of all our workers is our number one priority and a number of actions to tackle this outbreak have been agreed and are currently being implemented.”
UK bakery group Addo reports Covid-19 cases
Pork pie and sausage roll maker Addo Food Group has disclosed positive cases of Covid-19 at a factory in the UK.
Addo said six staff at its Riverside bakery in Nottingham have the virus, which the company underlined “represents around 1% of the workforce at the bakery”.
A spokesperson added: “The health, safety and wellbeing of our workforce is our number one priority – with that in mind, we continue to refer colleagues for testing as required and have an immediate and clear plan we are following. Our Riverside bakery continues to operate normally, and we are communicating with Public Health England.”
Yesterday, it emerged almost 300 employees at a UK factory further south in Northampton, run by private-label giant, had tested positive for the novel coronavirus.
Private-label giant Greencore has seen an outbreak of Covid-19 among employees at one of its manufacturing plants in the UK.
The sandwich, sushi and sauces maker has reported almost 300 staff from its site in Northampton are infected with the novel coronavirus.
UK pubs, restaurants see sales halve post-lockdown
Figures have emerged in the UK giving a flavour of sales at the country’s pubs and restaurants in the first month since the formal re-opening of the sector.
Data collected by foodservice analysts CGA, property advisers The Coffer Group and accountancy organisation RSM showed the UK’s managed pub, restaurant and bar groups saw July sales down 50.4% on the same month last year.
Outlets in London fared worse, the researchers said. London trading was down 58.3% in July, with outside the M25 48.5% lower.
While pub groups collectively saw sales fall 44.7% over the month, restaurant groups in the cohort were down 59.8% and bars 63.3%.
“The figures are a reflection of the fact that reopening of sites has been gradual, and not all by any means are back in business, plus those that are open are in general trading at well below normal levels,” said Karl Chessell, director of CGA, said. “They also paint a mixed picture, with pubs tending to open up more strongly than restaurants, and London which was hit earliest still struggling to gain traction.”
According to the data, 76% of the group-owned sites trading in February were open again by the end of July. However, while 94% of managed pubs had reopened, 62% of bars and only 36% of group-operated restaurants were back in business, the analysts said.
Ireland’s Carroll Cuisine receives Covid-19 testing boost
Carroll Cuisine, which suspended operations at its plant in central Ireland earlier this week, has said Covid-19 tests on more than 200 of its staff have come back negative.
The meats and ready-meals supplier said 212 employees based at its Tullamore facility were tested by Ireland’s Health Service Executive.
Carroll Cuisine, majority-owned by private-equity firm The Carlyle Group, said its first employee to test positive for the novel coronavirus was on 31 July. Tests carried out by the company led to a total of nine staff out of 330 being shown to have the infection. The HSE agency then carried out the tests on 212 of the employees at the Tullamore plant.
“We therefore carried out two major testing programmes in one week. The remaining workforce of Carroll’s are not based at our Tullamore facility, or have not attended the facility since colleagues began working from home, resulting in no requirement for testing. Only employees who have tested negative will be allowed back to our Tullamore facility,” the company said in a statement.
The company is in talks with the HSE to establish when and how the Tullamore site can re-open. Carroll Cuisine said “a small number of essential maintenance workers are on-site as they are required to maintain the facility”.
It added: “Less than 3% of our workforce have tested positive for the virus and are self-isolating. Due to the small number of cases and contact-tracing being carried out, this allowed our factory to continue operating with the staff members who had all tested negative.”
Smithfield Foods reveals Q2 loss as Covid costs kick in
US meat giant Smithfield Foods has revealed it made an underlying operating loss of US$72m in its second quarter as the company was forced to spend $350m on measures to tackle the Covid-19 pandemic.
Smithfield, owned by China’s WH Group, is the largest US pork producer.
The company said the first half of 2020 was “a tale of two tapes”: pre-pandemic and pandemic. Prior to the onset of Covid-19 in the US, Smithfield said it had “delivered record results” in the first quarter of 2020, which were “190% higher than 2019”, although the company did not provide details on those numbers.
However, the impact of the pandemic weighed heavily on Smithfield’s second quarter (which ran to 28 June), leading the company to report an adjusted operating loss of $72m.
Smithfield said it incurred both direct and indirect incremental expenses related to Covid-19 during the second quarter. This included $195m in people-related costs, $125m in facility-related costs, and $30 million in community-related costs.
CEO Kenneth Sullivan said: “Going forward, we expect performance to rebound in the fall, as our Covid-19-related costs, some of which were one-time or short-term in nature, are declining.”
McCain Foods, the Canada-based potato-products group, has stepped in to try to support UK farmers, hit in recent years by volatile weather and now, due to Covid-19, uncertain demand.
As lockdowns ease, there are signs consumer demand for local food – which grew during the height of the pandemic – is sticking around, according to GlobalData Consumer.
Brazil’s BRF ‘registers 1,138 Covid-19 cases at single meat plant’
A report from new agency Reuters has revealed one of Brazilian meat giant BRF’s plants accounted for around 29% of Covid-19 cases at slaughterhouses in Brazil’s Parana state.
Quoting recently published data from Parana health authorities, it said BRF’s Toledo unit had 1,138 confirmed Covid-19 cases out of 3,979 Covid-19 cases at all the state’s slaughterhouses up until 24 July.
In response to Reuters, BRF said “there are no employees who tested positive for Covid-19 currently working at its Toledo and [nearby] Carambei units”.
Carambei and Toledo are operating normally, it said.
Aryzta revenue still down but baker points to progress
The Swiss-Irish bakery group, the subject of investor pressure and takeover interest, said its trading “continues to improve in line with expectations”, with revenues down by around a fifth.
Aryzta said in the month to 25 July the company’s revenues were down 18% on an organic basis. The company said its revenues were 23% lower in June, were 36% down in May and had fallen 49% year-on-year in April.
In Europe, Aryzta’s “monthly revenue evolution is now tracking” at around a 20% decline. The group said sales to its retail and quick-service restaurant customers “gradually improving” but revenues to other foodservice customers are “”still significantly down” amid restrictions on trade due to Covid-19,
Aryzta is seeing a similar picture in North America as some US states and cities reinstate restrictions. In that region, the company’s monthly revenue is down by around 15%.
The company, which is in the middle of its own strategic review, is due to hold a shareholders’ meeting called by agitating investors on 16 September to shake up the group’s board.
In April, Aryzta hired France-based investment bank Rothschild & Co. to review strategic options for the business, which has been struggling financially of late, particularly in North America, one of its two key markets along with Europe. The company raised EUR800m (US$939.4m today) in 2018 to bolster its capital base and has sold off a number of non-strategic assets to pay down its huge debt pile.
Cobas Asset Management and Veraison Capital, Aryzta’s two largest shareholders, have recently called for a further EUR600m in asset disposals.
Last month, Aryzta said it has received “unsolicited interest” in the business from unnamed third parties.
Bloomberg reported last month that Canada-based manufacturer and retailer George Weston was looking at whether to bid for Aryzta. Citing unnamed sources, the outlet said private-equity houses including Apollo Global Management and Cerberus Capital Management were also eyeing the situation.
Bakkavor to up testing at UK plant
The private-label supplier has seen cases of Covid-19 rise at one of its factories in England and will this week test all staff at the site.
All 1,600 employees at Bakkavor’s facility in Newark will be tested. The company is also testing its 90 agency staff at the plant.
On Friday, Bakkavor said infections among employees at the site had risen from 20 to 39.
Last week, Bakkavor confirmed it will be closing another facility in the English east Midlands. It blamed coronavirus and lost business at the start of the year for its proposal to consolidate work across four factories at the site.
Thai Union Group has decided to close one of its domestic factories, with the seafood major citing Covid-19 as a factor.
Denmark-based meat giant Danish Crown has announced it is closing its domestic slaughterhouse in Ringsted for a week after a Covid-19 outbreak amongst employees there.
Brazilian meat giant JBS in domestic hiring drive
JBS, the Brazil-based meat behemoth, is looking to take on more than 5,000 staff in its domestic market.
The company said it was looking to hire 5,200 employees across its beef, pork and poultry operations, spanning 16 states in Brazil.
In a statement, JBS said the new workers were being appointed to “modernise the lines and assist in production”.
Canada-based manufacturer Premium Brands Holdings is once again on the lookout for acquisition targets after temporarily suspending activity in May as a result of the uncertainty surrounding the coronavirus pandemic.
“Our acquisition pipeline remains especially robust and we expect to execute a number of transactions during the second half of the year,” Premium Brands Holdings CEO George Paleologou said.
“Covid-19 has motivated many more successful food entrepreneurs to reach out to join our unique ecosystem. We’re delighted and honoured to be able to offer them ownership solutions that preserve their operational independence while providing them access to our extensive resources and best-in-class services.”
Samworth Brothers, one of the UK’s largest suppliers of food-to-go products, has picked up the Urban Eat sandwich business from Adelie Foods, the now defunct business that called in the administrators earlier this year, citing the impact of Covid-19.
Ireland-based meat group O’Brien Fine Foods has stopped processing operations at a factory where dozens of staff have tested positive for Covid-19.
The Mexican state of Oaxaca has passed a law banning the sale of high-calorie ‘junk food’ and sugary soft drinks to minors.
Mexico has been fighting a battle against obesity, in children and adults, for some time and many people are partly blaming the state of the nation’s health for the toll the Covid-19 virus has taken on the population. Mexico now has the third-highest death toll in the world from the coronavirus, after the US and Brazil, with close to 50,000 people having lost their lives so far.
Birds Eye owner Nomad Foods has upped its forecasts on key sales and profitability metrics for 2020 as the company benefited from Covid-19-fuelled demand for frozen food.
Beyond Meat has expressed an ambition to “under-price animal protein” across categories after the launch of a value pack of burgers contributed to the US group’s sales growth in the second quarter.
The US-based meat-free group has sought to narrow the price gap between its product and conventional meat by offering what CFO Mark Nelson has called “more aggressive pricing and promotional programmes amid temporary dislocations in the animal-protein market” during the pandemic.
TreeHouse Foods lifts earnings forecast
The US private-label manufacturer today upped its forecast for underlying earnings per share after a better-than-expected second quarter.
TreeHouse raised its guidance for 2020 “adjusted earnings from continuing operations” to $2.55 to $2.75 per diluted share, up from a previous forecast of $2.40 to $2.65.
The company also said it now expects its 2020 revenue to be “at the upper end” of its guidance of $4.1bn to $4.4bn.
“We are encouraged by both the strength of our operations during this period of elevated demand and the commitment of our employees to supporting our healthy workplace protocols and processes,” CEO Steve Oakland said. “The work we performed related to our restructuring and reorganisation activities has enabled us to flourish during this uncertain time. Our outlook for the balance of the year assumes revenue will remain strong and takes into account higher costs to implement and maintain heightened Covid-19 safety measures. While macro uncertainty remains in the second half of the year, we feel comfortable in raising our full-year adjusted EPS guidance range.”
TreeHouse’s sales rose 3.7% on an organic basis as demand for foods to eat at home “outpaced” lower demand in the away-from-home channels, the company said. On a reported basis, TreeHouse’s second-quarter net sales were $1.04bn, versus $1.03bn a year earlier. First-half net sales stood at $2.13bn, against $2.09bn in the corresponding period of 2019.
The company booked a net loss of $1.5m in the second quarter, compared to a net loss of $171.8m in the second quarter last year. TreeHouse made a first-half net loss of $32.7m, against a net loss of $198.7m the previous year.
One third of US restaurants ‘face permanent closure this year’
A report from Bloomberg suggests that as many as one in three US restaurants may close permanently this year as a result of the economic impact of Covid-19.
The news agency, quoting research from restaurant consultancy Aaron Allen & Associates, says up to 231,000 of the nation’s roughly 660,000 eateries will likely shut down before the end of December.
In addition, Aaron Allen & Associates calculates that more than 8,000 restaurants in the US have already been directly affected by an employee with coronavirus.
Customer safety concerns would seem to be playing a large part in restaurants’ woes.
Covid-19 cases rose in tandem with customers entering re-opened restaurants, according to data provided to Bloomberg by Zenreach, but after reports of rising cases emerged, walk-in traffic turned down.
Bloomberg points out that the restaurant industry accounts for nearly 4% of U.S. gross domestic product and employed about 8% of America’s labour force before the pandemic.
YouGov global poll finds majority of people expect a recession
In a survey conducted by YouGov, a UK-based market research and analytics firm, most people around the world expect a recession over the next 12 months.
YouGov polled 27,000 people across 26 “economies”, with more than 50% of people in 16 of those places anticipating a depression or recession. For the rest of the 26, opinions ranged from 49-24%.
Mexico tops the list of the most concerned with 75% of people expecting such a scenario, followed by Hong Kong, France, Spain and the UK, where opinions ranged from 65-75%.
Vietnam is at the bottom of the list, preceded by China, the UAE, Saudi Arabia and Norway. Vietnam scored 24% of people expecting a recession, with China registering a result of 30%, the UAE and Saudi Arabia both 33%, and Norway 41%.
However, in Vietnam and China, more than 50% of people expect their economies to remain stable. In the US, 47% see a recession, while in Germany the figure is 57%.
Direct-to-consumer (D2C) has gained in prominence during the Covid-19 pandemic, with noticeable interest among a raft of packaged food manufacturers.
Relative to the recent flurry of activity in setting up direct-to-consumer services, Mars was ahead of the curve somewhat last year when the owner of the M&Ms confectionery brand acquired a majority stake in Germany’s Foodspring, a manufacturer of sports nutrition and health-and-wellness products.
D2C has become a channel a growing number of senior executives in the food industry expect to stay relevant beyond the pandemic, including Jean-Christophe Flatin, the president of innovation, science and technology at Mars, who spoke to just-food’s Simon Harvey about the US giant’s work with Foodspring and the impact Covid-19 has had on the wider industry’s interest in D2C.
UK private-label major Bakkavor has confirmed that it will be closing a facility in the English east Midlands following consultation with employees and trade unions.
Some 500 people are impacted by the decision.
The company, which supplies fresh food to the country’s largest grocers, said in June that it was considering the future of a salad facility in Spalding, Lincolnshire.
It blamed coronavirus and lost business at the start of the year for its proposal to consolidate work across four factories at the site.
New Zealand seafood business Sanford plans to close its fish processing facility in the coastal city of Tauranga partly as a result of the coronavirus pandemic.
Finnebrogue boss calls for regular Covid testing for food workers
The founder and chairman of UK meat and plant-based food manufacturer Finnebrogue Artisan is calling for regular Covid testing for workers in the industry in Northern Ireland, where it is based.
Denis Lynn, chairman of Finnebrogue Artisan, was quoted in The Irish News newspaper as saying a lack of regular testing represented a “failure to provide the coronavirus defence our fantastic food heroes deserve”.
The quote is from a letter he has written to Robin Swann, Northern Ireland’s Minister for Health, asking for a testing programme for food production workers in England to be replicated in the province.
The Naked Bacon producer employs 850 people at its base in Downpatrick.
It said it has introduced a comprehensive Covid action plan as part of an investment in excess of GBP1m (US$1.31m) to keep staff safe.
The company provides protective masks, has introduced daily pre-shift health-screening, installed perspex dividers on production lines and enforced social distancing with marshals on factory floors.
In his letter to Swann, Lynn wrote: “Food production staff have stepped up, performed an essential national service and deserve all of our gratitude.
“But more than just warm words, they deserve to be defended from the virus – and it is our duty to do everything we possibly can to do just that.
“Regular testing for key food production workers will be the key to spotting outbreaks early and stopping them spreading.”
New Zealand government reveals package of food initiatives
The New Zealand government has said it will fund healthy food initiatives to help food producers recover from Covid-19 and to “connect Kiwis with affordable, safe and wholesome food”.
Announcing the scheme, Agriculture Minister Damien O’Connor said: “The global pandemic has disrupted food supply chains and food retailers, making it difficult for some New Zealanders to access to affordable and healthy food and risking significant food waste.”
The Government has already set aside NZD14.9m (US$9.9m) over two years to redirect food that would otherwise be wasted to those in need.
It is also meeting the cost of processing and distributing surplus pork meat to families in need to help resolve an oversupply of New Zealand pork.
The Government has also provided NZD$32m for funding foodbanks and food rescue.
Amongst new initiatives, which will receive initial funding of up to NZD100,000 each for a ten-week development and trial period, are an online marketplace for food producers to list surplus product, a produce box-based supply channel, capable of providing a selection of produce to vulnerable households impacted by Covid-19, an online marketplace platform focused on supporting the smaller in-shore fishing fleet by connecting fishers directly with local consumers and an online marketplace which uses a algorithm to connect consumers to local producers and a delivery service.
Tyson Foods is preparing for a drawn-out pandemic by adjusting its manufacturing capacity to cater to the increased demand from retail amid the pressure on out-of-home sales, which is expected to continue to weigh on volumes even as it starts to recover.
French veg giant Bonduelle sees sales wilt
Bonduelle, the France-based, international supplier of canned and frozen veg, has reported a slide in quarterly sales during the three months to the end of June.
In the period to 30 June, Bonduelle’s fiscal fourth quarter, the company booked a 6.3% fall in revenue to EUR651.4m, which amounted to a decline of 6% on a like-for-like basis.
Bonduelle pointed to the “abrupt shutdown” of its foodservice customers in the spring, as well as “a drop in store traffic”, which the company said affected “mostly the frozen and fresh food” products.
Sales of its canned products “progressed strongly” during the quarter but could not offset the pressure elsewhere in its portfolio.
Bonduelle, which is scheduled to report its full annual financial results on 28 September, said its full-year sales rose 2.8% to EUR2.85bn, or by 1.4% on a like-for-like basis.
Inghams confirms Victoria restrictions to affect plants
Australia-based poultry business Inghams has said its two meat processing plants in the state of Victoria face a six-week period of restricted operations as local government officials try to dampen down Covid-19 in the region.
Curbs on meat production are included in new “stage four” lockdown measures covering the state announced by Victoria State Premier Daniel Andrews yesterday (3 August).
Those restrictions will impact operations at Inghams’ two meat processing facilities at Somerville and Thomastown.
However, the restrictions do not apply to other assets and facilities in the company’s integrated supply chain such as its hatcheries, farms, feed mill or logistics operations.
Inghams’ Thomastown further processing plant only reopened yesterday after a two-week shutdown because of an outbreak of Covid-19 amongst its employees there.
In a stock-exchange filing today, Inghams said: “We are currently advised that the restrictions will apply a 33% reduction in the workforce at these plants from peak production staffing levels at any one time, as well as some additional safety initiatives.
“Whilst we await the formal Victorian government directive to provide further certainty on the detail of the restrictions, Ingham’s management are working through the implications for the reduced workforce at both our Victorian processing sites, and looking to minimise the impact of the restrictions through use of other processing sites in the Ingham’s network and inventory that we have on hand.”
CEO Jim Leighton said: “The measures announced in Victoria will require our team to manage more complexity, but we are unwavering in our objectives of ensuring the health and safety of our people, preventing the spread of Covid-19 in our facilities and in Victoria, ensuring the highest standards of animal welfare, and servicing our customers and consumers in Australia and New Zealand.”
Keytone Dairy launches D2C service
Keytone Dairy, the New Zealand dairy business, has decided to start selling select products to consumers directly.
The company, listed in Australia, is offering consumers the chance to buy KeyDairy-branded milk powders via keydairy.co.
“This new e-commerce website for the company offers a further distribution channel for the company’s milk powders and importantly further validation and access for local consumers targeting international markets,” Keytone said today (4 August). “The KeyDairy product range will continue to be rolled out as products and packaging are redesigned and released to market in the short term.”
Meanwhile, Keytone said its manufacturing facilities in the Australian state of Victoria – which has implemented new lockdown measures after a spike in Covid-19 cases – would continue to operate.
Meat production in Victoria is to be scaled back as part of new lockdown measures after a jump in Covid-19 cases in Australia’s second most populous state.
Tyson Foods faces complaints over safe working environment claim
US meat major Tyson Foods has been accused of making false claims in a new complaint filed with the country’s Federal Trade Commission (FTC).
Legal firm Richman Law Group filed the complaint on behalf of pressure group Food and Water Watch and poultry workers’ rights organisation Venceremos.
They are accusing Tyson of making two false claims to consumers. Firstly, that the company works with “independent” family farmers and, secondly, that it provides plant workers with a “safe work environment.”
The groups argue that worker deaths and illness tied to Coronavirus outbreaks at Tyson processing plants prove that the company’s claim that it provides a “safe work environment” is false.
And they point out that Tyson Foods contracts with farmers to raise their chickens until they are ready to be shipped to plants for processing. The groups argue that the characterisation of these farmers as “independent” is false and misleading to consumers.
Zach Corrigan, senior staff attorney at Food & Water Watch, said: “Despite what it publicly claims, Tyson workers are far from safe. In fact, they’re among the most often and most seriously injured workers in America. Consumers have a legal right to fair and honest claims regarding the products they might buy, and Tyson is clearly failing to meet this standard.
“The FTC needs to act now and compel Tyson to tell the alarming truth about the worker safety and public health impacts of its products.”
In a statement sent to just-food, Tyson said: “At Tyson, our top priority is the health and safety of our team members, their families and our communities. We take this responsibility very seriously and are doing everything we can to keep them safe and healthy. Our team members are committed to feeding the world, and that begins with the relationships we have with our independent livestock and poultry farmers and ranchers who provide us with high-quality protein. They are helping us supply safe, affordable, high quality beef, pork and chicken to our customers and consumers during this exceptionally unprecedented and trying time.”
Tesco extends improved payment terms for small suppliers
Tesco, the UK’s biggest grocer, has announced it will be extending its improved payment terms for its smaller suppliers until 31 January 2021.
The measure was introduced to help such suppliers manage their cash flow during the difficult trading environment created by the Covid-19 pandemic.
It means nearly 2,000 suppliers will continue to have their invoices paid immediately, instead of the usual 14 days.
“This extension of Tesco’s improved payment terms will mean small businesses will continue to be supported throughout the busy Christmas period and beyond,” the retailer said.
Tesco chief product officer Andrew Yaxley added: “With uncertainty in the food sector continuing, it’s vital we do all we can to support the small suppliers we partner with.”
Executives divided about economic recovery from Covid – survey
A survey by management consultancy McKinsey & Company has found that in North America and in developing markets executives have become less hopeful since early June about their countries’ economies and more cautious in their views on potential scenarios for Covid-19 recovery.
McKinsey’s latest Global Survey on the economy, published yesterday (30 July), revealed that overall expectations in these areas suggest “growing caution and uncertainty”.
But elsewhere in the world respondents’ outlooks about their countries’ economies have improved in most regions over the past four surveys.
And respondents’ outlook for their own companies is more optimistic.
“For the first time in 2020, respondents are more likely to expect their companies’ profits to increase than decrease in the months ahead,” McKinsey said.
Turning to the consumer goods sector, McKinsey’s research suggests the future is about three things: getting better at predicting demand, being alive to all the ways sales might be increased and using agile techniques to sustain the “hard-won momentum”.
It added: “For retailers – particularly grocers, apparel companies, and restaurants – the way forward starts with new ideas about revenue management (a fundamental rethink of products, pricing, and promotions might be in order) and about operating models (especially store footprints, which will depend on how soon cities reopen).”
Tyson Foods launches new Covid monitoring strategy
US meat giant Tyson Foods has launched a new nationwide Covid monitoring strategy.
The Arkansas-headquartered business, which has seen a number of its production facilities hit by outbreaks of the virus amongst its employees, said the new monitoring system has been designed with the assistance of outside medical experts and includes ongoing, data-driven Covid testing of workers without symptoms, as well as those who exhibit certain symptoms or have been in close contact with someone who has the virus.
Donnie King, Tyson Foods group president and chief administrative officer, said: “While the protective measures we’ve implemented in our facilities are working well, we remain vigilant about keeping our team members safe and are always evaluating ways to do more.
“We believe launching a new, strategic approach to monitoring and adding the health staff to support it will help further our efforts to go on the offensive against the virus.”
Tyson has already tested nearly a third of its workforce and said it plans to test thousands of workers every week across all of its facilities.
To support the effort, Tyson Foods has created a chief medical officer position and plans to add almost 200 nurses and administrative support personnel to supplement the more than 400 people currently part of the company’s health services team.
Kraft Heinz today (30 July) booked a fresh set of impairment charges alongside a set of half-year results that included higher sales and underlying earnings.
Kellogg today (30 July) raised its forecasts for key sales and profit metrics in 2020, with the US cereal and snacks major reporting first-half revenue and earnings that came in above its expectations.
Nestlé has lowered its forecast for the company’s growth in sales on an organic basis amid the volatility of trading against the backdrop of Covid-19.
The KitKat maker had previously guided to a “continued increase in organic sales growth” for 2020 having posted a 3.5% increase last year. But today, while it provided a more specific outlook, it now expects organic sales growth to slow to between 2% and 3%. The underlying trading operating profit margin (UTOP) is “expected to improve”.
“This guidance is based on our current knowledge of Covid-19 developments and assumes no material deterioration versus present conditions,” Nestlé said.
How Covid-19 is speeding up Mondelez’s push for simplicity
On our analysis pages, we’ve published the key takeaways from Mondelez International’s first-half financial results.
The US snacks major saw its first-half net revenue rise more than 3% but sales slowed in the second quarter, hit by Covid-19-related factors in Europe and in emerging markets such as India.
More strategically, Mondelez chairman and CEO Dirk Van de Put made some interesting comments about how the virus – and the way consumer shopping habits have changed – is playing into the company’s thinking about its product ranges.
“We have an opportunity to simplify our business,” Van de Put said. The Mondelez chief said the pursuit of growth can lead CPG companies to have too many products in their portfolios and too many innovation projects on the go. Covid-19 had presented Mondelez with an opportunity to “re-accelerate” its efforts to have a “cleaner portfolio”, he said.
You can read the full article here.
Canada’s George Weston hit by Covid-related costs
Canada-based food manufacturer and grocer George Weston has reported that it incurred CAD312m (US$232.4m) of Covid-19-related costs in its second quarter.
The owner of bakery supplier Weston Foods and retailer Loblaw made a net loss of CAD255m during the three month period to 13 June as a result. During the same period last year it made a profit of CAD184m.
Weston Foods has adjusted its capex plans and reduced its SG&A in an attempt to mitigate costs.
George Weston, which described this period as a “challenging and dynamic” time, saw its sales increase during the quarter to CAD12.36bn from CAD11.6bn in the corresponding period in 2019.
The company said Weston Foods’ sales had improved since the end of Q2. CFO Richard Dufresne said: “While sales for the quarter were down 14%, the last four weeks were down only 5% compared to last year.”
It added that it is also starting to see a strong recovery in the re-emerging foodservice channel.
JBS spends nearly $20m in three months fighting Covid-19
Brazilian meat giant JBS has revealed that it spent BRL100m (US$19.3m) in the March to June period in an attempt to tackle Covid-19.
It investments include expanding its bus fleet, new PPE equipment, the installation of outpatient structures, vaccinating employees members and hiring additional labour.
In a statement to the Brazilian stock exchange, on which it is listed, it said the resources were allocated to dozens of actions that are part of the prevention and protection protocol of more than 130,000 employees at its production units, distribution centres, offices and other premises in Brazil.
Between March and June JBS hired more than 10,000 people to take the places of employees who had been preventatively kept at home.
Los Angeles authorities shut down facilities after Covid-19 outbreaks
The Los Angeles Times newspaper is reporting that local health officials have ordered the temporary closure of three food facilities that they said failed to report outbreaks that sickened more than 140 employees.
According to the newspaper’s report, citing the city’s Department of Public Health, the companies affected are S&S Foods in Azusa, with 58 confirmed cases, Golden State Foods Corp. in Industry with 43 cases and Mission Foods Corp. in Commerce, with 40 cases.
It quoted Barbara Ferrer, director of the health department, as saying: “We were not notified – as we’re required to be notified once they had their three cases – and our inspectors have asked them to make some modifications to really enhance their infection control protocols at all three sites.”
The UK’s food-to-go market may not see sales fully recover to pre-Covid-19 levels for another two years, Patrick Coveney, the CEO of major supplier Greencore, said today (28 July).
US food major General Mills, the owner of the Yoplait yogurt brand, plans to increase the use of co-manufacturers to keep up with the elevated demand from the coronavirus pandemic.
J&J Snack Foods sees sales take battering from Covid-19 restrictions
US-based J&J Snack Foods has seen its Q3 sales slump by 34% on a year-on-year basis as a result of the Covid-19 pandemic.
The New Jersey snacks and ices business, behind brands such as Slush Puppie and Minute Maid, said it was hit hard during the period in question – the three months up to 27 June – as around two thirds of its sales are to venues and locations that have shut down or sharply curtailed their foodservice operations.
And it said it anticipates Covid-19 will “continue to have a negative impact on its business”.
Sales decreased 34% to US$214.6m from $326.7m in last year’s third quarter.
It also recorded a net loss of $12.6m in this year’s quarter compared to net earnings of $30.9m for the equivalent period last year. An operating loss of $19.4m in the current quarter compared to operating income of $39.0m in the year ago quarter.
Dan Fachner, J&J’s president, said: “Our retail division was strong as that end of the business continues to outperform the previous year. Much of the foodservice locations are slow to open but we continue to see improvement during our current quarter.”
Amazon set to take on UK supermarkets with free food delivery
UK broadcaster the BBC is reporting that online retail giant Amazon is set to take on the country’s supermarkets with a free food delivery service.
Buoyed by the rapid growth in online sales of groceries during the Covid-19 pandemic, Amazon is said to be keen to get a larger piece of the UK grocery trade on a permanent basis.
According to the BBC report, Amazon Fresh, which provides same or next-day grocery deliveries for customers in London and the surrounding Home Counties, will now offer free delivery on orders over GBP40 (US$51.48) to Amazon Prime subscribers.
The BBC reports Amazon as saying it will roll out this service to “multiple cities” by the end of this year.
Amazon has about 10,000 products including fresh, chilled and frozen food on sale in the UK.
Russell Jones, country manager of Amazon Fresh UK, told the broadcaster: “We’ve been planning this for a long time. It’s a big step up in volume. In the early days of lockdown all our capacity was being used. We’re confident that we can launch this service now at this point in time.”
However, Thomas Brereton, retail analyst at London-based research and analysis group GlobalData, suggested Amazon will not find the switch to full-time grocery provider an easy one.
“At the moment, people don’t really consider Amazon for food. They’ve got to build brand awareness and that takes time and a lot of investment,” he told the BBC.
“Food and non-food retailing are two very different concepts, and Amazon must be careful not to underestimate the competitiveness of the UK grocery market.”
Greencore, the Ireland-based convenience foods manufacturer, has reported its third-quarter revenue fell by more than a third amid pressure on its food-to-go sales.
London-listed Greencore, one of the largest private-label suppliers in the UK, said revenues had “recovered progressively as restrictions on population movements have eased”
However, they were still down by almost a quarter in July so far.
On a pro-forma basis, Greencore said its third-quarter revenue dropped 36% but was “23% below prior year levels in July to date”
The group pointed to “encouraging sequential improvement of demand in food-to-go categories through Q3 and into Q4”.
Over the first nine months of Greencore’s financial year, reported revenue dropped 10.6% to GBP953.3m (US$1.23bn) and food-to-go declined 16.9%. Other categories rose 1.4%.
Greencore, meanwhile, said it had agreed to sell its molasses businesses to United Molasses Marketing.
Covid-19 – and Boris Johnson’s severe illness from the virus – has prompted significant changes to UK obesity policy.
And, in this free-to-read column, just-food contributing editor Ben Cooper believes the food industry should already be pondering what might come next.
Restrictions on advertising and promotions are among measures the UK has announced today (27 July) to fight obesity, moves the food industry have labelled “a punishing blow”.
Domestic giants and foreign multinationals have invested in D2C delivery amid India’s Covid-19 lockdowns, just-food’s Raghavendra Verma reports from New Delhi.
German sales of vegan, vegetarian products rose to EUR85m in first quarter
Sales of vegetarian and vegan products in Germany rose 36% in the first quarter to EUR85.1m (US$99.6m), according to the statistical office.
Volumes climbed 37% to 20,000 tonnes from a year earlier, the German Federal Statistical Office said, adding that the value of meat substitute products for the whole of last year amounted to EUR272.8m. In comparison, the production value of meat, poultry and processed meat in 2019 totalled EUR40.1bn.
Covid-19 infections at UK meat group Moy Park
UK meat processor Moy Park, owned by US poultry giant Pilgrim’s Pride, has confirmed staff at a site in Northern Ireland have been diagnosed with the novel coronavirus.
A “small number” of employees at the facility in Ballymena have tested positive for Covid-19, Moy Park told broadcaster ITV News.
In May, Moy Park confirmed the death of an employee from Covid-19 at a plant in County Tyrone. The member of staff worked at the company’s facility on Killington Road, Dungannon.
In March, UK meat processor Moy Park saw workers at one of its plants stage a walkout over Covid-19 safety fears.
The Northern Ireland-based company said 100 workers downed tools to stage a 15-minute walkout at its Seagoe, Portadown, on 25 March.
Trade union Unite said the protest concerned what workers saw as a lack of measures to combat the spread of coronavirus.
The US snacks major noted some pluses around market share and e-commerce as the confectionery maker reported a drop in first-half sales amid shifts in consumer patterns linked to the Covid-19 pandemic.
Hershey might have seen its sales decline in the second quarter at the peak of the coronavirus outbreak but analysts were impressed with the category gains achieved in its key North American market, despite the inherent challenges.
“Hershey has outperformed the category, with sales growth across brands that accelerated as we progressed through the quarter,” Buck told analysts during a Q&A follow-up session yesterday. “Our category share grew 225 basis points in the second quarter, bringing our year-to-date share gain to 150 basis points. Importantly, we are winning share in every channel this year.”
And Buck said the demand pick-up evidenced in June is also feeding into July. “We haven’t really seen any material changes in July versus our trends. There are some geographic differences, just given the big differential across geographies as a result of Covid. I would say we’re feeling good about what we continue to see.”
After Unilever’s performance in the first three months of 2020, expectations going into the reporting of the company’s half-year numbers were subdued.
But the consumer-goods major posted six-month sales and margins that beat City expectations, sending the Magnum maker’s share price soaring.
Across Unilever’s divisions, the results came in better than had been expected, including, strikingly, at the company’s Food and Refreshment division, despite the severe impact Covid-19 has had on the foodservice market.
As with many packaged-food manufacturers, Unilever got a boost from the rise in demand for food at home as the global lockdowns of April, May and into June reshaped consumption. “The hidden jewel in the portfolio has been our in-home, food and refreshment portfolio,” Unilever CEO Alan Jope said this morning.
That’s not to say Unilever does not face challenges. The recovery of the foodservice market is likely to be gradual and uneven, slowing the rate of any rebound for the company’s Food Solutions arm. And, as Unilever CFO Graeme Pitkethly told analysts, it is “inevitable” there will be a global economic downturn, adding: “What we don’t know is the depth and length of that and we don’t know which countries are going to be hit hardest as yet.” Navigating that uncertainty will present tests on pricing, positioning and innovation.
Unilever has closed a factory in India after staff at the facility tested positive for Covid-19.
The FMCG giant told just-food workers at the plant in the northern city of Haridwar had been diagnosed with the novel coronavirus.
Lamb Weston linked to 100 Covid cases at Oregon plant
US potato products manufacturer Lamb Weston has been linked to a large-scale outbreak of Covid-19 at its French fry facility in Hermiston, Oregon.
The Oregonian newspaper, quoting data released by the Oregon Health Authority, said 100 workers at the plant have now contracted the virus, as well as 42 of their close contacts.
It reported that the outbreak at Lamb Weston’s plant has quickly grown into one of the largest workplace outbreaks in the state after the company was informed on 15 June that four employees had tested positive for the virus.
A company spokesperson told the newspaper that no Lamb Weston employees have been hospitalised as a result of the outbreak.
The facility has only just reopened after an earlier closure linked to an outbreak of the virus.
just-food has contacted Lamb Weston seeking further details.
Australia’s Inghams Group announces temporary closure of facility
Inghams Group, the Australia-based poultry business, has announced the temporary closure of a domestic facility after an outbreak of Covid-19 amongst its employees there.
Some five employees at its Thomastown Further Processing Plant in Victoria have returned positive test results for the virus.
In a statement this morning (22 July) to the Australian Securities Exchange (ASX), on which it is listed, Inghams said the site has been temporarily closed with all employees requested to self-isolate at home.
CEO and managing director Jim Leighton said: “It is imperative that we continue do everything possible to ensure the health and safety of our people, communities and to assist in controlling the spread of the coronavirus.”
Ingham’s said it has been working with the Victorian Department of Health to ensure all appropriate protocols are in place.
It added that it will be working with its customers to minimise supply chain disruptions and that it does not see the closure materially impacting its 2021 results.
Victoria has been especially badly hit by the virus of late with a record high of 191 new Covid-19 cases on 7 July prompting the authorities there to reintroduce restrictions across metropolitan Melbourne.
UK grocery sales growth slows as lockdown eased
Research published today has revealed that UK grocery sales growth has slowed as the country starts to emerge from the lockdown imposed as a result of the Covid-19 pandemic.
Market researcher Nielsen reported that grocery sales in the country rose 10% year-on-year in the four weeks to 11 July, down from 14% in last month’s report.
The data would seem to reflect the fact that hospitality and leisure outlets started to reopen in England over the period.
Pubs, cafes and restaurants in England were allowed to re-open on 4 July.
Nielsen said online grocery purchases leapt 115% year-on-year, accounting for a record 14% of all grocery spending in the UK.
Commenting on the findings, HSBC Global Research said: “As the economy opens up, growth is normalising but is still impressive.”
Bank of England economist says UK in V-shaped recovery
Andy Haldane, chief economist at the Bank of England, has said the UK economy is experiencing a V-shaped recovery from the downturn caused by the Covid-19 outbreak.
Haldane told MPs on Monday (20 July) that the economy had been growing on average at about 1% a week since May.
The Guardian newspaper reported him as saying: “Roughly half of the roughly 25% fall in activity during March and April has been clawed back over the period since. We have seen a bounce-back. So far, it has been a V. That, of course, doesn’t tell us about where we might go next.”
But the newspaper reported that he has disagreed with fellow Bank of England monetary policy committee member Silvana Tenreyro, who said the economy was struggling to grow and would stumble over the course of the next few months as consumers maintained physical distancing.
Tenreyro said the threat of rising unemployment meant Britain’s economy was probably heading for an incomplete V-shaped recovery.
Dutch restaurant industry ‘seeks court injunction on social distancing’
Restaurants and bars have reportedly taken the Dutch government to court, seeking a relaxation of the rules on social distancing.
Koninklijke Horeca Nederland (KHN) is instituting summary proceedings, Dutch TV news broadcaster RTL Nieuws reported.
KHN opposes the rules stating patrons must be one-and-a-half metres from each other.
Relaxing the measure is “the only way to save our industry and prevent catering companies from going bankrupt en masse”, KHN said, according to RTL Nieuws.
The proceedings are on Thursday (23 July).
PHW Gruppe plant ‘remains open despite Covid-19 cases’
A German meat-processing plant where more than 60 staff have tested positive for the virus is to remain open, local reports say.
The facility, part of German major PHW Gruppe, has seen 66 employees at the site in Lohne, in the north of the country, infected.
German broadcaster NDR, citing a statement issued yesterday by PHW Gruppe subsidiary Wiesenhof, said 48 of the 66 affected staff are contract workers, with a further five temporary staff.
The company has agreed with local health officials that a further 95 other workers at the site – run by Wiesenhof’s Oldenburger Geflügelspezialitäten (OGS) unit – should be quarantined.
In a statement, Wiesenhof said it would carry out a “complete disinfection” of the plant. “According to the competent authority, OGS has developed a coherent hygiene policy and the relevant rules are implemented very well on site.”
Asda HQ staff told to return to office
Headquarters staff at UK ‘big four’ supermarket Asda have been told to return to work at least once a week from next month.
It is the first such move from a major UK grocer.
The UK’s third largest grocer said it expected all its staff to spend at least some time in the head office in Leeds in northern England every week from the start of August after putting in place measures to ensure social distancing.
The UK’s The Guardian newspaper reported that up to 1,000 employees will be able to work in the office at any one time.
An Asda spokesman told the newspaper: “The number of colleagues returning to the office has gradually increased as they see the benefits of balancing home and office working, and our expectation is that all colleagues will spend some time in the office each week from the start of August onwards.”
SIAL Paris trade event rescheduled to October 2022
The biennial SIAL food industry trade show in Paris has effectively been cancelled this year, with the event moved to October 2022.
Organisers Comexposium Group said on Friday (17 July) the event was due to be held this autumn but has now been rescheduled to 15-19 October 2022.
“To enable such an international event to take place during this pandemic-hit period, SIAL Paris had planned a wide range of initiatives. However, following consultations with exhibitors and visitors, and in view of an uncertain international public health environment, the results of the survey have shifted substantially in recent days, eventually leading to a majority wishing to see the event put off,” Comexposium said in a statement.
“SIAL Paris will continue to propose content and will offer a series of new events from October 2020 onwards dealing with major global issues, trends and innovation that are set to shape the food industry of the future.”
Fonterra points to improvements in China
The dairy co-op has cited “improved market conditions” in China for changes the forecasts for what the New Zealand group estimates it will pay farmers for milk at the end of upcoming financial year.
Fonterra today (17 July) made changes two forecasts – the farmgate milk price it will pay for its 2019/20 and 2020/21 financial years.
The 2019/20 fiscal period comes to a close at the end of July. Fonterra said the forecast range of prices it has in place has narrowed from NZD7.10-7.30 (US$4.65-4.78) per kilogram of milk solids to NZD7.10-7.20 per kgMS. The mid-point, off which farmers are paid, has reduced to NZD7.15 per kgMS, down from NZD7.20 per kgMS.
However, looking further ahead, Fonterra said its 2020/21 forecast farmgate milk price range has narrowed from NZD5.40-6.90 per kgMS to NZD5.90-6.90. The mid-point has increased to NZD6.40, up from NZD6.15.
Commenting on the 2020/21 forecast, Fonterra chairman John Monaghan said the lift to the bottom end of the range was being predominantly driven by improved market conditions in China.
“After an initial shock due to Covid-19, dairy consumption in China is recovering with more people spending on food. We’re seeing customers ramp up promotional activity as they look to catch up on the sales losses incurred over lockdown.
“Elsewhere, the EU and US governments’ support measures for farmers are holding up milk production and dairy commodity prices despite the disruption they have experienced so far from Covid-19. While we expect these support measures to end at some point, it is likely they will continue through the peak of the New Zealand season.
“While there is still a high level of uncertainty in our global markets, we do see a lowering level of risk and this supports a decision to lift the bottom end of the price range.
Astral Foods’ chairman and CEO contract coronavirus
South Africa’s Astral Foods said the poultry processor’s chairman and chief executive have both contracted coronavirus.
Both chairman Dr. Theuns Eloff and CEO Chris Schutte are self-isolating at home having tested positive for the virus, the company said in a statement today (16 July). It added Schutte is classed as “high-risk” after he underwent heart surgery last summer and is under the supervision of physicians.
Chief financial officer Daan Ferreira is the main point of contact in the meantime.
Tönnies permitted to reopen part of Covid-19 hit German plant
Tönnies, which is at the centre of a Covid-19 outbreak at one of its meat plants in north-west Germany, has reportedly been allowed to reopen part of the complex following an agreement on “new health, safety and hygiene concepts”.
In June, more than 1,000 workers at part of the complex in the town of Rheda-Wiedenbrück, located in the district of Gütersloh, North Rhine-Westphalia, tested positive for the virus, and the affected site was ordered to shut until 17 July. The outbreak led to a wider lockdown of the local community in an attempt to curb the spread, measures that were lifted on 6 July.
Reuters reported part of the site was allowed to reopen yesterday (15 July) following clearance from the Rheda-Wiedenbrueck local government authority.
The reopened sections have 597 employees involved in slaughtering and seven in meat processing and work can start immediately, the authority said.
Toennies has also applied for the reopening of the rest of its meatpacking plant, the authority said. Health and safety experts will visit the plant today to examine the company’s hygiene concept and a test reopening is possible on Friday, it said, according to Reuters.
just-food has approached the company for comment.
JBS workers in US file complaints against company
Workers at a JBS plant in Greeley, Colorado, have filed a number of complaints against the Brazilian meat giant.
American broadcaster CBS said the trades union which represents workers at the plant, UFCW Local 7, sent a letter to JBS yesterday (15 July) asking for hazard pay and a safer working environment, demands that led to a brief walkout last Friday (10 July).
Amongst its complaints are claims that the management team is not wearing protective equipment, social distancing is not being observed and Covid-19 testing is not being offered on a daily basis.
The union is also unhappy that JBS allegedly met with workers directly to discuss issues rather than going through the union.
CBS quoted union president Kim Cordova as saying it had filed a complaint with the National Labor Relations Board, stating direct dealings violate the National Labor Relations Act.
A spokesperson for JBS told CBS the company has agreed to increase wages at all of its beef and pork facilities across the US.
In a statement to the broadcaster it said: “We are hopeful the local union will allow for a democratic vote on the offered increase so that our Greeley beef team members and their families can benefit from the extra pay that JBS USA plants across the country have overwhelmingly approved and currently enjoy,”
CBS said JBS has reported six deaths and 286 cases of Covid-19 at the Greeley plant since the pandemic began.
Tesco boss calls for comprehensive UK food strategy
The chief executive of Tesco, the UK’s largest supermarket group, has called for a comprehensive UK food strategy that brings together health, environment and the economy.
Writing on the FT Online website, Dave Lewis said: “What’s clear to me is that we do not take a whole-society approach to food.
“We face the worst public health crisis in generations. Economic contraction threatens the livelihoods of millions. And the point of no return on climate rapidly approaches.”
Lewis said the government-commissioned independent review of a UK national food strategy, which will soon publish its first report, must address these issues.
“But heavy-duty change cannot be left to the market. The right regulatory context, access to capital and incentives to innovate are critical,” he said.
Lewis, who steps down from the top job at Tesco in October, argued land needed to be used more efficiently, soil health improved, forests and habitats protected, carbon emission targets met, animal welfare and food safety standards upheld through trade negotiations and more healthy eating encouraged.
China ‘asks Brazil to stop exports from two meat plants’ over Covid concerns
Reports suggest says the Chinese government has asked Brazil to suspend exports from two unnamed meat plants over concerns about Covid-19 outbreaks in food-processing facilities in the South American country,
New agency Reuters, quoting “a person with direct knowledge of the matter”, said of the two plants China would like to block, one produces beef and the other processes poultry.
Brazilian newspaper Valor Econômico has also reported the request, said to have been delivered in a letter to the Brazilian Embassy in Beijing.
Reuters said the letter from the Chinese authorities also requested information related to 12 other meat plants, seeking to find out whether media reports of Covid-19 outbreaks in those facilities were true.
Brazil’s Agriculture Ministry did not immediately respond to a request for comment from Reuters.
Argentina suspends exports from eight meat plants to China after Covid outbreak
Argentina has suspended exports to China from eight meatpacking plants after an outbreak of Covid-19 amongst employees, Reuters has reported.
The news agency quoted Argentina’s food quality and safety body, Senasa.
It said Senasa spokesperson Rodrigo Conti updated the number of plants suspended from shipping to China to eight on Wednesday (15 July) after Senasa chief Carlos Alberto Paz said earlier in the day it had been six plants that were temporarily blocked from shipping to China.
“As soon as factories are in a position to re-export, we will give them the go-ahead once again,” Paz said.
Finsbury Food Group reopens Kara foodservice facility
The UK’s Finsbury Food Group has reopened a plant producing buns and rolls for the foodservice sector after closing the site in March due to reduced demand linked to the pandemic.
The Kara facility, located in the city of Manchester, reopened in June, UK-based Finsbury said in a trading update today (15 July) for the 12 months ended 27 June.
“The implementation of lockdown effectively meant that demand in the foodservice and food-to-go sectors, which together accounted for approximately 20% of total group revenue in fiscal 2019, reduced to almost nil overnight before gradually recovering to 39% of prior year levels for quarter four,” Finsbury said.
Group revenues for the year dropped almost 3% to GBP306.3m (US$385.7m), while revenues for its UK bakery division decreased 2.6%. Finsbury’s overseas unit saw revenues decline 4.9%.
“Following a strong first-half performance, which saw group revenues grow 4.7% to GBP159.4m, performance in the second half was impacted by the outbreak of the Covid-19 pandemic, with sales down 9.8% to GBP146.9m,” it added.
Australia’s competition regulator extends working agreement for food retailers
Australia’s competition regulator has said the country’s major supermarkets can continue to work together to ensure the supply of food and groceries during the pandemic under an earlier directive.
The Australian Competition and Consumer Commission (ACCC) said the ruling applies to Coles, Woolworths, Metcash and Aldi – which can opt out – and allows the supermarkets to coordinate with each other when working with manufacturers, suppliers, and transport and logistics providers, and will stand until March.
It does not, however, apply to pricing for “any retail products”.
ACCC commissioner Stephen Ridgeway said. “The authorisation facilitates supermarkets working together to ensure everyone, including vulnerable consumers or those from rural and remote areas, have fair and reliable access to fresh food, groceries and other household goods.”
Aldi to buy surplus produce from UK cheesemakers
Supermarket group Aldi is to buy nearly four tonnes of surplus stock from British artisan cheesemakers whose businesses have been affected by Covid-19.
Following the closure of restaurants and supermarket deli counters, many producers were left with unsold fresh cheese with a limited shelf life.
But German discounter Aldi has agreed to rescue nearly four tonnes of brie, hard and blue cheese from going to waste. This equates to almost 32 thousand packs of cheese.
The supermarket will be introducing a mixed case as a Specialbuy, containing a number of different cheeses including Norfolk Mardler, Cornish Blue and Sussex Charmer. It will go on sale across all Aldi stores from 23 July.
Julie Ashfield, managing director of national buying at Aldi, said: “Cheese is a staple product on most people’s shopping list, and we hope our customers enjoy these high-quality cheeses knowing they’ve helped small British businesses when they needed it most.”
California shuts down restaurants after fresh Covid-19 outbreak
The US state of California has reimposed restrictions following a spike in coronavirus cases there.
Its new restrictions include shutting down restaurants and bars.
Governor Gavin Newsom yesterday (13 June), announced a raft of measures to help contain the new spread of Covid-19 after the state saw a 20% rise in people testing positive in the past two weeks.
As well as the including the immediate halt to activities at eateries, entertainment venues, zoos and museums have also been shut down.
California has more than 330,000 Covid-19 cases, with more than 7,000 deaths.
Mondelez International is lining up plans to cut around a quarter of its SKUs as part of moves to adapt to the volatility Covid-19 has brought to trading.
UK’s Ocado says switch to online shopping is permanent
UK online grocer Ocado says there has been a a “permanent redrawing” of the retail landscape as a result of people being locked down at home to stop the spread of Covid-19 virus.
And its suggests the switch to internet shopping is here to stay.
Its comments, quoted by UK broadcaster the BBC, came as it said sales during the first half of 2020 jumped 27% to more than GBP1bn (US$1.25bn).
Chief executive Tim Steiner said: “As a result of Covid-19, we have seen years of growth in the online grocery market condensed into a matter of months; and we won’t be going back.
“We are confident that accelerated growth in the online channel will continue, leading to a permanent redrawing of the landscape of the grocery industry worldwide.”
Covid-linked hunger crisis could kill more than virus, charity warns
A new report by the UK-based charity Oxfam is warning that a hunger crisis linked to coronavirus could end up killing more people than the disease itself.
According to Oxfam, an estimated 12,000 people per day could die from hunger linked to Covid-19 by the end of the year.
By comparison, data by Johns Hopkins University shows that the pandemic’s deadliest day so far was 17 April, when 8,890 deaths were recorded.
Oxfam’s interim executive director Chema Vera said: “The pandemic is the final straw for millions of people already struggling with the impacts of conflict, climate change, inequality and a broken food system that has impoverished millions of food producers and workers.”
The charity said that among the issues that have left many unable to put food on the table are lost income caused by unemployment or a reduction in remittance payments, the lack of social support for those who work in the informal economy and disruptions to the supply chain and hurdles faced by producers.
Also contributing to the crisis are the travel restrictions related to lockdowns, which impact not just workers and farmers, but also the delivery of humanitarian aid.
China has economic “momentum” but must watch consumer demand
China’s economic recovery is “set to gain momentum”, HSBC has said, but the banking giant has called on Beijing to take action to improve the situation in the jobs market.
In the first quarter, China’s GDP shrank 6.8% year-on-year but “several sectors are showing clear signs of renewal”, Qu Hongbin, chief China economist at HSBC, said.
Public investment and infrastructure is helping China’s economy, Qu said. Industrial production was up 4.4% in May and infrastructure grew by 11.6% in the same month.
“On the downside, other parts of the economy continue to face headwinds – and while the public sector is leading the recovery, the private sector is lagging behind,” Qu said. “Private sector investment remains subdued, especially in manufacturing.”
He pointed to “muted” consumer demand, with concerns over a resurgence in Covid-19 and the tensions between Beijing and Washington. Spending on big-ticket items, such as cars and household appliances, picked up in April and May. Qu said the figures “might be driven by the release of pent-up demand”.
He added: “The demand side of the economy is also picking up more slowly than the supply side. Consumer sentiment remained cautious and overall retail sales continued to contract through May.”
Qu pointed to pressures in China’s labour market. “Average disposable income per capita in real terms fell year-on-year for the first time since the data has been collected,” he noted. “We expect central and local governments to speed up their special bond issuance to support infrastructure investment and to implement the CNY2.5 trillion (US$357.12bn) tax cuts and fee reductions announced at the National People’s Congress.”
Vegetable grower A S Green and Co. in Herefordshire hit with coronavirus outbreak
A S Green and Co., a vegetable farm in the English county of Herefordshire, has been hit with an outbreak of coronavirus, with 73 positive cases amongst its workers.
Located in the village of Mathon, west of the Malvern Hills in the neighbouring county of Worcestershire, another 200 staff are in self-isolation in their on-site caravan accommodation.
“Public Health England advises that it is very unlikely Covid-19 can be transmitted through food or food packaging, so shoppers can remain confident buying British fruit and veg,” the company said in a statement.
The site is currently closed to all visitors and no workers are being allowed to leave the farm, but appropriate assistance is being provided.
A S Green added: “We confirm that we are working closely with Public Health England and the Public Health team at Herefordshire Council to support a number of our workers that have tested positive for Covid-19. As a precautionary measure, we have arranged for testing of additional key workers including management team members and visitors connected with A S Green and can confirm all results to date outside of our site have been returned with negative results.”
Brazilian meat groups call for cut in social-distancing rules
Meat lobby groups in Brazil are reportedly requesting the government of Paraná, said to be the country’s largest chicken producing and exporting state, to reconsider local regulations over worker distancing to reduce lost output.
According to a letter dated 2 July cited by Reuters from the Brazilian Association of Animal Protein (ABPA) and two local trade groups, the bodies want Paraná state’s minimum social distancing of 1.5 meters reduced to one meter, in line with federal guidelines for meat processors.
They argue the current 1.5-meter rule cuts output by 43%, compared to 18% if the one-meter regulation was applied.
However, Brazilian labour representatives in three southern states told Reuters one meter social distancing is insufficient.
German meat processor Tönnies, which was hit by a large-scale outbreak of Covid-19 at one of its meat plants last month, has announced it will no longer be using sub-contracted labour.
UK’s reluctance to eat underlined by ONS data
Sixty per cent of UK consumers are at least “uncomfortable” with eating indoors at a restaurant, according to fresh data from the country’s Office for National Statistics.
Six in ten of those surveyed by the ONS said they would be “uncomfortable” or “very uncomfortable” about eating inside – compared to 21% who said they would be “comfortable” or “very comfortable”.
The ONS carried out a survey between 2 and 5 July to try to understand the impact of Covid-19 on the UK.
Opinions on eating indoors vary by sex and age, with 57% of men “uncomfortable” or “very uncomfortable”, compared with 63% of women. For those aged over 70, two-thirds are “uncomfortable” or “very uncomfortable”, compared with 59% of 16- to 69-year-olds.
On eating outdoors, attitudes are split more evenly, with 37% saying they would be “comfortable” or “very comfortable” and 39% saying they would be “uncomfortable” or “very uncomfortable”.
English pubs and restaurants see trade down 45% on opening weekend
Managed pub, bar and restaurant companies that opened sites in England last weekend have reported like-for-like trading 44.5% down on the corresponding weekend a year ago.
Data collected by foodservice analysts CGA, property advisers The Coffer Group and accountancy organisation RSM showed 36% of group-operated sites were open for eating and drinking inside on 4 and 5 July, the first time hospitality businesses in England were allowed to reopen fully since lockdown.
Managed pubs and bars that opened saw sales 44.7% below pre-Covid levels compared to the same weekend in 2019. Group-owned restaurants that were open were 41.1% down.
More pubs opened their doors than restaurants, the data said, with 42% of managed pubs, bars and pub restaurants trading, while 12% of restaurants were open for business.
“Trading at around 55% of pre-Covid norms may seem a disappointing result, and it won’t be profitable for operators, but it is very much in line with what we have seen in other markets,” CGA director Karl Chessell said.
“When bars and restaurants began reopening in the US during May, it was only after a couple of weeks that sales reached 54% of pre-COVID levels, according to data from Nielsen CGA, our Chicago-based research business.
“It is going to take time for the trade to return but this provides a foundation on which to build consumer confidence and adapt and improve operations.”
Scotland’s pubs and restaurants can fully reopen on 15 July. Some outdoor pubs and bars have already opened.
Reports suggest Wales will today announce pubs and restaurants will be allowed to reopen from Monday.
Pubs and restaurants re-opened in Northern Ireland last Friday (3 July).
US bakery major Flowers Foods has temporarily closed its Savannah, Georgia, facility after an outbreak of Covid-19 amongst its workforce there.
Canada’s fiscal “snapshot” outlines economic forecasts
Canada’s GDP is projected to decline by almost 7% this year, the country’s Finance Minister, Bill Morneau, has said.
Citing private-sector economists, Morneau said Canada’s economy is expected to contract by 6.8% in 2020 as a whole, its sharpest drop since the Great Depression, before recovering some of the lost ground, with a rebound of 5.5% in 2021.
Canada is forecasting a CAD343.2bn (US$254.34bn) deficit in the 2020-21 fiscal year, compared to a pre-pandemic projection of CAD34bn.
The leap is due to the money Canada’s government has been spending to try to prop up the country’s economy and protect jobs.
That help has principally come through two financial aid programmes – the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Response Benefit (CERB).
The subsidy scheme has paid out CAD18bn to more than a quarter of a million firms. It offers to cover 75% of a business’ salary bill.
In May, some 40% of CEWS applications were in the “accommodation and food services” industry, Canada’s federal government said.
UK foodservice to see VAT cut
Rishi Sunak, the UK Chancellor, has announced the country’s government will lower VAT on hospitality and leisure services, which includes restaurants and pubs.
The sector will see VAT lowered from 20% to 5%, as the UK government tries to support a sector hit hard by the Covid-19 lockdown and protect jobs.
In another move to encourage hesitant diners to frequent outlets again, Sunak also unveiled a scheme to give 50% off to UK consumers who dine out in August.
To support restaurants and the people who work in them we’re saying ‘Eat Out to Help Out’.
— Rishi Sunak (@RishiSunak) July 8, 2020
Ian Wright, chief executive of The Food and Drink Federation, which represents food manufacturers operating in the UK, said: “The UK’s food and drink manufacturers who supply into the hospitality and catering trade have been hard hit by the crisis, as their customers disappeared overnight. These ‘squeezed middle’ firms will enthusiastically welcome the Chancellor’s announcement today to cut VAT on food and hospitality and slash the cost of eating out. We hope these measures will lead to a significant boost in demand for the hundreds of manufacturers who supply into hospitality and the out of home sectors and help them to manage increased supply costs.”
Meanwhile, more broadly, the UK government will pay firms a GBP1,000 (US$1,254) bonus for each staff member retained for three months when the country’s furlough scheme ends in October.
The FDF’s Wright added: “However, if demand does not return quickly, these firms will continue to struggle unless they – and the sector they supply – receive additional employment support. The Chancellor must therefore keep the option of extending full furlough support to hospitality and their food and drink suppliers in his back pocket so we do not lose vital jobs and businesses.”
Nearly 100 Covid-related deaths in US meat plants in April and May
The latest figures from the US-based Centers for Disease Control and Prevention (CDC) reveal that there were around 17,000 Covid-19 cases and nearly 100 deaths in April and May in the country’s meat plants.
Its statistics, quoted by news agency Reuters, are based on surveillance data from health departments in 23 states up until 31 May for all meat and poultry facilities affected by the coronavirus.
Among cases in states where demographic details were available, 87% occurred among racial and ethnic minority workers.
Some 12% of the reported cases were asymptomatic or pre-symptomatic, CDC said.
JBS reports Covid outbreak at another Brazilian plant
Brazilian meat giant JBS has said 2.2% of workers at its domestic Goiania beef plant have Covid-19.
A statement sent to news agency Reuters said the workers have been placed on leave after testing positive for the virus.
The unit employs 900 people and remains in operation.
Reuters said the statement came in response to a question about whether JBS would comply with a labour court decision handed down by Judge Camila Vigilato on 2 July 2 ordering the company to test all workers at that facility after an outbreak.
Covid-hit Toennies plant sees closure extended
The meat factory at the centre of a major spike in Covid-19 infections in Germany has reportedly been ordered to stay closed until 17 July.
Local officials have extended their order to shut the factory, located in Gütersloh in north-west Germany, although it is reported production can gradually resume before the new deadline if Tönnies can offer convince health officials of its protocols at the site.
More than 1,500 staff at the factory tested positive for the novel coronavirus, prompting a local lockdown to try to stem its spread.
Toennies, one of the largest meat processors in Europe, was accused by officials of withholding data and hindering work to try and trace contacts of the affected staff, a charge the company denied.
2 Sisters Covid-hit meat plant in Wales re-opens
The meat-processing facility in the Welsh town of Llangefni closed on 18 June after Covid-19 infections among staff has re-opened today (3 July).
Full production will not resume until Monday, owner 2 Sisters Food Group said “to allow for extensive additional measure awareness training sessions”.
The company said today the first reported positive case at the facility was on 28 May.
“As a responsible company, we believe took the right action by temporarily suspending operations for 14 days so we could be sure all our people were kept safe and we had an opportunity to supplement our existing control measures,” 2 Sisters said. “While it is far too early to say how and why the virus spread, at this stage we are leaving no room for doubt by briefing our people, starting Friday, on the new measures and how every single person should take personal responsibility for their own behaviours.”
A meat factory in northern England owned by retailer Asda reportedly has a number of Covid-19 cases but remains operational.
Walkers Crisps, the UK snacks business owned by US food and beverages giant PepsiCo, has seen an outbreak of Covid-19 amongst the workforce in its facility in Leicester in the English Midlands.
BMPA rejects union claims of “dire” working conditions in meat plants
The British Meat Processors Association (BMPA) has hit back at claims by the trade union Unite that conditions in some meat plants in the UK are “dire”.
The industry body suggested Unite’s claims are “muddying the waters in the fight to understand and combat the coronavirus pandemic”.
BMPA chief executive Nick Allen said: “Our member companies work to strict hygiene and safety controls imposed by the Food Standards Authority, Public Health England and the Health and Safety Executive. While working temperatures are necessarily cold in parts of the factory, workers are given the protective clothing and equipment they need to keep them and the food they produce safe.
“These highly-regulated working conditions apply equally to all staff from the skilled butchers in the boning and cutting halls to the support staff who keep the canteens and offices running; it’s one standard for everybody.”
Earlier this week Unite argued the UK meat sector – and government – must tackle working conditions in the industry, the country’s largest trade union has argued, insisting Covid-19 has underlined the issues facing particularly migrant workers.
Unite said there is “a direct correlation between the treatment of migrant staff as disposable assets and the spread of the disease”.
Employees at Oscar Mayer-owned Rowan Foods facility ‘do not feel safe’ – report
UK broadcaster the BBC has said that its investigations have revealed that some workers at the Rowan Foods facility in north Wales do not feel safe following a Covid-19 outbreak.
The BBC report quoted one worker at the plant in Wrexham – linked to 237 coronavirus cases – as saying it is impossible to keep social distance.
Its investigations team said it saw evidence of personal protective equipment (PPE) not always being used and recent photos from inside the factory of people standing near each other and not wearing visors.
Rowan Foods, owned by UK manufacturer Oscar Mayer Ltd, has said it has introduced screens and visors, amongst other safety measures, to keep workers safe.
Welsh pubs and restaurants with outdoor seating set to reopen
The Welsh government has announced new plans to allow pubs, cafes and restaurants with existing outdoor seating to reopen from 13 July.
As long as cases related to the Covid-19 pandemic continue to fall, venues can open in spaces owned by them and those that have licences for it can also reopen. However, indoor services will remain closed, despite pressure from the industry.
A “long road” to economic recovery – Deutsche Bank
Analysts at Deutsche Bank have issued cautious forecasts for major global economies, arguing we face a “long road to recovery”.
“The global economy is in a severe recession. We now see global GDP remaining below its pre-virus levels through most of next year,” Deutsche Bank analysts wrote. “Although the shock will fall well short of the Great Depression, it will still result in immense rises in unemployment, putting pressure on national treasuries for some time to come.”
Looking at the US, Deutsche Bank forecasts the country will “experience a record contraction in Q2, and rebound only slowly beyond that”. Deutsche Bank forecasts US GDP will shrink by 7.1% this year, followed by growth of just 2.6% in 2021.
However, the analysts warned: “Broad-based rising case growth in recent weeks raises the risk that the current re-openings could be rolled back, as has happened in Texas.
Eurozone GDP will fall by 12% in 2020, Deutsche Bank forecast, before growing by 5% in 2021.
“The shock is asymmetric,” the analysts said, with Germany set to see a decline in GDP of 9%, while France and Italy “perform worse”, with falls of 14% each.
Deutsche Bank had a brighter outlook for China. “We have upgraded our 2020 growth forecast for China to 1.1%, and see 8.4% growth in 2021,” it said. “Given the robust economic recovery and stronger-than-expected exports, we have lowered our expectations for further stimulus.”
China ‘suspends imports from Brazil, Netherlands plants’
Beijing has reportedly barred shipments from meat factories in Brazil and the Netherlands said to have been hit by outbreaks of Covid-19.
According to Reuters, customs authorities in China has temporarily prohibited imports from three plants in Brazil
The news agency said China has declined to name the facilities but, citing sources, Reuters said sites owned by Marfrig and JBS were among the three.
The Guardian, meanwhile, quoting a Dutch government official, said China had banned meat from four factories in the Netherlands.
Beijing had not given a reason for the move but the official said all of the plants had seen Covid-19 outbreaks.
UK meat industry needs “root and branch” reform
The UK meat sector – and government – must tackle working conditions in the industry, the country’s largest trade union has argued, insisting Covid-19 has underlined the issues facing particularly migrant workers.
Unite said there is “a direct correlation between the treatment of migrant staff as disposable assets and the spread of the disease”.
The union claimed some factories do not provide staff who need to self-isolate company sick pay or any other form of financial support, which it argued “increases the danger of individuals with Covid-19 going into work because they cannot afford to take time off”.
Unite also raised concerns about track-and-trace record keeping for agency workers, such as production line staff and cleaners, who it says often work at multiple sites.
“Migrant workers, who often do not speak English and are scared to speak out because they fear losing their jobs, suffer under a relentless system that long predates Covid-19 in which they are treated without dignity or respect,” Unite national officer Bev Clarkson said.
“It is imperative that ministers and industry commit to a root and branch reform of the meat processing sector. The dire working conditions, low pay and insecure employment that blight the industry and have now come back to bite the nation’s efforts to defeat the coronavirus must be addressed.”
just-food has asked the British Meat Processors Association for comment.
India extends food-security scheme
Narenda Modi, India’s Prime Minister, has announced the extension of the country’s food-security programme.
India implemented the scheme – Pradhan Mantri Garib Kalyan Anna Yojana – when the country went into lockdown to try to ensure the poor had adequate food.
Those eligible were to receive 5kg of foodgrains per month. On top of that, each household were provided with 1 kg free whole chana a month.
The scheme had been due to elapse at the end of June but has now been extended until the end of November, Modi said. He added the extension would mean India’s government will have spent INR1.5trn on the food packages.
India set for “worst economic slump in decades”
India’s GDP is on-track to decline more than 5%, Dutch investment bank ING has forecast.
ING said it sees India’s economy contracting by 5.2% in 2020, a revision to its earlier forecast for a drop of 2.1%.
“The five most Covid-19-affected Indian states – Maharashtra, Delhi, Tamil Nadu, Gujarat and Uttar Pradesh – make up 43% of India’s GDP. Recovery here will hinge on the return of a large number of migrant workers, though not all of them are likely to be reabsorbed back into disrupted supply chains, while weak demand continues to hinder activity,” ING economist Prakash Sakpal said.
“Meanwhile, high unemployment should depress spending and prices, though there are no signs of consumer price inflation abating just yet. On the contrary, resurgent food inflation resulting from supply disruption and panic buying, and high fuel prices due to recent hikes in excise duty, are pressuring inflation.”
World Bank offers forecast on Thailand GDP pressure
Thailand’s economy is expected to be impacted severely by the Covid-19 pandemic, shrinking by at least 5% in 2020 and taking more than two years to return to pre-pandemic levels, according to the World Bank’s latest Thailand Economic Monitor, released today.
Covid-19 shocked the Thai economy, especially in the second quarter of 2020, and has led already to widespread job losses, affecting middle-class households and the poor alike.
As Thailand starts to ease mobility restrictions, domestic consumption, Thailand’s traditionally strongest driver of growth, may pick up in the second half of 2020 and in 2021, the World Bank said, but economic recovery will be gradual and uncertain.
“The strength of the economic recovery will depend in part on an effective policy response, in particular effective support to vulnerable households and firms,” said Birgit Hansl, World Bank country manager for Thailand. “As the recovery phase begins, a key challenge will be how to help people who lost their jobs reconnect with the labour market. Active labour market measures, such as wage-subsidies targeted to individuals in the most vulnerable sectors, and for on-the-job training to promote reemployment should be explored.”
Aryzta plants start to ramp-up as Covid-19 restrictions ease
Swiss-Irish bakery business Aryzta, which is in the midst of a strategic review amid pressure from shareholders, said the company is adjusting production upward as Covid-19 restrictions begin to ease in a number of markets.
In a trading update issued today (30 June), Aryzta said only one of its plants in Europe remained in pause mode as a result of coronavirus, compared to three at the end of April, with 80% of its production lines now operational.
In North America, where the bakery business has been struggling in recent years, one production facility is still paused versus five on 30 April, with 90% of its production lines operational.
The company added that 22% of staff remain furloughed, down from 30% at the end of April.
However, foodservice and convenience retail are still an impediment to revenue growth due to work-from-home policies and a drop in tourism in Europe, where quick-service restaurants and in-store bakery are “gradually improving”.
In North America, “signs of recovery” are concentrated in the QSR and retail channels, while foodservice remains “negatively impacted”. Foodservice is still under pressure in Aryzta’s rest of the world region, while in Asia Pacific QSR has “rebounded”, but Brazil “remains more challenging”.
JBS, the Brazil-based meat behemoth, has reportedly been ordered to close one of its domestic factories amid concerns about Covid-19 – a plant that was also shut recently amid worries about infections.
Nearly 300 positive Covid-19 tests at Tyson Missouri facility
US meat giant Tyson Foods has revealed that 291 employees at its facility in Noel, Missouri, have tested positive for coronavirus.
The company said some 1,142 employees were tested between 17 and 19 June. Of the 291 who tested positive, 249 showed no symptoms of having contracted the virus.
The 291 is in addition to 80 positive cases identified by the Missouri Department of Health & Senior Services or by workers’ own health care providers.
To date, Tyson has conducted nearly 40,000 tests throughout the country, covering more than one-third of its US-based employees. Testing at the Noel facility was done in partnership with Matrix Medical, a medical clinical services company.
Tom Brower, senior vice president of health and safety at Tyson Foods, said: “We believe it’s imperative that we share our experience addressing this pandemic because safety is not a point of competitive advantage.”
Tyson has designated more than 500 team members as social distance monitors in its facilities, amongst other anti-Covid measures.
Scotland-based Browns Food Group is considering making a number of staff redundant following a Covid-19-linked reduction in business from the foodservice and food-to-go channels.
Australian supermarkets re-introduce rationing as Covid-19 cases surge
Australian supermarket groups Woolworths and Coles have introduced customer buying limits on some essential items after a spike in Covid-19 cases in the southern state of Victoria led to some panic-buying.
The UK’s The Guardian newspaper reported that rationing has been introduced on toilet paper and also food items including pasta, flour, eggs, sugar and mince.
It said Victoria reported its tenth straight day of new cases in double digits on Friday (26 June). Some 30 new cases were reported.
Latvia’s Food Union sets up multi-country D2C operation in response to Covid-19
Latvia’s Food Union has launched an e-commerce platform for European consumers.
Delivering ice cream, dairy products, pastry and frozen food directly to customers, the service covers Latvia, Lithuania, Romania and Denmark via local distribution operations.
Normunds Stanevics, Food Union Group CEO Europe, said: “Covid-19 has done more to change consumer habits and behaviour than any event in modern history. We’re moving rapidly to demonstrate operational agility, create new delivery services, and meet our customers’ needs.”
The company said its goal is to diversify sales channels while ensuring its products are geographically closer to consumers.
Tulip confirms three employees tested positive for virus
Meat processing business Tulip, owned by US meat giant Pilgrim’s Pride, has confirmed an outbreak of Covid-19 among the workforce at one if its UK facilities, involved three workers.
Reports earlier this week mistakenly suggested around a dozen workers had tested positive for the virus at its pork plant in Tipton in England’s West Midlands.
In a statement today (26 June), Tulip said it is continuing to work in collaboration with Public Health England (PHE) Midlands, the Health & Safety Executive (HSE), local NHS colleagues and the local Sandwell Council, following confirmation of cases of Covid-19..
The three employees affected, including two from the same household, received positive test results after more than 100 tests were carried out on a sample of the Tulip workforce on 22 June.
All three, together with anyone identified as having had close contact with those who have tested positive, are now isolating at home in line with government guidelines.
Tulip employs more than 640 people at the Tipton site, which is facing closure.
Princes, the UK food group owned by Japanese conglomerate Mitsubishi Corp., closed a UK facility for 24 hours this week after a Covid-19 outbreak among its workforce.
Covid-19 outbreak at Kepak meat factory in Wales
Ireland-based meat group Kepak has an outbreak of Covid-19 among staff at a factory across the Irish Sea in Wales.
At least 34 employees have tested positive since 25 April, with eight confirmed this month.
Vaughan Gething, Wales’ Health Minister, confirmed what he called “a small cluster” at the Kepak site in Merthyr Tydfil.
Asked for comment by just-food on the situation, Kepak referred to a prepared statement. It read: “Kepak Group is designated by the Irish and UK governments as an essential service provider; we aim to ensure that our customers have an adequate and quality supply of food for consumers throughout this Covid-19 pandemic. All our sites remain safely operational.
“At Kepak, the health and safety of our staff, customers and suppliers is our key priority. As such, we are actively engaging with our employee forums, and with the relevant Public Health Agencies to ensure that best practice Covid-19 control measures and procedures are implemented and adhered to across all our sites. Kepak continues to observe all public health protocols during this pandemic.”
More than 150 positive tests at Asda meat plant
Operations at a meat plant owned by Asda, the UK’s third-largest grocer, have re-started but it has emerged 165 employees have tested positive for Covid-19.
The factory in Kirklees in West Yorkshire, which trades as Kober Ltd, halted production last week after a number of staff were confirmed as having the novel coronavirus.
Output resumed this week but local health officials said today a total of 165 staff have the disease.
“I’d like to thank Kober for acting quickly and working with us and Public Health England to help manage this outbreak,” Rachel Spencer-Henshall, director of public health at Kirklees Council, was quoted as saying by broadcaster ITV News.
“They reopened their factory on 23 June on a reduced capacity and only colleagues that have been tested and declared fit to return are on site. We’re satisfied with health and safety measures on site which include separation of colleagues on different shifts and as an additional precaution, checking the temperature of colleagues before they enter the site.”
UK Cadbury workers said to be resentful over Covid-19 bonuses
A UK trade union has claimed that Cadbury workers in the country are becoming increasingly resentful that they are not being paid the same bonuses for working during the coronavirus pandemic as colleagues in the US and the European Union.
Unite is calling on Cadbury’s parent – US snacks and confectionery giant Mondelez International – to level up the playing field and said it is consulting with more than 1,200 employees members at Cadbury sites in the English Midlands and Wales over how to respond to the issue.
Mondelez said it is “disappointed” with the comments.
Unite is calling on Mondelez to follow the example of other major international food manufacturers which have provided extra payments for UK staff who have worked during the lockdown.
Unite national officer Joe Clarke said: “Throughout the crisis, Cadbury’s workers have put themselves at risk and shown great flexibility, working longer hours to compensate when the workforce was reduced by as much as 30% because of the lockdown.
“There is growing resentment amongst Cadbury staff that Mondelez workers in the US, France, Belgium and Spain have been given bonuses while their hard work is yet to be recognised. This is particularly galling given Cadbury’s strong performance during the crisis, which has been achieved through the hard work of our members.”
A Mondelez spokesperson said: “We understand this has been an uncertain time for everyone, including our colleagues and we’ve been incredibly grateful for their hard work and commitment over the past three months.
“Our number one priority throughout has been their health, safety, and well-being and we have gone beyond many others to proactively put in place extensive measures in this space, many of which have been openly recognised by Unite.
“This includes offering emotional and well-being support, implementing health screenings, temperature checks, social distancing measures and making face masks available at all our factories.
“We have also helped colleagues by offering greater flexibility to support their personal needs, for example paid emergency leave, accommodating shift swapping and flexing of work patterns, as well full pay for those who are shielding themselves or have family members who are required to shield.
“We are therefore disappointed with Unite’s comments as they fail to reflect all we are doing to recognise and support our people during this time.
“We’re continuing to discuss with union representatives so we can try and resolve any issues as soon as possible, in the best interests of all our colleagues.”
Covid-19 has altered customer behaviour around food consumption, survey says
A survey produced by investment bank Wells Fargo suggests that quarantined consumers may not return to pre-lockdown routines, something that could have major implications for foodservice suppliers.
“Our survey work suggests Covid has altered customer choice around food consumption (where, when and how), which is likely to have an impact over the next several quarters (or years) for companies under our coverage as consumers adjust to a new, and hopefully temporary, norm,” the bank said
“Our survey of one thousand shoppers supports a more constructive view for grocers and food manufacturers and a more selective view on restaurants and distributors.”
The survey suggests consumers will be willing to return to dining out if states reopen successfully, but food away from home consumption may remain below pre-Covid levels for some time.
“Approximately 70% of respondents indicated they would be comfortable returning to a restaurant with the proper safety precautions and no local spike in cases. However, only one third indicated that visit frequency for restaurant dine-in occasions would return to pre-Covid levels in the foreseeable future, with dinner most impacted,” the bank said.
The survey also suggested “grocery store trip consolidation” may be here to stay.
“Once the crisis is over, one third of respondents expect trip consolidation to remain a theme and two thirds indicated that grocery stores are the most likely format to retain their food spending,” Wells Fargo, which analyses the performance of major packaged food companies, said.
It suggested the shift to grocery pick-up or delivery is sustainable.
“[Of the] 40% of respondents [who] utilised grocery pick-up or delivery, the vast majority were satisfied with the service and almost 70% of these respondents plan to utilise it even after the crisis ends,” Wells Fargo said.
In terms of packaged foods, the survey suggested previously poorly positioned categories will benefit.
“Roughly one third [of respondents] plan to maintain elevated consumption for each of cereal, yogurt, soup, and pasta/mac & cheese,” it said.
German government advisers issue GDP forecast
Germany’s GDP won’t bounce back to pre-pandemic levels until 2022, economists advising the country’s government have warned.
The German Council of Economic Experts (GCEE) forecasts the country’s real GDP will decline by 6.5 % in 2020.
For 2021, the GCEE expects GDP to bounce back, growing again by 4.9%, describing the decline and subsequent recovery as a “pronounced V”.
Moreover, they suggest Germany’s unemployment rate “will continue to rise in the coming months and will only start to decline in the course of 2021”.
“The weak external environment will put a significant burden on German exports this year,” the GCEE cautions. “The global spread of the coronavirus has led to a deep recession of the world economy.”
Germany’s GDP rose 0.6% in 2019. “Consequently, GDP is unlikely to return to its pre-?pandemic level before 2022,” the GCEE explains.
However, the advisers add: “The outlook for further economic development remains subject to considerable uncertainty. In particular, the course of the pandemic is of major importance. A significantly longer phase of weak economic development is expected, if the number of new infections cannot be kept at low levels, for example by smart distancing, if the easing of public health interventions does not continue and if uncertainty of companies and households is not reduced.”
JBS ordered to test workers at meat plant for Covid-19
Brazilian meat giant JBS has been ordered to test all workers for Covid-19 at a Rio Grande do Sul meat plant, news agency Reuters has reported, quoting labour prosecutors.
It said yesterday’s announcement came on the same day that JBS raised the number of meatpacking plants with confirmed cases of coronavirus to 32.
JBS declined to comment on the decision when contacted by Reuters, saying the Três Passos plant remained open.
The news agency reported that a labour court ruled that JBS should test all workers at the plant in five days, as well as put on paid leave any employees who test positive for Covid-19, for a minimum of 14 days.
There are more than 1.1m infected with Covid-19 in Brazil and 52,000 people have died from the virus.
Restaurants set for return in England
The UK’s latest moves to ease lockdown measures will see restaurants, pubs and bars allowed to open again on 4 July in England, Prime Minister Boris Johnson said.
With public health a devolved issue in the UK, much of Johnson’s statement to Parliament centred on measures in England. Scotland, Wales and Northern Ireland devise their own strategies for Covid-19 lockdowns.
Announcing the moves this afternoon (23 June), Johnson also said the rule stating people need to keep two metres away from each other is being reduced to “one metre plus”, where the full two meters is not possible.
From 4 July, people will be allowed to meet with one other household at a time indoors, as long as social distancing is maintained, Johnson added.
Update – area under Tönnies plant enters lockdown
This morning, the head of the western German state of North Rhine-Westphalia announced a fresh lockdown for the Gütersloh area, where a factory operated by meat giant Tönnies has seen more than 1,500 staff test positive for Covid-19 (see below link).
Armin Laschet said amenities in Gütersloh such as bars, museums and cinemas would be closed, while picnics and barbecues would also be prohibited. People will only be able to have contact with thei rown household or one person from outside.
More than 1,000 staff from a Tönnies meat plant in Germany have tested positive for Covid-19 and become a factor in a spike in the R, or reproduction, number of the virus in the country.
The outbreak among workers employed at the facility, located in Gütersloh in north-west Germany, was yesterday (22 June) described as “massive” by Chancellor Angela Merkel’s chief spokesperson.
Meat processing business Tulip, owned by US meat giant Pilgrim’s Pride, has confirmed an outbreak of Covid-19 among the workforce at one if its UK facilities.
The UK government has revealed plans it hopes will ensure the country’s food and drink industry and agriculture sector bounce back successfully from the impact of coronavirus, with an emphasis on overseas trade opportunities.
Covid-19 cases at 2 Sisters plant ‘rise above 150’
The number of staff who have tested positive for the novel coronavirus has reportedly reached 158.
On Thursday, 2 Sisters decided to close a processing plant in Wales for 14 days because of Covid-19 infections.
The poultry facility in the town of Llangefni, Anglesey, reportedly had 13 confirmed cases a few days ago with another 110 people self-isolating, although 2 Sisters declined to confirm the numbers.
The BBC yesterday (21 June) reported the number of infections had hit 158.
“As of 15:00 BST on Sunday 21 June we have recorded an increase of 83 confirmed positive cases identified over the past 24 hours,” the broadcaster quoted Dr Christopher Johnson from the Public Health Wales agency as saying.
“Testing of employees continues, and it is likely that some additional cases will be identified in the coming days.
“The increase in cases is as we anticipated when a focused track and trace programme is implemented, and does not mean that the spread of infection is increasing.”
just-food has approached 2 Sisters for comment.
US food and beverages giant PepsiCo has closed a food processing plant in Beijing due to a Covid-19 outbreak.
Reuters reported the decision was taken after “at least one employee” tested positive for coronavirus at the facility which produces Lay’s crisps.
China has suspended poultry imports from a plant owned by meat group Tyson Foods that has been hit by a Covid-19 outbreak.
Italian dairy company Parmalat, owned by French peer Lactalis, is to launch an e-commerce offering after what its describes as the “unprecedented growth” of online shopping during the Covid-19 period.
Three UK meat and prepared-food factories have this week emerged as sites where multiple staff have tested positive for Covid-19 – but trade union Unite claims there are more sites “suspected” to have outbreaks among workers.
Unite told just-food today (19 June) it has had “reports from more than five sites where concerns have been raised” about suspected outbreaks.
World Bank: COVID-19 recession is expected to be twice as bad as the 2009 financial crisis
The World Bank has warned forecasts suggest the global recession caused by the novel coronavirus will be the deepest since World War II.
There will be biggest proportion of economies experiencing declines in per capita output since 1870, the organisation said.
It also stated the output of emerging market and developing economies (EMDEs) is expected to contract in 2020 for the first time in at least 60 years.
The World Bank said the global economy has experienced 14 global recessions since 1870: in 1876, 1885, 1893, 1908, 1914, 1917-21, 1930-32, 1938, 1945-46, 1975, 1982, 1991, 2009, and 2020.
It warned the Covid-19 recession will be the deepest since 1945-46, and more than twice as deep as the recession associated with the 2007-09 global financial crisis.
“The Covid-19 global recession is unique in many respects,” the World Bank said. “It will be the most severe since World War II and is expected to trigger per capita GDP contractions in the largest share of economies since 1870. It is also associated with unprecedented weakening in multiple indicators of global activity, such as services and oil demand, as well as declines in per capita income in all EMDE regions.”
Our US columnist Victor Martino today (19 June) set out how CPG companies can steer their way through choppy economic waters.
“CPG companies need to create a new playbook to deal with a US market experiencing an economic recession plagued with a whole lot of uncertainty,” he wrote.
“CPG companies, particularly the big guys, tend to fare better than many other industries in recessionary periods. But such times require changes to how brands are managed.
“What can CPG companies do to drive brand growth during the coronavirus-induced economic recession? And what can they do to position brands once the economy starts to rebound, which could possibly be as early as this fall?”
Two more food factories in the UK have reportedly been affected by outbreaks of Covid-19 among staff.
Asda, the UK’s third-largest food retailer, has confirmed its meat plant in Kirklees in West Yorkshire has stopped operations after employees tested positive.
Meanwhile, Oscar Mayer Ltd has said more than 30 workers at its Rowan Foods facility in north Wales have been infected.
2 Sisters Food Group, the UK-based poultry supplier to major supermarkets, has taken the decision to close a processing plant in Wales for 14 days because of Covid-19 infections.
The poultry facility in the town of Llangefni, Anglesey, reportedly had 13 confirmed cases a few days ago with another 110 people self-isolating, although 2 Sisters declined to confirm the numbers.
However, from today (18 June), the company has decided to halt production at the site.
2 Sisters said in a statement: “In light of the current Covid-19 cases at our Llangefni site, we have decided to take the necessary action to clearly demonstrate how seriously we take this issue by doing the right thing.
“The health, safety and wellbeing of our colleagues is ultimately the thing that matters most at our business. We are a responsible company with people at its core. Without our people we are nothing.
“We will not tolerate any unnecessary risks – however small – for our existing loyal workforce at the facility.”
2 Sisters said it had worked closely with local health authorities and health and safety bodies, as well as the trade union Unite, in coming to the decision.
Switzerland’s Orior gets boost from retail sales
Rapelli meats and Noppa’s tofu owner Orior said today (18 June) rising sales with retail customers has offset most of the decline with its foodservice customers amid Covid-19 lockdowns.
Orior, which was among scores of food manufacturers that pulled guidance for 2020 in the early weeks of the pandemic, said business with retailers “remains very strong”.
In a stock-exchange filing ahead of the publication of its first-half results next month, Orior said that growth “will compensate for most of the decline in revenues from the foodservice sector” – although that statement, it said, excludes Casualfood, the division mostly operates in airport terminals, supplying products such as sandwiches, salads, muesli and smoothies.
Orior added: “With the re-opening of restaurants and international borders and the gradual resumption of air travel, business in these important sales channels, which have been heavily impacted by the corona crisis, will slowly recover. The performance of these sales channels during the first few weeks after restrictions were eased was very positive in light of the general environment.”
The company will report its first-half numbers on 14 July.
Trade groups representing UK food and drinks manufacturers have joined hands to urge the Government to take action to provide support to those supplying the country’s foodservice sector, which has been hit hard by the lockdown.
Whitworths looks to D2C for “new phase” of growth
Whitworths, the UK-based dried foods producer, is launching a direct-to-consumer service for its fruit, nuts and seed products.
The Northamptonshire firm’s online store will serve consumers and businesses alike across the UK, including retailers and manufacturers, with no minimum order.
Phil Gowland, Whitworths’ commercial director, said: “We are excited to announce our new online shop, allowing us to reach consumers directly with new ideas as well as providing businesses the opportunity to more easily access our bulk branded and raw material products.”
He said the online store will play a “huge role” in the company’s “new phase” of growth.
China ‘testing all imports of meat’ amid fresh Covid-19 outbreak
Bloomberg, citing an unnamed executive at a “major supplier”, has said customs officials in China are testing all imports of meat for the novel coronavirus.
A fresh outbreak of Covid-19 has been linked to a wholesale food market in Beijing.
The new infections are reported to have been traced to a chopping board used by a seller of imported salmon, Bloomberg said.
The unnamed executive told Bloomberg customs officials are carrying out nucleic acid tests on all shipments. Officials have also started testing every consignment within the shipments, instead of taking random samples, the executive added.
Regulators around the world have consistently said that, so far, there is no evidence Covid-19 can be transmitted through food.
Citing Norway’s fisheries and seafood minister, Reuters has reported that officials from the country and in China have concluded Norwegian salmon was likely not the source of the fresh outbreak.
Deloitte’s caution about link between US mobility and spending
Analysts at Deloitte Touche Tohmatsu have been looking at data on the mobility of US citizens and their spending.
“Unfortunately,” Michael Wolf, an economist at Deloitte, wrote this week, “the consumer spending data suggests the US outlook is not nearly as optimistic as the mobility data would otherwise indicate.”
Wolf said: “For example, mobility near retail and recreation establishments in April was just 41% below its baseline in the Unites States, whereas in Europe it was anywhere from 52% lower (Germany) to 89% lower (Spain). That did not translate to a softer decline in retail sales in the United States. Indeed, US retail sales fell 16% in April, far worse than the 5% decline in Germany and even the 10% drop in Italy.”
Since then, mobility near retail and recreation establishments in the US has improved, Wolf said.
US mobility was 24% lower in the last week of May. German mobility was slightly better at 22% below its baseline, while UK mobility was down 64%, “the worst among the large European countries”,” Wolf said.
However, he added: “Judging by the Johnson Redbook weekly retail sales, which posted its worst ever year-over-year decline for the week of June 6, US consumer spending remained weak through the first week of June despite the ongoing improvement in mobility. An unrelated measure of retail activity shows that US foot traffic at retail stores remained depressed while foot traffic in Italy has climbed notably higher.”
And Wolf warned there was “a similar theme” in the US restaurant sector. “In the first week of June, restaurant bookings in the US were 79% lower than a year ago. That is considerably worse than the bookings in Germany, which were just 24% lower than a year ago. Recall that mobility in Germany and the United States were strikingly similar at the end of May.”
TSC Foods, the UK company behind the Glorious soup brand, has entered consultations with employees over 200 potential redundancies after the UK-based soup manufacturer saw foodservice sales collapse in the midst of the Covid-19 lockdown.
Outbreak among staff at 2 Sisters factory
Covid-19 has reared its head at a 2 Sisters Food Group meat-production plant in Wales.
The poultry facility in the town of Llangefni reportedly has 13 confirmed cases among staff, with 110 people self-isolating.
2 Sisters would not confirm numbers but, in a statement, said: “Our key priority now is to continue to provide the safest possible working environment and support all our affected colleagues at Llangefni, as we have been doing for more than two months without one single case.
“The health, safety and wellbeing of every colleague is of paramount importance to us, which is why we have had a series of measures in place for some time including regular and intensive deep cleaning and disinfecting regimes, the wearing of protective visors in production areas and implementing social distancing throughout the factory.
“We continually review and evolve these measures to ensure we have the safest possible working environment; for instance we have recently introduced thermal temperature checks for all colleagues and employed marshalls to ensure social distancing is maintained in high traffic areas.”
Nomura issues GDP forecasts
Japan-based investment bank and brokerage Nomura has made a series of GDP forecasts as the global economy splutters into action amid some easings of Covid-19 lockdowns but faces real pressure from subsequent spikes of the disease.
In Nomura’s home market, the bank predicts that, with the novel coronavirus spreading, GDP will keep declining for three quarters through the end of the second quarter, followed by “a gradual recovery”.
In Asia more broadly, Nomura expects Covid-19 to “derail” GDP growth, with a 1.3% year-on-year fall in 2020, compared to growth of 5.2% in 2019.
Looking at the US, Nomura said it foresees “a short, but steep, recession” in the first half of 2020 before a gradual recovery aided by fiscal and monetary accommodation. “The unemployment rate will rise sharply, peaking around 20% in Q2, as labor market conditions deteriorate due to Covid-19,” Nomura said.
The bank, meanwhile, said it had “axed again” its forecasts for UK GDP and see a recession in H1 – with output falling by more than 15% vs Q4 2019.
A ‘sharp but short’ recession: Morgan Stanley economists’ “confidence” in forecast for V-shaped recovery
Output will return to pre-coronavirus crisis levels by the fourth quarter of 2020, according to Morgan Stanley economists, cited by Bloomberg.
Economists at the Morgan Stanley, led by chief Asia economist Chetan Ahya, said yesterday (14 June) they have “greater confidence” in the banks’s “call for a V-shaped recovery, given recent upside surprises in growth data and policy action”.
Predicting a “sharp but short” recession, the Morgan Stanley economists said they expect global GDP growth will fall by as much as 8.6% in the second quarter when measured year-on-year but recover to growth of 3% by the first quarter of 2021.
All of mainland France enters “green zone”
France has changed the alert status of its mainland territory, allowing cafes and restaurants to fully reopen.
As of today, the whole territory – with the exception of the overseas départements of Mayotte and French Guiana where the virus is still actively circulating – passes into the French government’s “green zone”, which allows in particular a stronger resumption of work, and the reopening of cafes and restaurants in Île-de-France, or the Paris region.
Dès demain, tout le territoire – à l’exception de Mayotte et de la Guyane où le virus circule encore activement – passera dans la « zone verte », ce qui permettra notamment une reprise plus forte du travail, et la réouverture des cafés et restaurants en Île-de-France.
— Emmanuel Macron (@EmmanuelMacron) June 14, 2020
“As soon as tomorrow, we will be able to turn the page on this first chapter across all our territory,” Emmanuel Macron, France’s President, said in a televised address yesterday evening.
Scotland has decided to pause plans to limit the way foods high in fat, sugar or salt can be promoted in the country.
Joe FitzPatrick, Scotland’s minister for public health, said there were no longer plans to introduce the Restricting Food Promotions Bill in this parliament, which ends in May 2021.
“We remain fully committed to restricting the promotion and marketing of foods high in fat, sugar or salt where they are sold to the public and will seek to progress this measure as soon as it is possible to do so,” FitzPatrick said. “Pausing the introduction of the bill provides us with an opportunity to take stock, take into account the impact of the Covid-19 lockdown, including on people’s diet and healthy weight.”
Bakkavor says volumes starting to stabilise across key markets
Bakkavor, the UK-based private-label supplier to major supermarkets, said it is starting to see a stabilisation in volumes across its key markets in the UK, the US and China that were all hit to varying degrees by the coronavirus outbreak.
Having seen a “sharp reduction” in volumes in the US and UK in the back-end of March and into April, coming later than the decline in the Chinese market toward the end of January, Bakkavor said all three regions are showing “early signs of recovery”.
Still, like-for-like revenues for the five months to the end of May were down around 5%, it said in a trading update to the London Stock Exchange.
The UK remains “volatile”, however, amid what the company said is “historically low levels” of shopping visits, with revenues 19% lower in April and down 13% in May.
In China, Bakkavor said its foodservice customers have reopened the “majority of their restaurants and stores” and consumer confidence is starting to return as lockdowns ease.
The “puts and takes” facing US packaged-food majors post-Covid
In the latest note from its analysts covering the US packaged-food market, investment bank AllianceBernstein has sketched out what it sees as the major factors that could affect the performance of some of the major names in the sector.
With the latest US sales data coming out of Nielsen showing some of the major names in the country’s packaged-food industry continuing to see sales growth decelerate after the stockpiling-fuelled highs of March/April, thoughts are turning to what could be the prospects for some of the household names in the sector over the longer term.
Looking at the very near term, the AllianceBernstein analysts said today (11 June) they expect the “elevated retail sales growth” seen by US packaged-food manufacturers “to be partially offset by declines in the foodservice channel for those with meaningful exposure”.
The analysts said they also expect US food companies to incur increased operating costs during the pandemic, which could partially offset the benefits of volume-led sales gains.
“As we look out to the medium to longer term, we expect a number of puts and takes in terms of the pandemic’s longer-term impact on US food companies,” they wrote. On the positive side, the listed US food companies the analysts cover could “benefit from improved retailer relationships and a focus on core SKUs from larger brands at the expense of smaller brands”.
They add: “The shift to e-commerce could also benefit big brands that can afford the premium shelf space online.”
On the other side of the coin, the AllianceBernstein analysts argue thus: “As this was a health-based crisis, there could be more focus on health and wellness from both consumers and regulators. Consumers could also shift away from heavily-processed packaged food as more people become comfortable with cooking from scratch.”
And the wariness among some consumers about “heavily-processed” food that we saw before the pandemic hit will likely return in the longer-term, the analysts suggest.
“We expect the long-term structural pressures to resume for the US-centric food companies as consumers continue to demand less heavily processed, better-for-you food options. While we expect some trade-in from food-away-from-home to food-at-home during a recession, this is likely to be largely offset by a further trade-down from branded to private-label food products. During the financial crisis, Campbell Soup Co., General Mills, Kellogg and J.M. Smucker generated flat/negative volume growth while private-label gained circa 160 basis points of market share.”
Orkla-owned Easyfood lets go of 13 staff
Easyfood, the Denmark-based business owned by Norway’s Orkla, is to lay off 13 workers as the company adapts to the coronavirus crisis.
The maker of bread-based convenience products said it had to cut production teams down to two from six in March as the virus took hold, and put 57 employees on furlough under the support of the Danish government.
However, while Easyfood is now operating four production teams, its CEO Flemming Paasch said the company will withdraw from the state support scheme, and as a result is letting 13 staff go.
Paasch expects Easyfood “will be back on track by 2021 and will be able to return to the normal six production teams”.
There is “increasing evidence” showing a link between obesity and the severity of illnesses from Covid-19 illness – and deaths, new research published in the UK has claimed.
Germany relaxes restrictions on seasonal workers
The German government has eased entry restrictions for seasonal farm workers that were introduced to help stop the spread of coronavirus.
From 16 June until 31 December, seasonal workers from the European Union and the passport-free Schengen zone will be allowed to freely enter Germany by land or air to help harvest crops,
Agriculture minister Julia Kloeckner announced on Wednesday (10 June): “Until the end of the year, farmers can employ additional seasonal workers from abroad.
He added: “It’s in all our interests that farmers can keep harvesting and sowing.”
German farms usually require some 300,000 foreign harvest helpers a year. They mainly come from Poland and Romania.
Under the new guidelines, workers have to keep at least 1.5 metres distance from each other and work in small teams.
OECD predicts grim post-Covid outlook for world economies
The Organisation for Economic Co-operation and Development (OECD) has predicted that as Covid-19 restrictions begin to ease the “path to economic recovery remains highly uncertain”.
The inter-governmental organisation, which has 37 member countries, said in its latest Economic Outlook that the Covid-19 pandemic has triggered the most severe recession in nearly a century and is causing enormous damage to people’s health, jobs and well-being.
With “little prospect of a vaccine becoming widely available this year, and faced with unprecedented uncertainty,” the OECD has presented two scenarios – one in which the virus is brought under control, and one in which a second global outbreak hits before the end of 2020.
If a second outbreak occurs triggering a return to lockdowns, world economic output is forecast to plummet 7.6% this year, before climbing back 2.8% in 2021. At its peak, unemployment in the OECD economies would be more than double the rate prior to the outbreaks, with little recovery in jobs next year, it said.
If a second wave of infections is avoided, global economic activity is expected to fall by 6% in 2020 and OECD unemployment to climb to 9.2% from 5.4% in 2019.
“The economic impact of strict and relatively lengthy lockdowns in Europe will be particularly harsh. Euro area GDP is expected to plunge by 11.5% this year if a second wave breaks out, and by over 9% even if a second hit is avoided, while GDP in the United States will take a hit of 8.5% and 7.3% respectively, and Japan 7.3% and 6%,” it said.
The OECD’s predictions make for particularly grim reading for the UK. It thinks the country’s economy will contract by 11.5% in the event of a single hit and by 14% if the virus returns.
JBS approved to re-open Rondonia beef plant
Brazilian meat titan JBS has received permission from a court in Brazil’s state of Rondônia to re-open a beef plant where 266 employees tested positive for Covid-19, according to news agency Reuters.
Quoting locally-based labour prosecutors, Reuters reported the plant was allowed to resume activities on Friday (5 June) after the entire workforce there was tested for coronavirus.
The plant employs 900 people in São Miguel do Guaporé, a town of only 23,000 inhabitants.
Reuters said the labour prosecutor’s office criticised the ruling that authorised the plant to reopen on June 4, only days after a 27 May order to close it.
Prosecutors also called on JBS to remove all employees who had contact with sick workers while enforcing at least 1.5 metres of physical distancing on the plant’s production lines.
Nomad Foods, the European frozen-food business, has seen unprecedented online demand during the Covid-19 lockdowns as sales growth through the channel almost doubled in April.
US food group Rich Products, pointing to the impact of Covid-19, today (9 June) outlined moves to further restructure its business in the UK, which could lead to 100 staff being made redundant.
“Whilst bakery sales across the grocery and out-of-home market are beginning to rebuild, the sector has been dramatically affected by Covid-19, particularly with the closure of coffee shops and café outlets,” a Rich Products spokesperson said.
UK private-label major Bakkavor is considering the future of a fresh food facility at Spalding, Lincolnshire, in the English east Midlands. Hundreds of jobs could be lost as a result.
Chinese dairy giant Mengniu has issued a profit warning, blaming increased costs linked to the Covid-19 outbreak.
South Africa-based RCL Foods has issued a profit warning related to the coronavirus outbreak and the subsequent lockdowns and suspension of its foodservice operations.
Final numbers will be presented around 31 August.
Mars has launched a dedicated online store in India in partnership with delivery platform Swiggy for a range of the US-based firm’s confectionery brands.
Kalpesh Parmar, the general manager for Mars Wrigley India, said: “Mars Wrigley is using the digital commerce platform in an innovative way to reach maximum consumers. We believe consumers are looking for occasions to treat themselves and creating moments of joy for everyone in the family while they stay at home. We are ensuring the products that customers value are made available to them with greater ease and in ways that remains protective of public health.”
Confectionery maker Hershey also recently joined with Swiggy and its peer Dunzo in India. Nestlé, PepsiCo, Kraft Heinz, Impossible Foods and Beyond Meat have all embraced D2C as an alternative channel to retail over the past few months to bolster revenues amid Covid-19.
Nomura sets out countries at risk of “second wave”
Japan-based investment bank and brokerage Nomura has developed a “visual tool” it says helps weigh up the risk of a second wave of Covid-19 as economies re-open.
Nomura has assessed 45 “major economies” and ten US states, dividing each into three classifications: “on track”, “warning signs” and “danger zone”.
Of the 45 countries, 17 are deemed by Nomura to be “on track”, offering “increasing mobility and no sign of a second wave”. Fourteen of these countries are in Europe, joined by Australia, South Korea and Thailand.
Those under Nomura’s “warning signs” classification include Germany, the Netherlands, Turkey, the UK and the US. Amid increasing mobility, there are, Nomura says, “tentative warning signs”.
Fifteen countries are in the bank’s “danger zone” and “most at risk” of a second wave of the novel coronavirus, including Brazil, India, Mexico, Saudi Arabia and Sweden.
“The tool is based on the latest available daily data on Google mobility and confirmed Covid-19 cases. While the latter is updated every day, mobility index lags by about one week,” Nomura said.
“Our visual tool has yielded a mixed bag of results: 17 countries are on track with respect to reopening economies with no sign of [a] second wave; 13 countries are showing some tentative warning signs and 15 countries in danger zone of being most at risk of a second wave, the latter group largely comprising of emerging market countries.”
In late-March, the UK’s lockdown meant, overnight, wholesalers’ bread-and-butter foodservice market dried-up, forcing them to rethink their businesses. Some jumped straight into supplying the public direct, others sold into supermarkets. On our analysis pages today, David Burrows looks at whether these strategies could stick.
Dutch processor Vion re-opens meat plant
Vion Food Group has resumed production at a factory in the Netherlands that had seen more than 100 staff test positive for Covid-19.
The company has re-opened the facility in eastern Dutch town of Groenlo shut last month.
Vion said it had been given the green light by local health officials, who will monitor measures at the site. There will be “daily large-scale cleaning and disinfection” at the Groenlo plant. All employees will have daily health checks, the company added.
Suntory chief ‘sounds warning over Japan foodservice outlook’
In an interview with Reuters, the chief executive of Japanese food and beverage giant Suntory forecast a fifth of the country’s bars and restaurants could go out of business due to the pandemic.
“If you ask me how much will return, I’d say roughly, around 80% will be back,” Takeshi Niinami, Suntory’s CEO and also an economic adviser to the country’s government, told the news agency.
Japan, a country with a population of around 127m, has so far avoided a large-scale outbreak of the novel coronavirus. Data published in the Japanese media today showed the country had seen 932 people die from Covid-19. Those who have tested positive number 17,924.
UK savoury snacks maker Addo Food Group is to take on 65 new employees at a plant in England to help it meet increased demand during the Covid-19 outbreak.
Saputo said it will take another “couple of quarters” before the Canada-based dairy firm’s foodservice business returns to pre-coronavirus levels as its chief executive noted how he is open to acquisitions in the sector.
Arla Foods said its foodservice sales in the European dairy group’s home market of Denmark rose 30% in the past two weeks as canteens, restaurants and cafes began to reopen having been shutdown to curb the spread of Covid-19.
London-based data and analytics company GlobalData suggests prolonged turbulence in the meat industry caused by Covid-19 could be detrimental to consumer confidence.
US jam, peanut butter, relishes and snacks maker J.M. Smucker has reported Q4 sales figures that have been massively boosted by the Covid-19 factor.
Nestle’s operations resume in India
Nestlé said operations have resumed at all of its manufacturing facilities and distribution centres in India that had been working at scaled-down capacity due to the Covid-19 outbreak.
It is now in the process of scaling-up operations with “stringent safety practises” in place, Nestlé said in a stock exchange filing.
“Due to the unpredictable and fast-changing Covid-19 situation, it is very difficult to assess the future impact of Covid-19 on business operations and it is expected to evolve over a period of time,” Nestlé noted. “However, we are confident about our ability to manage this crisis through our financial stability, our trusted brands, our consumers, our committed employees and our quality of leadership.”
Campbell Soup Co. has made a significant upgrade to its financial guidance across key metrics after the US food group experienced “unprecedented broad-based demand” in the third quarter due to coronavirus-linked shopping behaviour.
The global animal-protein industry is “vulnerable to zoonotic outbreaks and guilty of creating them”, new research from an international investor group has claimed.
FAIRR, a network of global investors aiming to create awareness over environmental, social and corporate governance (ESG) issues with US$20trn in assets, has said Covid-19 is “a warning of the role modern animal production systems can play in increasing zoonotic disease risk”.
The group has called on the animal-protein sector to “tackle lax safety standards for food and workers alike, closely confined animals and overused antibiotics”.
Tyson reveals results from Covid-19 tests at Iowa plants
US meat giant Tyson Foods has revealed that some 815 workers across two plants in Iowa have tested positive for coronavirus.
The company released results from Covid-19 testing at its Storm Lake pork processing plant and its Council Bluffs beef and pork facility yesterday (2 June).
At Storm Lake, 2,303 employees were tested and 591 tested positive. Tyson said 75% of those who tested positive showed no symptoms.
Limited production at the facility will resume today (3 June) following a temporary halt during which additional deep cleaning and sanitising was conducted.
Tom Brower, senior vice president of health and safety for Tyson Foods, said: “As in Storm Lake, we are routinely finding high levels of asymptomatic positives when we test widely at our plants and because of that, we can do a public service by sharing the results with the local community.”
At its Council Bluffs facility, Tyson tested 1,483 employees and 224 of them tested positive for Covid-19. Some 103 of those have been through their required absence and have now returned to work.
More than half of individuals who tested positive did not show any symptoms.
The Council Bluffs plant is among more than 40 production facilities in the US where Tyson is rolling out testing capabilities with the medical clinical services company Matrix Medical.
Mash Direct, a prepared-vegetable products supplier based in Northern Ireland, sells on both sides of the Irish Sea and across the island of Ireland. COO Jack Hamilton tells Dean Best how the family-owned firm has adapted to Covid-19, with the pandemic affecting parts of the business in different ways.
Northern Ireland-based Mash Direct, a supplier of prepared-vegetable products, does business in its home market, mainland Great Britain and the Irish Republic. The family-owned company turns over north of GBP20m (US$25.1m) a year and, as the Covid-19 pandemic hit, was growing its top and bottom lines.
However, like businesses across the packaged-food industry, big and small, Mash Direct has had to react quickly to the way the novel coronavirus has shaken up the sector. Almost a third of the firm’s turnover is generated through the foodservice channel.
Mash Direct did, however, see sales to its grocery-retail customers (which take in major retailers on both sides of the Irish Sea) jump in the early weeks of the lockdowns in the UK and Ireland, while COO Jack Hamilton says the company launched a direct-to-consumer service that may become a permanent part of the business.
JPMorgan Chase & Co. issues forecast on US consumer spending
Analysts at the US investment bank have been reflecting on the latest data coming out of the US and setting out their forecasts for consumer spending in the country in the second quarter. It makes for sobering reading.
Discussing not just the Covid-19 pandemic, the economic recession and now the political division and racial tension that have hit the US, Dr. David Kelly, chief global strategist at J.P. Morgan Asset Management, wrote: “Recently, the forces pulling us apart have seemed stronger. But just as there are cycles in the economy, so there are cycles in politics and society and there will be many better years ahead than 2020. Still, we can’t unfortunately fast forward this movie to those better years and, for investors and those advising them it is still important to understand the nature of the recession into which we have fallen. While this has been a recurring theme in recent months, every few days we get new information which can help us track both of the depth of the downturn and the speed of a potential recovery.
“Last week’s numbers on consumer spending, durable goods, inventories and international trade gave us a better understanding of just how far we have fallen. In particular, real consumer spending fell 13.2% in April following a 6.7% March decline. This was worse than expected and, even with a substantial recovery in May and June, we expect real consumer spending to fall an extraordinary 43% annualised in the second quarter. This, combined with weaker trade and inventory data, suggests that real GDP overall could fall by roughly 41% annualised in the second quarter of this year, before rebounding by 18% annualised in the third.”
Dr. Kelly sought to emphasise how he believes any real pick-up in the US economy will come when a vaccine for Covid-19 is widely administered.
“It should be emphasised that the apparent strength of this rebound is largely a reflection of the depth of the downturn, particularly in April of this year. Moreover, we continue to expect that the economy will only show true acceleration when a vaccine has been widely distributed,” he said. “Because of this, while real GDP could fall 13.7% in absolute terms from its cyclical peak at the end of last year to the second quarter of this year, it may only gain back a quarter of this extraordinary decline in the third quarter and output could still be lower in the fourth quarter of 2021 than in the fourth quarter of 2019.”
China’s possible “U-shaped recovery” will still be uneven – S&P Global
Financial analysts at S&P Global have been casting their eye over China’s economy and believe it’s “showing visible signs of re-emergence and recovery”.
“China’s economy is healing. Indicators point to a U-shaped recovery assuming Covid-19 remains contained,” S&P Global Ratings’ Chief Asia-Pacific Economist Shaun Roache wrote.
Roache, however, had a caveat that will be of interest to those in FMCG.
“Unsurprisingly, healing is uneven. Large firms are finding their feet faster than small firms, and industry is recovering faster than the service sector. We estimate that just three months after the peak in Covid-19 cases in early February, large industrial firms were back at 95% of normal capacity. Manufacturing output rose by 5% in April compared with a year ago. Not all industries are firing at the same time, however. The technology sector has rebounded, autos have stabilised, and consumer goods are still below 2019 levels.”
Marfrig ‘agrees to bring in enhanced protection measures for meat plant workers’
Brazilian meat heavyweight Marfrig has reportedly agreed to introduce enhanced protection measures against the Covid-19 virus for its meat plant workers.
News agency Reuters said that the company has signed a settlement with labour prosecutors in its home market to make working conditions safer for its employees against a backdrop of the virus spreading in meat plants in recent weeks.
Quoting a statement from the labour prosecutors, Reuters reported that additional protective measures agreed upon include routine testing of workers for coronavirus and introducing a mandatory 1.5 metres in physical distancing between workers at the company’s 12 plants in Brazil.
It also said Marfrig is to test all of its 18,000 workers starting today (2 June) as part of efforts to combat the spread of the virus.
And it will immediately remove “symptomatic workers” from its plants for a minimum period of 14 days.
Local food more important to German consumers in wake of Covid-19 – government
Local food has grown in importance among consumers in Germany since the onset of Covid-19, a government survey has suggested.
In the latest edition of an annual government report into Germany’s eating habits, more than four in five of consumers surveyed said it is important food comes from the local region. The importance of the regional origin also depends on the product
The German government said more consumers want to “increasingly use seasonal products with short transport routes”.
Julia Klöckner, Germany’s Federal Minister of Food, Agriculture and Consumer Protection, said: “Local food has become more important. A new awareness of food has arisen – and of the work of those who produce it. This new esteem needs to be maintained.”
According to the survey, 39% of those questioned stated that agriculture had become more important for them during the Covid-19 crisis.
‘Brazilian court gives OK for JBS to re-open poultry plant’
Brazil-based meat giant JBS has been given clearance to resume production at a poultry plant closed since 18 May.
According to Reuters, JBS can re-start processing at the facility in Ipumirim, which is located in the southern state of Santa Catarina.
Citing labour officials, the news agency said that, when the company was ordered to close the factory, there had been 86 confirmed cases of Covid-19.
China economic recovery slower than expected – HSBC
Labour market pressures, weak consumption and a slump in global demand mean bankers at HSBC have said they expect China’s GDP to slow to 1.7% this year – down from growth of 6.1% in 2019.
Beijing has reduced interest rates during the Covid-19 crisis, with additional re-lending and rediscount facilities for agriculture and smaller firms.
Banks’ reserve-requirement ratio has also been lowered to free up more liquidity into the financial system.
However, Qu Hongbin, chief China economist at HSBC, said an expansion of monetary policy “usually takes time to filter through into the real economy”.
“Companies increase investment as credit becomes easier and household spending rises but the transmission into industrial production can take around five months and twice as long for credit conditions to be reflected in nominal GDP,” Hongbin said.
He also pointed out how manufacturing firms’ first-quarter profits were down by 39% compared to 2019.
Meanwhile, Hongbin added, China’s high savings rate makes household spending less sensitive to looser monetary conditions. Stable wages and jobs are bigger drivers of domestic consumption.
“So, the delay in monetary conditions feeding through into the real economy means China’s domestic growth recovery is likely to remain slow in the near-term. We thus believe Beijing will step up monetary easing, with credit growth accelerating by lowering interest rates and reserve-requirement ratios even more this year.”
UN warning on food security
The United Nations World Food Programme has warned that an estimated 265 million people could face acute food insecurity by the end of 2020, up from 135 million people before the crisis.
Food producers are facing large losses on perishable and nutritious food as buyers have become limited and traders stop engaging with farmers.
The World Bank has called for collective action to keep food trade flowing between countries.
The UN body has listed four food security “hot spots”:
- fragile and conflict-affected states, where logistics and distribution are difficult even without morbidity and social distancing
- countries affected by multiple crises resulting from more frequent extreme weather events and pests such as the current locusts plague – the worst in decades— impacting food production in 23 countries
- the poor and vulnerable, including the more than 820 million people who were already chronically food insecure before the COVID-19 crisis impacted movement and incomes
- countries with significant currency depreciation, (driving up the cost of food imports) and countries seeing other commodity prices collapse (reducing their capacity to import food).
France reveals restaurant opening date
France has announced the country’s restaurants, cafes and bars will start to re-open on 2 June.
Edouard Philippe, France’s Prime Minister, said outlets in certain areas would only be allowed to open terraces.
Restaurants, cafes and bars in what France calls “orange zones” can only open their terraces. Those zones include Ile-de-France, the country’s most populous region, which takes in Paris. The French capital is no longer deemed a “red” coronavirus danger zone, according to Philippe. The rating still means Paris is not as free as the majority of French regions, which are designated “green”.
Compte tenu de l’évolution de la crise sanitaire, les restaurants, bars et cafés pourront ouvrir dans tous les départements à partir du 2 juin. Dans les départements qui font l’objet d’une vigilance particulière, seules les terrasses pourront ouvrir au 2 juin. #déconfinement
— Edouard Philippe (@EPhilippePM) May 28, 2020
Nous allons surveiller avec une vigilance particulière les départements d’île-de-France, la Guyane et Mayotte, où le virus circule plus qu’ailleurs. Dans ces départements « oranges », le #déconfinement sera, pour 3 semaines, un peu plus prudent que sur le reste du territoire. pic.twitter.com/5bgWownjoF
— Edouard Philippe (@EPhilippePM) May 28, 2020
Standing at the counter remains prohibited.
Employers’ union GNI-HCR cautiously welcomed the news.
“Even if for the vast majority of professionals, the time is for relief, everyone knows that only one step has been taken, or is about to be taken, and that the hardest part remains,” the union said in a statement.
“First, we will have to reassure our employees that their health will not be affected by their work because measures are taken such as wearing a compulsory mask for everyone and limiting contact with customers. Then our customers, who are impatient to find us but who legitimately do not want to put themselves in danger. To them too, we say, measures are being implemented.”
Turkey’s Erdogan announces reopening of restaurants from June 1
Turkey President Tayyip Erdogan has said Turkey will lift restrictions on intercity travel and allow restaurants, cafes, parks and sports facilities to reopen from Monday (1 Jun as the country eases restrictions imposed to curb the coronavirus outbreak.
Service will be allowed until 10pm, Erdogan said.
Announcing a series of measures to ease Turkey’s lockdown, he added: “I wish that the decisions we make will be beneficial for our country and nation. In the new normal order, I am again saying these three concepts: Masks, distance, cleaning … Let’s not neglect these issues. Let’s go around with the mask, be sure to pay attention to the physical distance, definitely pay attention to cleanliness, these are our three essentials.”
US union calls for more protection for meat factory workers as death total hits 44
The United Food and Commercial Workers International Union (UFCW) has reported that 44 meat plant employees have died in the US from Covid-19 and is calling calling on the Trump administration and meat companies to do more to protect workers.
UFCW’s latest figures reveal more than 3,000 infections among US meatpacking workers.
It estimates that 22 plants have closed at some point in the past two months. These closures have impacted more than 35,000 workers and reduced pork slaughter capacity by 25% and beef slaughter capacity by 10%, it said.
It has written to US agriculture secretary Sonny Perdue and vice president Mike Pence asking for better protection measures to be introduced in meat plants.
UFCW International president Marc Perrone said: “America’s food processing and meatpacking workers are in extreme danger, and our nation’s food supply faces a direct threat from the coronavirus outbreak. If workers in these plants are as essential as our elected leaders say, then it’s about time that our elected leaders provide them with the essential protections they need.”
US meat titan Tyson Foods is to temporarily close its Storm Lake pork processing plant in Iowa following a mass outbreak of Covid-19 amongst its employees there, reports suggest.
News agency Reuters reported an Iowa state official as saying 555 employees at the plant tested positive for the virus, about 22% of the workforce.
Reuters further reported Tyson said yesterday (28 May) it will close the facility on a temporary basis as a result.
The free-from cereals and snacks manufacturer, which also supplies fresh milk and milk drinks and plant-based beverages, expects full-year profits to be “materially impacted” by the Covid-19 outbreak as the crisis hit sales in the out-of-home segment.
And the Sydney-listed business also revealed it had made “some redundancies” across the company as a result of the “reshaping of its commercial and organisational structures to reflect the new operational footprint”, which is based around Freedom Foods’ focus on markets in Australia, China and south-east Asia.
Lobby group calls for UK government action on obesity to help tackle Covid-19
UK healthier food campaign group Action on Sugar and Salt is calling on the country’s government to tackle issues relating to obesity, which has been linked as a Covid-19 risk factor.
The government is due to publish a report on how factors including obesity, ethnicity, income and gender can affect the impact of the coronavirus on people’s health.
The campaign group has presented an “evidence-based plan” which it said will provide support for those living with obesity, while improving health for all in the long term.
Its plan includes providing guidance for identifying modifiable risk factors and increasing access and funding for evidence-based weight loss support.
It is also calling for a ban on the advertising and promotion of unhealthy products and for the government to make nutrition labelling mandatory.
Meat-free to have stagnant 2020 before rebound in 2021 – research
Global retail sales of meat-free products are to dip in 2020, affected by Covid-19, before rebounding next year, new research suggests.
Meat-free sales are forecast to hit US$4.7bn this year, down 0.7% on 2019, according to analysis from UK-based data and analytics group GlobalData.
Stripping the impact from Covid-19 from the numbers, meat-free sales were set to grow 6.5%, Carmen Bryan, consumer analyst at GlobalData, said.
However, GlobalData is forecasting retail sales of meat-free products will bounce back, rising more than 8% in 2021.
Bryan said Kellogg’s recent decision to delay the launch of its Incogmeato product in the US “makes sense” given the way the market looks to be developing this year.
“Kellogg’s decision to delay its new launches will prove wise in the coming years, as 2021 is expected to bring a sharp rebound for the meat substitutes market. By holding out, the company will be able to launch its new faux-burger line in favourable conditions, capitalising on the renewed demand from consumers.”
Nestlé has partnered with Deliveroo to provide a range of its confectionery directly to customer’s doors in the UK as the Covid-19 crisis makes it difficult for shoppers to get to store.
Marfrig reports cases at Várzea Grande plant
Brazil’s Marfrig Global Foods has 25 cases of Covid-19 at its plant in Várzea Grande in the state of Mato Grosso.
The meat processor said the facility continues to operate, although health and safety protocols have been put in place to protect workers, such as temperature controls and limited access.
Any employees who had contact with the infected workers are in isolation at home.
Meanwhile, any staff suffering from flu symptoms, pregnant women, people with chronic diseases and those over 60 years old have been told to stay away from work.
Tyson linked to more than 200 Covid-19 cases at Texas plant
More than 200 workers at US meat giant Tyson Foods’ plant in Sherman, Texas, have tested positive for Covid-19, it is reported.
US broadcaster NBC reported that some employees at the plant had already tested positive for the virus when, just over two weeks ago, the state conducted a large round of tests on more than 1,600 workers over a two-day period.
The results showed that 220 came back positive and three showed to be inconclusive, it said, quoting local county officials.
While not commenting on the number of workers impacted at the plant, Tyson told NBC it had “put in place a host of protective measures that meet or exceed CDC and OSHA guidance”.
JBS Brazil plant ‘closed amid Covid-19 outbreak’
Brazilian meat behemoth JBS has seen one of its domestic plants closed won following a Covid-19 outbreaks amongst employees there, it is reported.
News agency Reuters said the JBS plant in the state of Rondonia has been closed on the order of a labour court until the company tests all workers there for coronavirus.
A ruling seen by the news agency said that more than 60% of the cases already confirmed in the municipality are inside the company.
JBS did not have an immediate comment, Reuters said.
BRF warns that plant closures could hit its production levels
BRF has said the potential closure of slaughterhouses due the spread of coronavirus at meat production sites would make it impossible to keep output at current levels.
News agency Reuters quoted the Brazilian meat giant’s CEO Lorival Nogueira Luz as saying: “We have to be aware that if contagion worsens and authorities see the need to close units it is mathematically impossible to ensure production levels.”
There are no BRF plants closed due to the outbreak, but at one point, the company’s Lajeado facility in Rio Grande do Sul state had been shut by authorities to contain the spread of the disease among workers.
“We have to be aware that if contagion worsens and authorities see the need to close units it is mathematically impossible to ensure production levels,” Luz said.
BRF said this week nearly 340 meatpacking workers at a its Concórdia plant, which employs 5,132 people, had tested positive for the virus and would be submitted to further testing,
Adelie Foods, the UK food-to-go supplier, has appointed administrators after Covid-19 hammered orders at the sandwich and bagel maker, which employs more than 2,000 people.
Global meat industry to decline by 5.3% this year due to Covid-19 – research
London-based research and analysis business GlobalData is forecasting that the global meat market will value US$1.3trn by the end of 2020, reflecting a year-on-year decline of 5.3%.
“This is a stark contrast to the expected robust baseline growth the industry was experiencing pre-pandemic. Prior to Covid-19, the global meat industry was expected to grow at an annual rate of 2.6% over 2020 to reach a value of $1.4trn,” GlobalData said.
Carmen Bryan, consumer analyst at GlobalData, added: “Meat is a staple food in many cultures worldwide, thus the global downturn is evident of the current uncertainty and supply disruptions many markets are facing. Although production will stabilise in the long-term, a full recovery to a pre-Covid-19 value is unlikely.”
Tyson worker dies from Covid-19 – report
An employee at US meat giant Tyson Foods’ largest pork processing plant at Waterloo, Iowa, is understood to have died after contracting the Covid-19 virus.
US broadcaster CNN reported that the worker passed away on Monday (25 May).
The plant was temporarily shut down in April after a major outbreak of the virus at the facility. It reopened on 7 May.
In a statement sent to CNN, a Tyson spokesperson said: “We are deeply saddened by the loss of any Tyson team member and are keeping the family in our thoughts and prayers at this difficult time.”
Meanwhile, Tyson has revealed that 257 of the employees at its poultry facility in Temperanceville, Virginia, have tested positive for coronavirus.
It said that 178 of those cases were discovered following facility-wide testing between 5 May and 7 May while the remaining 79 were tested by local health officials.
Tyson said the majority of those who tested positive had not showed any symptoms of the virus.
Some 1,282 people work at the plant.
Thai Union confirms Covid-19 case at Portuguese plant
Seafood heavyweight Thai Union has confirmed a case of Covid-19 at the plant of its subsidiary European Seafood Investment (ESIP) in Portugal.
The company told The Stock Exchange of Thailand, on which it is listed, that the member of staff had reported feeling unwell on 20 May and immediately reported to the on-site infirmary and was sent home. On Saturday (23 May), a test was performed with positive results.
The employee continues to self-isolate and is currently not displaying severe symptoms of Covid-19 or in any immediate danger, Thai Union said.
As a precautionary measure, it has sent home approximately 200 out of the total 850 workers at the plant. These workers were identified as being in contact with the sick employee.
Peniche-based ESIP remains open and is working closely with all local health and government authorities on measures to ensure no further spread of Covid-19 among the workforce, Thai Union said.
The Thai company owns 100% of ESIP, a manufacturer and exporter of canned sardines and mackerel.
Brazil’s JBS ‘facing new legal challenge’ over Covid-19 outbreak
JBS, the Brazilian meatpacking behemoth, is said to be facing a second legal challenge linked to the outbreak of Covid-19 in one of its facilities.
According to a report from news agency Reuters, Brazilian labour prosecutors are suing the company “seeking damages and better work conditions” after an outbreak of the virus at a meat plant in Ipumirim, in the southern state of Santa Catarina.
JBS said in a statement sent to Reuters that it had not received formal notice of the lawsuit and said that it adhered to “strict protocols” against the virus.
In April labour prosecutors field suit after an outbreak of Covid-19 at the company’s Passo Fundo unit. Operations at that facility resumed on 21 May after being closed for a month.
The Ipumirim plant was closed after a labour inspection on 18 May.
Dutch meat supplier Vion Food Group has seen output at one of its domestic sites halted – and all staff sent home for a fortnight’s quarantine – after dozens of workers tested positive for Covid-19.
BRF meatpacking plant in Brazil dealing with mass outbreak of Covid-19
Brazilian meat giant BRF is dealing with a large outbreak of the Covid-19 virus amongst its workforce in a domestic plant.
Nearly 340 workers at its Concórdia plant in Santa Catarina state have tested positive for the virus, some 6.6% of the total workforce there of 5,132.
A statement from BRF sent to just-food said the workers have been suspended from duty after being diagnosed.
The company said it has tested all of the workers at the facility, which processes poultry and pork, in recent days with the 93% of workers who tested negative returning to work yesterday (25 May).
All BRF plants in Brazil remain open.
Danish Crown re-opens slaughterhouse
In Denmark, meat-processing cooperative Danish Crown has re-started output at a slaughterhouse where operations were halted last week.
The co-op stopped output at its slaughterhouse the southern Danish town of Skærbæk last Monday (18 May) after an outbreak of Covid-19 among staff at one of the site’s customers.
Westcrown, a German venture between Danish Crown and the German meat processor Westfleisch, was a major customer for the facility.
Danish Crown confirmed yesterday operations at the Skærbæk site had resumed.
Brazil’s JBS resumes operations at Passo Fundo plant
Brazilian meat giant JBS has reportedly reopened a poultry plant in the state of Rio Grande do Sul that was shutdown by authorities in April because of Covid-19 infections.
Slaughtering at the Passo Fundo site resumed on Wednesday (20 May), JBS said in a statement provided to Reuters, adding that the facility has the capacity to process 320,000 birds a day.
just-food has asked JBS for confirmation.
China is reportedly drawing up plans to secure the supply of food in the midst of the global coronavirus crisis, including strengthening mechanisms against diseases such as African swine fever, which has decimated the country’s hog herds.
G.Willi Food has ‘record’ quarter
G. Willi-Food, the Israel-based kosher food supplier, said it posted its highest-ever sales and operating profit in its fiscal first quarter due to increased demand amid the coronavirus outbreak.
Zwi Williger and Joseph Williger, who both hold the joint chairman role, said: “Since a strain of coronavirus surfaced in China at the end of 2019 and reached many other countries worldwide, including Israel, there has been a substantial increase in demand for the company’s products, especially in the retail market.
“The company acted to maintain its operational ability and to ensure that sufficient levels of inventory were available in order to meet demand during the Covid-19 pandemic. We intend to continue to maintain sufficient inventory levels and work to further strengthen the company’s supply chain, and product portfolio to meet its future demand.”
Sales rose 32% to ILS129.1m (US$36.5m), while operating profit climbed 50.9% to ILS19m. However, net profit slumped. It was down 92.5% at ILS1.2m.
UK meat-free start-up remains optimistic about foodservice
In an interview with just-food, Plant Meat, the UK-based meat-alternatives firm trading as (and under the flagship brand of) This speaks of how it has lost a third of its business amid the near-shutdown of the country’s foodservice channel but insists it is still “excited” about its prospects in that side of the market.
This (yes, that is the business’ and brand’s name) is one of a flurry of businesses looking to ride rising consumer interest in plant-based fare. The London-based company, which offers alternatives to chicken and bacon, has listings with UK grocers The Co-op and Waitrose and has more national retailers set to stocking its products this year.
Speaking to Dean Best, This co-founder Andy Shovel said the firm’s sales through UK supermarkets doubled in February and March but, of course, saw its foodservice business tumble. “Obviously that’s taken such a big knock but on the other hand, retail spiked a lot, so in a strange way we’re actually back where we started,” Shovel says.
“Generally speaking, I’d say the foodservice pipeline is the most exciting part of our outlook when this thing clears. We had more foodservice inquiries than we could deal with almost. That’s the area of business I find really exciting as well because it sets us apart to some degree. We made more traction in foodservice in six months than I think most of the category did to be honest. There aren’t that many meat-alternative brands who are co-branding in restaurants like we are.”
You can read the full interview, in which Shovel also discusses adapting to the Covid-19 pandemic and the growing competition in UK meat-free, here.
Food and beverage sector M&A activity in the UK in the first four months of this year is down drastically on the same period last year with Covid-19 having a “significant impact” on the deals market.
Data compiled by London-based advisory firm Oghma Partners reveals deal volume is down 40% year-on-year while deal value is down a massive 90%.
Tyson Foods has revealed more than 500 workers tested positive for Covid-19 at its poultry plant in Wilkesboro, North Carolina.
The US-based meat giant said the positive cases emerged from a facility-wide testing of 2,244 staff at the site, with 570 giving a confirmed diagnosis. The majority showed no coronavirus symptoms, the company said.
Kraft Heinz reports “handful” of cases at Kirksville
US food major Kraft Heinz has confirmed a “handful” of Covid-19 cases at its manufacturing plant in Kirksville, Missouri, with the infected staff now in quarantine at home on full pay.
The factory produces Oscar Mayer Bologna and Square Ham.
A statement provided to just-food read: “A handful of Kraft Heinz employees in our Kirksville, Missouri, factory have tested positive for coronavirus. We have taken all necessary steps to identify and notify individuals who worked closely with these employees.”
Hormel Foods withdraws financial guidance
Hormel Foods has withdrawn its annual guidance due to Covid-19 uncertainties, despite the US-based meat firm posting “record” second-quarter sales.
Chief executive Jim Snee said in a statement today (21 May): “The Covid-19 pandemic has created industry uncertainty as to whether we will experience further interruptions. Additionally, the foodservice industry is in the very early stages of a recovery, and we are actively monitoring the pace and magnitude of this recovery. As a result of this uncertainty, we are withdrawing our full-year sales and earnings guidance.”
Sales for the three months to 28 April rose 3% (6% in organic terms) to US$2.4bn. However, pretax earnings were down 10% at $286m, while net profit fell 8.7% to $277m.
Snee added: “Even though the Covid-19 pandemic has caused a dramatic shift in consumer behaviour, operational disruptions and extreme volatility in raw material markets, we remain financially strong and well-positioned to weather the pandemic.”
Dawn Meats said its beef patty plant in County Waterford, Ireland, which supplies fast-food chain McDonald’s across Europe, will reopen for business on Monday (25 May).
The family-owned company, which is active in the beef and lamb sectors supplying retail and foodservice channels, said the facility at Carrolls Cross has been idle since 18 March as McDonald’s outlets shut down under government orders to contain the spread of coronavirus.
It has been reported that a number of employees of UK meat processing firm Cranswick have died from Covid-19.
Global dairy market volatile and outlook uncertain, says Fonterra
New Zealand dairy giant Fonterra said Covid-19 has affected virtually every country, market and industry and, as a result, the global dairy market is “volatile and the outlook is uncertain”.
Miles Hurrell, CEO of the cooperative, the world’s largest dairy exporter, said Fonterra is drawing on its “global supply chain and diverse product and customer base to minimise disruptions for our customers and our business”.
In a trading update he said: “The work done over the last year to strengthen our balance sheet, and the co-op’s ability to respond quickly has helped us manage the Covid-19 situation over the last few months.”
He added: “As a New Zealand dairy co-op, exporting 95% of our products, many of the markets we do business in have always been prone to sudden shocks and this can impact where, when and what we sell. However, the global nature of Covid-19 is like nothing we’ve experienced before. Like other businesses, we will feel the impact of Covid-19 and its flow-on effects but how and to what extent is still uncertain. We are drawing on all our experience in managing market volatility.”
US food giant Kellogg has pulled an advertisement for its crisp brand Pringles from the popular ‘PE with Joe’ YouTube fitness broadcasts.
During the lockdown, UK-based fitness coach Joe Wicks has tailored much of the content on his YouTube channel The Body Coach TV at children to encourage them to stay active while off school.
The daily live videos, broadcast under the ‘PE with Joe’ banner, started on 23 March and have attracted families around the world.
The campaign group Action on Sugar and Salt accused Kellogg of “irresponsibly advertising” the snack and suggested it had dropped the ad, which appeared in April, “rather than face a formal regulatory investigation into its online advertising practices”.
However, Kellogg said airing the ad on the channel had been a genuine mistake.
JBS ‘to ramp up production’ at Canada plant hit by Covid-19 outbreak
Brazilian meat giant JBS is to increase production at its plant at Brooks, in the Canadian province of Alberta, local broadcaster CBC has reported.
It said JBS had scaled down to one shift but had not closed the plant after an outbreak of coronavirus amongst its employees. It will increase its production from one shift to two from today (21 May).
CBC reported that more than 600 workers contracted Covid-19 at the facility and one employee died during the outbreak.
It quoted locally-based JBS spokesman Rob Meijer as saying that moving from one shift back to two will not increase the number of people in the plant at any single time.
“The health and safety of our team members is our top priority. We have been working closely with public health and labour officials each and every day to implement rigorous risk mitigation practices throughout our facility,” he told the broadcaster.
Germany’s Westfleisch ‘restarting work’ at shuttered plant
German meat processor Westfleisch is resuming production at its plant in Coesfeld which was closed earlier this month after an outbreak of coronavirus, according to new agency Reuters.
It reported that Westfleisch said on Wednesday (20 May) that German authorities monitored a test slaughtering of 1,500 pigs at its Coesfeld facility and approved its working processes and corona hygiene precautions.
From tomorrow (22 May), the company will utilise about 30% of its normal slaughtering capacity of about 9,000 pigs daily and will increase capacity usage in stages.
The cabinet of German Chancellor Angela Merkel today (20 May) announced a “work protection programme for the meat industry”, raising labour standards in a sector criticised for poor health and safety due to a rash of outbreaks of Covid-19 among temporary migrant workers.
Canadian frozen potato products giant McCain Foods has suspended plans to expand a US plant because of a drop-off in demand from the foodservice channel during the coronavirus crisis.
Bristol Seafood pauses production in Maine
Bristol Seafood said it paused production at its processing plant in the US state of Maine on Monday (18 May) after the processor found confirmed cases of Covid-19.
The Portland Fish Pier facility is due to reopen during the week after cleaning and “universal testing” for employees, according to its president and chief executive Peter Handy. The number of infections were not disclosed.
Bristol Seafood said that since March, the company “has operated with modified procedures to meaningfully reduce the risk of its team members contracting Covid-19”, and had taken all the necessary health and safety protocols.
Greencore, the Ireland-based manufacturer that is one of the largest private-label suppliers in the UK, has seen its sales drop by around 40% in recent weeks amid a coronavirus-linked slump in demand for food-to-go products.
To protect its profits, Greencore has temporarily ceased production at three factories – in Bow, Atherstone and Heathrow – and rationalised production at its facility in Northampton.
Three Covid-19 clusters have been confirmed at slaughterhouses in France, local government officials have confirmed.
As of today (19 May), 132 staff had been officially confirmed as testing positive and one slaughterhouse, Tradival, owned by farming cooperative Groupe Sicarev, had been shut down by local authorities.
Sanderson Farms, the third-largest poultry group in the US, has revealed its orders through the foodservice channel are at two-thirds the level seen before Covid-19 hit that part of its business.
Sales to foodservice customers are the mainstay of Sanderson Farms, the number three poultry processor in the US by sales, behind only Tyson Foods and Pilgrim’s Pride.
The European Commission (EC) has sent a letter of formal notice to Bulgaria to make the country’s government reverse its guidance to local supermarket groups to prioritise local food products during the coronavirus crisis.
Brazilian meat giant JBS is reportedly planning to take legal measures to reverse an order to shutter one of its domestic plants to stop the spread of coronavirus.
Meanwhile, an eighth worker at the company’s plant in Greeley, Colorado, in the US has reportedly died from Covid-19.
BRF, the Brazil-based supplier of meat products and prepared foods, has re-opened a factory closed amid concerns over Covid-19.
The company, which owns brands including Seara and Qualy, said operations at the plant, located in the southern Brazilian city of Lajeado, had resumed after a local court ratified an agreement between the business and state health officials.
Danish Crown, the Denmark-based meat cooperative, has stopped output at a slaughterhouse after an outbreak of Covid-19 among staff at one of the site’s customers.
A Melbourne abbatoir has seen an outbreak of 98 positive Covid-19 cases, according to reports.
Australian broadcaster ABC said on Saturday (16 May) that the outbreak at Cedar Meats Australia’s facility included two new cases, despite the country starting to ease itself out of lockdown.
Poultry group Astral Foods delays capex
Amid South Africa’s lockdown, poultry processor Astral Foods has announced a delay in capital expenditure to expand production volumes.
Daan Ferreira, Astral’s CFO, said: “The group’s major capital programme to expand poultry volumes has been delayed, due to final commissioning not being completed as a result of the lockdown. Other capital expenditure has been slowed down due to the impact of the current lockdown.”
The disclosure came alongside Astral’s half-year financial results, which covered the six months to 31 March. Revenue increased by 4.3% to ZAR7.1bn (US$384.8m). Operating profit rose 8.5% to ZAR546m.
CEO Chris Schutte said: “The results for this reporting period were satisfactory and not impacted by the lockdown that was implemented towards the end of March 2020.”
The Astral board has agreed no interim dividend “would be declared under the present economic circumstances, whilst also considering the extreme uncertainty of the near future created by the seemingly indefinite Covid-19 lockdown”, Astral said in a statement.
“The impact of Covid-19 and the protracted lockdown on the welfare of South African citizens and the economy is dire. The unprecedented higher unemployment rate following the hard lockdown, further constraints on consumer disposable income, and financial distress on businesses with a slow recovery expected by most economists, makes for a negative outlook.
“The shutdown of quick service restaurants has exposed Astral to late payments from customers in this market, and due to a lack of supply into this sector under the current lockdown, a product mix change has resulted with a shift to lower margin product lines.”
Johnsonville, the US sausage maker, has temporarily closed its plant in Hilton, Kansas, after a Covid-19 outbreak there.
Some five employees tested positive for coronavirus.
Stilton cheese sales well down as Covid-19 bites
Sales of UK cheese variety Stilton have dropped by as much as 30% during the coronavirus crisis.
The Stilton Cheese Makers Association (SCMA), which represents the UK’s Stilton producers, said the drop off in demand is a result of the closure of the country’s hospitality and events industry and farmers’ markets. It has also seen export sales shrink.
It said this drop in sales is also having an impact on British dairy farms. The Stilton cheesemakers use milk from at least 70 farms across Leicestershire, Nottinghamshire and Derbyshire in the English Midlands, many of which are fifth generation dairy farmers.
The trade body is urging UK consumers to buy Stilton and other British cheeses to support the industry and prevent producers going out of business.
An analysis piece on the site this afternoon, covering the appearance of General Mills president and CEO Jeff Harmening – down a web cam – at BMO Capital Markets’ annual Farm to Market Conference, which, for obvious reasons, was held virtually this year.
General Mills this week lifted its forecasts on a couple of key sales and profit metrics after seeing US pantry-loading boost demand. On Wednesday (13 May), Harmening outlined to investors what the soup-to-yogurt maker was seeing in its domestic market and discussed a range of issues, from the revival of big brands and the slump in foodservice to China’s early recovery and the company’s thoughts on M&A. In this piece, Dean Best presents the top takeaways.
US baker Flowers Foods reveals Covid-19 sales surge
Flowers Foods, the US bakery business behind brands such as Nature’s Own, Wonder and Dave’s Killer Bread, has seen its sales boosted by consumers stocking up on bread during the Covid-19 crisis.
Following the release of its Q1, 2020 results, which revealed net sales of US$1.34bn – an increase of 6.8% year-on-year – company CEO Ryals McMullian told analysts “the current situation is certainly unlike anything we’ve ever seen”.
He said that during the peak of demand in March its weekly branded retail sales growth exceeded 70% versus the prior year.
“One major retailer reported that more than two million households tried our brands for the first time during the quarter. That’s just one retailer,” he said.
In his latest column for just-food, US industry veteran Victor Martino discussed how Big Food’s legacy brands are having their day in the sun in the US, boosted by pantry-loading.
“The big question,” Victor wrote, “and everybody in the industry is speculating about it is whether the outsized sales gains legacy brands have been experiencing over the last few months are merely a by-product of consumer stockpiling or if the sales surge is signalling a renewed era for big CPG brands. Are big CPG brands back?
“Linked to that,” he continued, “is another question: does the current resurgence of legacy brands mean the emerging brands’ insurgency against legacy brands over the last 20 years is coming to an end or, at least, is in the process of becoming greatly diminished?”
In his column, Victor argues challenger brands can still – and will – compete with their newly-revived Big Food legacy-brand competitors.
And here in the UK this afternoon, London-based Young Foodies, which operates as a network and a consultancy for around 1,100 food and drink SMEs, argued small and medium-sized enterprises (SMEs) in the food and drink sectors will emerge from the Covid-19 crisis well-prepared to prosper.
Theadora Alexander, co-founder of Young Foodies said although the current picture is “highly fragmented” and some smaller brands have lost self space as retailers have sought to keep the shops stocked with everyday items, she believes the future is rosy.
“The good news for smaller brands is that consumer ethics and values feel stronger than ever and they are looking to support independent businesses and small traders,” she told the FUTR Live webcast today (14 May). “There is a huge opportunity for SMEs because they are more nimble and can move more quickly than their larger counterparts.”
Bidcorp’s Asia foodservice business, Angliss Asia, has described a new online business-to-consumer platform in China as a key growth area for the company.
Speaking as part of hospitality network Arena’s webinar series, Angliss Asia CEO Johnny Kang said the platform was developed in response to consumer trends under Covid-19 lockdown. However, as China comes out of quarantine, Kang said the company’s B2C operations form “one of our future growth areas”.
Moy Park, the Northern Ireland-based poultry processor, has confirmed the death of an employee from Covid-19 at its plant in County Tyrone.
The member of staff worked at the company’s facility on Killington Road, Dungannon.
A spokesperson for Moy Park, which is owned by US-based poultry firm Pilgrim’s Pride, said: “We are deeply saddened to learn of the death of one of our team members. The terrible impact of the coronavirus pandemic continues to greatly affect everyone’s daily lives throughout our community.
“As we have consistently stated, the health, wellbeing and safety of our Moy Park team members is always our most important consideration.”
Canada’s Premium Brands Holdings, the acquisitive food manufacturer that has built its business on M&A, has its eyes on securing at least another 20 deals.
However, any further closing of pipeline transactions, with five in the “advanced” stage, have been suspended for the time being due to Covid-19, according to a slide presentation at Premium Brands’ annual general meeting.
A court in Rio Grande do Sul has ordered BRF, the Brazil-based meat and prepared foods giant, to close one of its factories in a bid to tackle the spread of Covid-19 in the country’s southernmost state.
US meat giant Tyson Foods has said 51 employees at its poultry plant in Portland, Maine, have tested positive for coronavirus.
The plant has now re-opened after being closed for deep cleaning.
All three of Hormel Foods’ Jennie-O Turkey Stores have now reopened
Hormel Foods said all three of its Jennie-O Turkey Store plants in Minnesota have now reopened, with the Willmar Avenue facility the latest to recommence operations.
Last week, the US-based meat business said its Benson Avenue and Melrose factories, both in Minnesota, had restarted following a voluntary pause due to Covid-19 infections.
As with the Benson Avenue and Melrose manufacturing facilities, Hormel said late yesterday (12 May) that operations at Willmar Avenue have restarted with a “core group of team members”, with production to be increased “over the coming days”.
Butterball confirms employee death
Butterball, the US turkey processor, has confirmed one of its staff working at Mount Olive facility in North Carolina, where an unconfirmed number of staff have tested positive for Covid-19, has passed away.
“We can confirm that we were informed on May 7 of the sudden passing of a valued team member from our Mount Olive plant, but have not been informed of the specific cause. We respect the family’s privacy during this difficult time and extend our deepest sympathies,” a Butterball spokesperson said.
Two weeks ago, local media reports suggested almost 60 staff at the facility had come down with the virus but neither Butterball or officials within the local Duplin County have confirmed numbers.
The Butterball spokesperson added yesterday: “Because this has been a fluid situation, and some individuals have recovered and returned to work, we do not feel a total number is an accurate representation of what is happening on the ground. The plant remains open and operational, and we continue to work closely with the Duplin County Health Department to help us manage any Covid-19 cases.”
Cargill ‘registers six Covid-19 cases at Brazil plant’
US agri-food giant Cargill has reportedly seen six of its workers at a plant in Brazil test positive for coronavirus.
According to a statement from Cargill, quoted by news agency Reuters, most of the employees diagnosed with the respiratory disease at its plant in Uberlândia in south east Brazil have already returned to work after receiving medical attention.
Cargill, which processes soybean and corn at the site, said that, thus far, it has had no interruptions in Brazilian operations due to the Covid-19 outbreak.
The Uberlândia facility employs between 1,300 and 1,400 people.
Ireland has seen the number of positive Covid-19 cases within its meat processing plants top 500.
Answering a request from just-food, the Irish Department of Health said as of today (13 May) there have been 12 Covid-19 “clusters” in meat processing plants notified to public health officials.
UK meat industry body BMPA warns of price hikes
The British Meat Processors Association (BMPA) is warning that food prices may have to increase because of “spiralling freight costs” during the current Covid-19 crisis.
In a statement issued today, it said there is evidence of a doubling and in some cases nearly tripling of maritime freight costs over the last month from exporters across the food supply chain.
“The current price hikes which have persisted from early March are starting to look like opportunistic exploitation by a small group of large global companies which control that market,” it said.
“As early as mid-March, reports were coming in that the congestion in Chinese ports had eased, with terminal operations returning to more normal working conditions. Indeed Shanghai, the world’s largest container port by volume had expanded its capacity for handling and storage of refrigerated containers by 40%.
“As exporters of food supplies, we’re not asking for special treatment from shippers, but we are asking them to strike an equitable balance on pricing and not exploit an already dire situation.”
US meat heavyweight Pilgrim’s Pride is said to be facing worker complaints at a Minnesota poultry processing plant linked to an outbreak of Covid-19.
Germany’s Westfleisch closes plant hit by Covid-19
Westfleisch, one of Germany’s largest meat processors, has closed its plant at Coesfield, near the western German city of Munster, following a Covid-19 outbreak amongst its workforce.
According to multiple media outlets in Germany, the company has shuttered the plant until further notice, in line with German government emergency lockdown regulations, after scores of employees tested were positive for Covid-19. Reports vary, with the highest figure quoted suggesting 196 workers have become infected with the virus. All agree that the number is above 150.
The company told local news outlets that 13 people have been hospitalised with moderate symptoms, and the rest are isolating with mild symptoms.
‘Covid-19 outbreak at Saputo plant’ in Canada
Canadian dairy business Saputo is dealing with an outbreak of Covid-19 at its Saskatoon milk plant, according to broadcaster CBC.
It reported that the Saskatchewan Health Authority has revealed that one worker at the plant tested positive for the virus while other employees are self-isolating.
Around 250 people work at the facility.
CBC quoted Saputo spokesperson Sandy Vassiadis as saying the infected employee’s last shift was on 27 April.
Everyone considered to have come into direct contact with the infected employee has been instructed to self-isolate and monitor themselves for symptoms of the virus, she said.
Operations at the plant are continuing.
US food and beverage giant PepsiCo has launched two direct-to-consumer websites to meet consumer demand during the coronavirus pandemic.
The Frito Lay crisp brand owner has launched PantryShop.com and Snacks.com, on which US-based shoppers can order an assortment of PepsiCo’s food and beverage products.
On PantryShop.com, consumers can order bundles containing PepsiCo’s brands such as Quaker, Gatorade, SunChips and Tropicana.
US giant General Mills said today (11 May) it expects to beat its forecasts for full-year organic sales and underlying operating profit after experiencing an “unprecedented increase in consumer demand for food at home”.
The US agri-food giant will later this week shut a meat-processing facility in Canada, the second time the company has closed a factory in the country.
According to media reports in Canada, the plant in Chambly in Quebec will shut down on Wednesday after an outbreak of Covid-19 among staff. Some 64 employees have the virus.
Last Monday, Cargill reopened a meat plant in the Canadian state of Alberta that was closed down temporarily amid reports hundreds of workers had contracted coronavirus.
Premium Brands Holdings pulls guidance
Premium Brands Holdings, the Canadian food producer, has pulled its annual guidance due to the “ramifications” of the Covid-19 pandemic.
The Vancouver-based business, with a portfolio stretching across cured meats, snacks and seafood, made the announcement with its first-quarter results to 28 March. Revenue was up 20.4% at CAD935m (US$668.2m); organic sales volumes increased 14.6%; adjusted EBITDA climbed 6.6% to CAD64.3m; and net earnings rose 22% to CAD12.2m.
“The market ramifications of the Covid-19 pandemic had a slightly positive impact on the company’s sales and adjusted EBITDA in the first quarter, however, it expects the pandemic to have a significantly negative impact on its results for the year, in general, and the second quarter, in particular,” Premium Brands said in the earnings release.
Indiana Packers resumes pork production at Delphi facility
US-based pork supplier Indiana Packers (IPC) has resumed resumed limited operations at its facility in Delphi, after it was shut down last month due to 15 workers coming down with Covid-19.
IPC, which owns the Indiana Kitchen brand, has worked with the Indiana State Department of Health and Carroll County Department of Health to complete Covid-19 testing of 2,267 employees and contractors working at the facility on 1 May.
IPC president and CEO Russ Yearwood said: “This pause in operations and the testing of our employees was absolutely a critical moment in our ongoing effort to create a safe work environment.”
He added: “We suspected the testing process would generate an increase in positive cases unknown to us, but this was the point. This voluntary testing event identified those who are positive for the virus.”
IPC has carried out deep cleaning and plant-wide sanitisation at the facility. It has also added more physical barriers and hand sanitiser dispensers.
Canadian meat supplier Sofina Foods reports Covid-19 cases
Meanwhile, another meat processor, Sofina Foods, has announced cases of Covid-19 at two of its plants.
Sofina said two of its plants in Ontario had each seen one member of staff contract the virus. The factories are in Mississauga and Burlington.
In a statement on Friday, the company said the workers “are doing well and are self-isolating at home”.
A Sofina spokesperson said the company “stopped operations overnight” at the Mississauga plant “to allow fogging of all welfare areas in addition to daily sanitation”.
The spokesperson added: “In the case of our Burlington plant, the employee had not been at work for a week. Given the sanitation protocols in place at the plant, including regular fogging, we are confident that the areas where the employee went do not pose any contamination concerns.”
Last month, Sofina announced one of its employees at its plant in British Columbia had tested positive for Covid-19.
Canada poultry processor Maple Lodge Farms confirms Covid-19 fatality
Maple Lodge Farms, one of Canada’s largest poultry processors, has announced the death of an employee who tested positive for Covid-19 last month.
“We have been in touch with their family to offer our deepest condolences. We are also dedicated to providing the support and reassurance to help our employees through this incredibly difficult time,” a statement dated 7 May and posted on the Maple Lodge Farms reads.
“At the time of this notice, 25 employees have tested positive for Covid-19. We have checked in frequently with these employees to see how they are doing and offer our support.”
The statement listed measures Maple Lodge Farms said it had implemented to protect staff, including the suspension of “one-third of our operations” to clean its facility in Ontario and to implement “a plan to increase physical distancing of common areas”.
US group Hormel re-opens two factories
Hormel Foods, the US food manufacturer, has re-opened two plants in Minnesota closed in recent weeks due to COvid-19.
The company said on Thursday (7 May) operations at its Benson Avenue facility in Willmar in Minnesota had resumed “with a core group of team members and plans to ramp up production over the next few days”.
On 24 April, Hormel announced it would halt operations at the site, as well as at another on Willmar Avenue in Willmar. Both are part of Hormel’s Jennie-O Turkey Store business.
Steve Lykken, president of Jennie-O Turkey Store, said on Thursday: “We are glad to be reopening this facility and are working on our plans for reopening our other facilities including another location in Willmar and in Melrose, both in Minnesota. We have put the safety of our staff first throughout this pandemic and will continue to do so.”
Meanwhile, on Friday, Hormel’s Alma Foods subsidiary started on what it called a “phased reopening plan”.
Alma Foods had decided to close “due to the small size of the plant and staffing availability due to some community issues with Covid-19”.
How could Covid-19 change the global food system?
What could be the possible lasting effects of the Covid-19 pandemic on consumer attitudes to food and, more broadly, on the global food system?
In a deep dive published today (7 May) – featuring companies including Mondelez International and General Mills, as well as stakeholders across the financial and NGO communities – our contributing editor Ben Cooper discussed what are pretty big questions but questions many are pondering as we try to look beyond Covid-19.
Consumption patterns and consumer attitudes to food have been disrupted by the Covid-19 crisis, and the food market could be reshaped permanently by the pandemic.
The crisis has brought home how food is far more than just another aspect of people’s lives that could be changed by the virus. Even though the fear of food scarcity was relatively fleeting for many in developed countries, it has been enough to alter how people think about and value food, with possibly positive implications for efforts to reduce food waste, improve diets and create more sustainable food supply chains.
Meanwhile, the resilience of current modes of food production and distribution to such disruption is being assessed, with increased localisation and regionalisation finding favour with food manufacturers and consumers alike.
Change will not be sudden, however, as coping with continuing upheaval and a deep recession will be the main priorities during an indeterminate period of stabilisation and recovery. It is only when that phase is over that the lasting effects of Covid-19 on food culture can be fully judged.
You can read Ben’s piece – How could Covid-19 change how we think about food? – in full here.
Iglo and Birds Eye owner Nomad Foods today (7 May) lifted its forecasts for annual sales and profitability after strong top-line growth in the first quarter of 2020.
Stéfan Descheemaeker, Nomad Foods’ CEO, said the company had seen an “unprecedented level of consumer demand for frozen food, driven by the Covid-19 pandemic”.
He added: “This change in consumer behaviour, which began in early March, has continued into the second quarter with in-home consumption the most meaningful driver.”
UK private-label major Bakkavor has confirmed that four of its workers have contracted the Covid-19 virus.
US meat heavyweight Smithfield Foods has confirmed that its pork processing facility in Sioux Falls, South Dakota, will re-open today (7 May).
2 Sisters Food Group, the UK-based poultry processor, has confirmed infections of Covid-19 among a number of employees at its plant in Devon, south-west England.
Our correspondent in Moscow, Lena Smirnova, reports on some of the challenges facing food manufacturers operating in the country.
The Covid-19 pandemic, which is yet to hit its peak in Russia, has put increasing pressure on the country’s food manufacturers by increasing operational costs at a time when businesses have also been facing a decline in the value of the rouble.
Major food manufacturers continue to operate at or near full capacity despite amid a nationwide lockdown, which is set to expire on 11 May.
Food manufacturers have been exempted from the order but health and safety costs have risen, A bigger pressure on food manufacturers comes from Russia’s weakened ruble, which has fallen steeply during the crisis.
You can read the story here.
Tyson Foods, the US meat major and one of the world’s largest, believes the industry will likely quicken its efforts to increase the use of automation in production facilities.
US-based Triumph Foods has seen a mass outbreak of positive Covid-19 cases amongst the workforce at its pork processing plant in St Joseph, Missouri.
US meat giant Tyson Foods is to resume operations at its Waterloo, Iowa, facility – its largest pork processing plant.
In an announcement, Tyson said the plant will re-open following a “comprehensive review” of safety protocols.
Meanwhile, Tyson has also reopened a meat plant in Washington where production was suspended two weeks ago to enable testing of staff for Covid-19.
The beef facility in the city of Pasco run by the Tyson Fresh Meats division resumed “limited production” yesterday (5 May) having been idled on 23 April, according to a statement from the Arkansas-headquartered firm.
Staff who had contracted the virus will only be able to return to work once cleared by health officials, and team members who have not been tested will not be able to return, Tyson said. New health and safety protocols have also been put in place following deep cleaning and sanitisation of the plant.
Premier Foods pushes back annual results to June
Premier Foods, the UK-based owner of Batchelors soups and Mr Kipling cakes, has delayed the publication of its preliminary annual results until June.
The company was scheduled to issue numbers for the year to 28 March on 14 May, but to ensure Premier and its auditors have “sufficient time to complete the standard full-year reporting requirements”, they will now be published by the end of June, with a more precise date to be confirmed, it said in a filing with the London Stock Exchange today (6 May).
Premier said its previously announced guidance remains unchanged. Fourth-quarter sales are expected to be up 3.6%, with trading profit at the “top end of market expectations”.
Snacking heavyweight Mondelez International has paused production at its West Hamilton plant in Canada after four employees came down with coronavirus.
US food major Conagra Brands said it intends to resume operations at the factory in Darien, Wisconsin, later this week.
Meal-kit maker HelloFresh sees Covid-19 boost
HelloFresh, the Germany-based meal-kit supplier, today (5 May) lifted its forecast for annual sales growth after bumper sales in the first quarter.
The company now expects its revenue to climb by 40-55% on a constant-currency basis in 2020, up from its previous forecast of 22-27%. The business also lifted its forecast on a metric for adjusted margins.
“On top of our already very strong first two months of the year, our meals have attracted significant additional demand in the second half of March, as the global pandemic hit all of our markets in short order,” HelloFresh co-founder and CEO Dominik Richter said.
In the first quarter of 2020, HelloFresh said it had what it calls 4.18m “active customers”, up from 2.48m in the opening three months of 2019. It booked 14.74m orders, up from 8.88m a year earlier.
HelloFresh’s first-quarter revenue rose by more than 66% to EUR699.1m (US$760m).
Major US retailers place limits on buying meat
With the US meat supply chain being battered by Covid-19, a couple of major retailers have taken action.
Kroger has placed limits on certain branded and own-label meat products.
Meanwhile, at wholesaler Costco, “fresh meat purchases are temporarily limited to a total of three items per member among the beef, pork and poultry products”.
Last week, major processor Tyson Foods warned of US meat shortages because of the number of plants shut by the Covid-19 virus.
In statements posted in US media outlets including The New York Times, company chairman John Tyson said the “food supply chain is breaking” as livestock and processing plants are closed because of the virus’s spread among workers.
The number of Covid-19 cases at a Tyson Foods meat plant in Tennessee have reportedly increased dramatically.
Fox News, quoting Metro Health officials in Nashville and Davidson County, said 298 cases have been confirmed at the facility in Goodlettsville.
Late last month, other media reports, citing the same officials, reported there were around 90 cases at the meat giant’s plant in the city of Goodlettsville, which is located across the Davidson and Sumner counties in Tennessee.
Reports from the US say that meat giants JBS and Smithfield Foods are re-opening plants closed due to the Covid-19 outbreak.
The news follows an executive order from President Trump last week that said plants should stay open to ensure the US meat supply.
Hormel’s Don Miguel Foods re-opens
Don Miguel Foods, a US-based Mexican foods manufacturer, has re-opened as planned after a two-week shutdown prompted by a local Covid-19 outbreak.
“We have a common enemy, Covid-19, and we must work together to stop its spread both at the workplace and outside of work. We know what we need to do, it’s just a matter of everyone taking the steps necessary to keep each other safe,” Don Miguel Foods plant manager Ryan Gaynor said.
Don Miguel Foods is a subsidiary of MegaMex Foods, a joint venture between Mexico’s Herdez Del Fuerte and Hormel Foods.
Rochelle Foods, a US business owned by Hormel, also re-opened its facility in Illinois yesterday after testing workers for Covid-19 and introducing new safety measures at its plant.
Last week, Hormel subsidiary Fontanini Foods said it was to furlough, or temporarily lay off, 150 workers as Covid-19 takes its toll on the business.
Hormel, meanwhile, has closed another two facilities after a number of employees tested positive for Covid-19.
Tulip Ltd., the UK-based pork processor owned by US meat firm Pilgrim’s Pride, confirmed an undisclosed number of employees have tested positive for Covid-19 at “some” facilities, although the company declined to provide specific details on the plants concerned.
Seafood giant Thai Union nets more sales
Thai Union Group, the seafood titan behind brands including John West and Chicken of the Sea, said today (5 May) its first-quarter sales reached their highest level for three years.
Sales rose 5.9% to THB31.1bn (US$960.5m), driven by “a strong performance” from Thai Union’s ambient business.
“Consumers around the world stocked up on shelf-stable products in response to Covid-19,” Thai Union.
While sales from ambient products grew more than 16%, Thai Union did point to a 5.1% fall in sales from its “frozen, chilled seafood and related business”. The company said that was “largely due to the impact of Covid-19” on its hospitality business.
Greencore, the Ireland-based convenience foods manufacturer, said an employee at its Northampton plant in the UK has tested positive for Covid-19.
The worker is employed at the facility in the Moulton Park area of Northampton, which is located in the English east Midlands.
US meat titan Tyson Foods has warned of pressure on its sales volumes in the second half of its current financial year as gains made through selling to retailers have not offset a loss in business in a foodservice market largely shut down to tackle the Covid-19 outbreak.
Providing forward-looking commentary alongside the financial results for the six months to 28 March, Tyson said each of its divisions had seen a “shift in demand” from the foodservice channel to the retail market.
However, the Jimmy Dean and Hillshire Farm owner warned: “The volume increases in retail have not been sufficient to offset the losses in foodservice and as a result, we expect decreases in volumes in the second half of fiscal 2020.
Aryzta has provided an update on the actions the Swiss-Irish bakery business has taken during the coronavirus crisis, including a pause in production at certain plants in Europe and North America, and the suspension of new projects under its turnaround programme.
Hormel’s Rochelle Foods arm re-opens facility following employee testing
Rochelle Foods, the US business owned by Hormel Foods, has re-opened its facility in Illinois today after testing workers for Covid-19 and introducing new safety measures at its plant.
The company, which makes a variety of products for foodservice and retail customers, including microwaveable and pre-cooked bacon, foodservice and retail bacon, deli hams and Hormel Compleats microwaveable meals, closed its operation down for 14 days.
It said the vast majority of its employees had tested negative for the virus.
During the pause in operations it carried out a deeo cleaning of high-touch areas, reconfigured common areas and workstations, revised shift scheduling, introduced new guidelines on carpooling and brought in more extensive social distancing measures.
Bill Rice, Rochelle Foods plant manager said: “We have put the safety of our team members first throughout this pandemic and will continue to do so.”
Kellogg is pushing back the planned launch of plant-based brand Incogmeato due to the Covid-19 outbreak.
Ireland-based pork supplier Rosderra Irish Meats Group has seen dozens of staff test positive for the novel coronavirus, according to a senior member of the Irish parliament.
Ireland has “six clusters” of Covid-19 in meat factories, the country’s Agriculture Minister has said.
Michael Creed, Ireland’s Minister for Agriculture, Food and the Marine, revealed the number of groups of cases in the country’s parliament, the Dáil, on Thursday (30 April). He did not disclose their location.
US meat giant Tyson Foods has announced that it is to re-open its Logansport, Indiana, plant next week despite local media reports suggesting nearly 900 workers there have contracted the Covid-19 virus.
Pilgrim’s Pride believes investment in automation in its plants has helped the US poultry heavyweight avoid the worst of Covid-19.
Media outlets in the US suggest that local meat giant Tyson Foods has seen nearly 900 workers at one of its plants test positive for Covid-19.
Kraft Heinz’s first-quarter results issued this week unsurprisingly reflected the artificial demand from Covid-19, a facet that’s unlikely to be sustained beyond the current crisis. Simon Harvey looks at the key takeaways as markets seek evidence the company’s “paradigm shift” is working.
Cases of Covid-19 at a US beef plant owned by Brazilian meat giant JBS have reportedly surged since the facility was reopened a week ago.
The Meatless Farm Co., a UK-based alternative-protein start-up, has launched a direct-to-consumer service ahead of schedule to cater to the increased demand from coronavirus.
Tyson Foods is reportedly set to halt operations at the US meat giant’s beef plant in Dakota City, Nebraska, to undertake deep cleaning in the midst of the coronavirus outbreak.
Cargill is to reopen a meat plant in the Canadian state of Alberta next week that was closed down temporarily amid reports hundreds of workers had contracted coronavirus.
The US-based agri-food business said the High River facility will resume operations on Monday, 4 May, after being idle for 14 days, following consultations with Alberta Health Services (AHS) and Occupational, Health and Safety (OHS).
Northern Ireland’s agri-food industry could face 10,000 job losses as a result of the Covid-19 pandemic, a senior politician in the province has warned.
Potential meat shortages in the US caused by the closure of processing plants due to Covid-19 could usher in marked changes in the country’s eating habits, according to UK-headquartered data and analytics firm GlobalData.
Canada’s Sofina Foods reports case at Port Coquitlam plant
Sofina Foods, a Canada-based branded and private-label meat supplier, said one of its employees has tested positive for Covid-19 at its plant in British Columbia.
The privately-owned business, which is headquartered in Markham, Ontario, said today (30 April) the site in question is located at Port Coquitlam, near Vancouver.
Kuljeet Chahal, the plant’s manager, said: “The employee lives with relatives who work at a local plant where, recently, several employees tested positive for the virus, including one of the employee’s relatives. We have been preparing for this type of incident and quickly sprang into action to assess risks and identify any action needed in addition to the proactive measures we already have in place.”
Port Coquitlam produces fresh chicken products and employs more than 400 people, Sofina said.
Ireland-based Kerry Group has pulled its financial guidance due to the implications of coronavirus, which boosted the Richmond sausages owner’s retail sales in the first quarter as more people ate at home, but hit foodservice operations.
Butterball, the US turkey processor, has seen an outbreak of positive Covid-19 cases amongst the workforce at one of its plants.
Local media reports suggest nearly 60 workers at the Mount Olive facility in North Carolina, where Butterball is based, have come down with the virus.
JBS to re-open Minnesota pork plant for slaughtering operation
Brazilian meat heavyweight JBS is to re-open a US plant closed because of a Covid-19 outbreak, according to reports.
News agency Reuters reports that the company’s Worthington, Minnesota, plant is to re-open but to kill up to 13,000 pigs a day for farmers, not to produce meat for consumers.
US farmers have been forced to cull livestock after meat plants where they would normally be sent closed to combat the spread of coronavirus.
Reuters quoted JBS as saying it will need only ten to 20 employees of the 2,000 workers at its Worthington plant to manage the “humane euthanasia” of pigs.
The plant stopped operations on April 20. Until then it processed 20,000 hogs per day.
We’ve seen some radical changes in the way people shop over the past couple of months in light of the coronavirus pandemic. But how might that influence the manufacturer’s approach to direct-to-consumer services? Simon Harvey looks at the life for D2C post-crisis.
Covid-19 outbreak amongst Romanian workers in German meat plant, government says
Around 200 Romanians working at an unnamed German slaughterhouse have tested positive for the coronavirus, Romania’s foreign ministry (MFA) has said.
According to the ministry, those infected had all been working at a slaughterhouse in the south western German town of Birkenfeld, where 500 of the 700 employees are Romanian.
“German authorities say 300 employees are confirmed with Covid-19 and are now in quarantine. So far there is no precise data regarding the citizenship of those infected, but the majority (over 200) are Romanian citizens,” the ministry said in a statement.
US President Donald Trump has ordered the country’s meat processing plants to stay open during the coronavirus crisis.
He is signing an executive order to that effect against a backdrop of plant closures due to Covid-19 outbreaks and warnings about meat shortages in US supermarkets as a result.
Mondelez International has retracted its financial outlook due to a lack of “visibility” into the impact of Covid-19 even as the US-based snacks maker reported a “strong” first quarter.
US food and beverages giant PepsiCo is to invest in products such as cereal brand Quaker that have benefited from people eating at home during the Covid-19 lockdown.
Fazer Group has warned of further coronavirus-related lay-offs as it prepares to start talks with employees at its confectionery plant in the Finnish city of Vantaa.
Meal-kit firm Blue Apron sees rise in demand during lockdown
Blue Apron, the New York-based meal-kit firm, has seen demand for its products increase during lockdown.
Delivering its Q1, 2020, results, the company said that since that quarter ended it has seen a significant increase in demand “following the various stay at-home and restaurant restriction orders and other restrictions on consumers that have been enacted throughout much of the country in response to the Covid-19 pandemic”.
CEO Linda Findley Kozlowski, said: “As we move into the second quarter of 2020, we are focused on driving customer retention and establishing longer-term consumer habits out of the heightened demand we have been seeing as a result of the impact of Covid-19.”
In order to meet the increased demand, the company is increasing capacity at its fulfilment centres, including hiring new employees and temporarily reducing variety in menu options, which limits the need to change production lines and allows for more time to pack meal kits.
PepsiCo has pulled its financial guidance for the year as the US-based food and beverages giant said the coronavirus crisis has thrown up too many uncertainties to accurately predict the outlook.
The Frito-Lay and Walkers crisps owner made the announcement in conjunction with its first-quarter results to 21 March, with revenue up but both operating and net profits down on a reported basis.
Bimbo signals China QSR recovery
Grupo Bimbo, the world’s largest bakery business, has indicated it is seeing signs of recovery in China’s quick-service-restaurant channel.
Reporting its first-quarter financial results yesterday (27 April), Bimbo’s management offered some flavour on developments in China’s QSR market.
“We’re seeing in China [it’s] starting to recover the QSR market, as well as Korea,” Bimbo CEO Daniel Servitje said. “We are hopeful that we will start to see a good trend over the coming quarters in terms of how they fast can get back to their previous levels. It’s not going to be certainly in Q2 or Q3, the same level as we had in Q1 but we are thinking that we are on the right track as we are starting to see the situation evolve country-by-country.”
Asked if Bimbo was seeing QSR restaurants were running at a reported 40% capacity in China, Servitje added: “Well, we have, I will say, a bit higher number than the one that you mentioned about – and we are seeing an upward trend every week since they restarted their economy.”
Foodservice accounts for around 10% of Bimbo’s sales, Servitje said. Four of the company’s factories supplying the QSR market are closed: one each in France, South Africa, Morocco and Kazakhstan. A plant in Wuhan Bimbo shut in February has re-opened, Servitje confirmed yesterday.
In the first quarter, overall Bimbo sales rose 7% to MXN74.4bn (US$3.05bn). Bimbo said its “adjusted” EBITDA was up 11% at MXN8.9bn. Net majority income fell back significantly – from MXN1.32bn a year ago to MXN20m – due to costs linked to pensions.
UK meat group Cranswick pushes back FY results
Cranswick, one of the UK’s largest meat processors, has delayed the publication of its annual financial figures, which were due to be unveiled next month.
“Following guidance from the Financial Conduct Authority and the Financial Reporting Council relating to the unprecedented challenges faced by companies and their auditors in preparing financial information and accounts during the Covid-19 pandemic, the group now expects to report its preliminary results for the year ended 31 March 2020 on 23 June 2020, instead of the previously announced date of 19 May 2020,” Cranswick said in a stock-exchange filing today.
“This new date has been agreed with the group’s auditors to also allow them additional time to carry out the necessary audit process in light of travel and social distancing restrictions.”
US-based Fontanini Foods, owned by local heavyweight Hormel Foods, is to furlough, or temporarily lay off, 150 workers as Covid-19 takes its toll on the business.
Confectionery maker Ferrero has closed parts of its chocolate plant in Ontario, Canada, after three employees contracted coronavirus.
The Italy-headquartered business said it shut “two departments” at the facility in the city of Brantford, which makes the Ferrero Rocher brand of treats, until 3 May. It added the affected employees had self-isolated for at least a week before being confirmed as having Covid-19.
Freshways have said the operations director of the UK-based dairy firm is now recovering in hospital after contracting coronavirus.
South Dakota governor speaks on closed Smithfield plant
Kristi Noem, South Dakota’s governor, has said Smithfield Foods’ closed pork-processing factory in the state’s city of Sioux Falls could be open “in a matter of days” pending work on some “mitigation measures”.
Smithfield announced the closure of the Sioux Falls factory on 12 April “until further notice” amid what were reported to be dozens of positive cases of Covid-19 among staff. The facility represents 4-5% of total pork production in the US. Reports subsequently claimed the plant had more than 500 Covid-19 cases.
Speaking to US broadcaster Fox News yesterday, Noem said she was hopeful the plant could soon re-open. “I’m hopeful that we can get it opened as soon as possible,” Noem said. “They have some mitigation measures to put in place, but I think in a matter of days it could be opened, as long as everybody continues to work together and get it done.”
Speaking to just-food yesterday, Keira Lombardo, Smithfield’s executive vice president of corporate Affairs and compliance, said the company was in the process of studying a report on the factory issued last week by the US Centers for Disease Control and Prevention. She added: “We will thoroughly and carefully examine the report point by point and respond in full once our assessment is complete.”
The food and beverage industries could see greater sales made through e-commerce in the wake of the Covid-19 pandemic, Nestlé CEO Mark Schneider has suggested.
During the first quarter, Nestlé saw e-commerce sales for its petcare and coffee businesses and, speaking to analysts after the world’s largest food maker posted its sales for the opening three months of the year, Schneider suggested the channel could grow in importance for the food and beverage markets.
“This is a key area where we saw true significant increases,” Schneider said of Nestlé’s Q1. “I think some of that will be here to stay. One of the side-effects of this crisis will be it will be a breakthrough event when it comes to e-commerce for food and beverage.
George Eustice, the UK’s Environment Secretary, has said he is in talks with industry to see if furloughed, or temporarily laid off, workers could help with picking fruit in June.
Tyson Foods chairman issues industry supply warning
US meat titan Tyson Foods has warned of US meat shortages because of the number of plants shut by the Covid-19 virus.
In statements posted in US media outlets including The New York Times, company chairman John Tyson said the “food supply chain is breaking” as livestock and processing plants are closed because of the virus’s spread among workers.
Tyson announced the closing of a number of pork and beef processing facilities last week in an attempt to contain the spread of the virus while other major meat processors in the US have done likewise.
“There will be limited supply of our products available in grocery stores until we are able to reopen our facilities that are currently closed,” Mr Tyson said.
Tyson Foods didn’t mince words in a full page @nytimes ad Sunday, warning, “the food supply chain is breaking.”
“As pork, beef and chicken plants are being forced to close…millions of pounds of meat will disappear from the supply chain,” John Tyson wrote. pic.twitter.com/0jJxrMOngw
— Mosheh Oinounou (@Mosheh) April 27, 2020
Cal-Maine Foods has said it will “vigorously defend itself” against a lawsuit issued by the Texas attorney general alleging the US-based egg supplier has engaged in price-hiking during the Covid-19 pandemic.
The lawsuit alleges that Cal-Maine hiked the price of eggs from about US$1.00 per dozen to about $3.00, despite experiencing no disruption to its supply chain.
US poultry processor Foster Farms has seen four employees at its plant in Kelso, Washington, test positive for coronavirus.
Cowlitz County health officials said in a statement seen by just-food that the positive tests came to light when a phased testing procedure for potentially exposed plant employees was carried out on 22 April on 77 workers at the plant.
It said that in coordination with Foster Farms, health officials will conduct a second round of testing at Foster Farms on approximately 115 additional employees today (27 April).
Tesco extends helping hand to potato grower Branston
Tesco is trying to help UK farmers left with surplus stock because of the shut down of restaurants during the lock down and has agreed a tie-up with potato grower Branston.
The big four UK supermarket chain will be stocking Branston’s 2.5 kilogram bags of white, baking and ‘Perfectly Imperfect’ potatoes normally destined for foodservice channels such as chip shops during the next two weeks.
Branston is based in the village of the same name in the county of Lincolnshire.
Since the start of the coronavirus crisis, Tesco said potato prices had increased by around 20% due to “inflated demand”.
Ben Rowbotham, who is in charge of potato sourcing at Tesco, said: “Taking these surplus potatoes not only helps meet the extra demand at the moment but also supports growers at a time when many are facing a real struggle to keep their businesses going. The varieties are mainly ones used for making chips, so while they might not look as cosmetically perfect as others they will still be delicious and excellent for pan frying, sautéing, making potato wedges and other dishes.”
A new week and more news from North America on how the pandemic is affecting production among food manufacturers.
Brazilian meat packer JBS has closed a fourth US plant because of coronavirus, this time in the state of Wisconsin.
The temporary shutdown at the firm’s Green Bay facility was announced yesterday (26 April). Previously closed beef processing plants in Souderton, Pennsylvania, and Greeley, Colorado have reopened, JBS said in a statement, adding that its pork facility in Worthington, Minnesota, remains in shut-down mode.
US pork-processing giant Smithfield Foods is to shut another plant this week due to the Covid-19 pandemic.
Smithfield, owned by China’s WH Group, said it is to “suspend operations” at its facility in Monmouth, Illinois from this next week “until further notice”.
The company, which has shut sites in Iowa, Wisconsin and Montana, added “a small portion” of the 1,700 employees at the Monmouth plant had tested positive for the novel coronavirus.
McCain Foods, the Canada-based potato-products supplier, has confirmed more jobs have been affected as the company tries to adjust to how Covid-19 has affected demand.
The company is temporarily laying off workers at a site in its domestic market, a move that follows cuts to production in the UK, where workers were also put on leave.
The US United Food and Commercial Workers International Union (UFCW) is urging the government to provide more protective equipment for food plant employees, claiming up to 6,500 workers have been infected with or are exposed to the virus.
Tyson Foods, the US meat titan, has confirmed that the Covid-19 outbreak has forced it to close another plant.
After the announcements of three plant closures already this week, the Jimmy Dean brand owner has said its plant at Shelbyville, Tennessee, facility is to close temporarily for cleaning.
US meat heavyweight Tyson Foods has suspended production at its Pasco, Washington, beef facility while employees there undergo Covid-19 testing.
It is the third closure announced by the company this week.
Speaking to analysts after reporting first-quarter results, Cloetta’s CEO said talks with employees over potential Covid-19-related layoffs have concluded but was reluctant to provide specifics on numbers at this stage as the impact of the virus halted eight consecutive quarters of growth.
Nestlé today (24 April) posted first-quarter sales that beat market expectations, with the world’s largest food maker bucking a trend among peers and keeping in place its guidance for the rest of 2020.
Cloetta has warned its second-quarter profits will be “significantly lower” than last year amid the upheaval from the coronavirus crisis, which has caused the Sweden-based confectionery maker to withdraw its dividend.
The chief financial officer (CFO) of US meat giant Tyson Foods has advised consumers not to panic over potential meat shortages.
Flat sales and a guidance withdrawal no doubt weighed on Unilever’s shares but, digging down, how did the Wall’s ice cream maker’s food business perform in Q1? And how does the FMCG giant view the rest of the year – and beyond? Dean Best reports.
The notion of “value” will rise up the consumer’s agenda as the macroeconomic impact of the Covid-19 pandemic hits spending, Unilever CEO Alan Jope has said today (23 April).
Speaking to analysts after Unilever reported its sales for the first quarter of 2020, Jope outlined how the FMCG giant was looking at the consumer and category landscape post-Covid-19.
Snacks maker Hershey has withdrawn its financial guidance for the year because chief executive Michele Buck said it has become increasingly difficult to predict the coronavirus impact on the US business.
Unilever has extracted its financial guidance after the Anglo-Dutch consumer goods giant reported the impact of Covid-19 on its business in the first quarter, when underlying sales growth was flat.
Emerging markets were hit the most, with sales down 1.8%, while the performance in developed countries showed a 2.8% increase in sales.Unilever said China “slowed significantly” during the country’s Covid-19 lock down, which began in January, as foodservice demand declined, and ice cream and retail sales tailed off. Meanwhile, Europe and North America “saw a positive impact of household stocking in March”.
US meat giant Tyson Foods is to temporarily close its Logansport facility in Indiana to carry out Covid-19 testing among its workforce there.
Just after a day after the company announced it is to “indefinitely suspend operations” at a pork facility in Waterloo, Iowa, the company said its Logansport plant would cease operations temporarily on or before Saturday (25 April).
US food group Conagra Brands has temporarily halted production at a frozen food plant after an outbreak of the Covid-19 virus among employees there.
The West must transform its economic logic in light of the coronavirus
Against a life-threatening virus and a shortage of medical equipment, neither the free market nor socialist policies can be made to work. What we need is a different set of principles: a set of principles that transforms the economic logic of the West, writes Robert Skidelsky – author of a three-volume biography of J M Keynes, a cross-bench peer and emeritus professor of political economy at the University of Warwick – in the New Statesman today.
“Since we have no ethically accepted principle of choosing between who is to live and who to die, we should take exceptional pains to ensure that we do not face acute shortages of life-preserving equipment. It is a scandal that the developed world was caught so short of tools to deal with the pandemic,” he writes.
“We need to restore what used to be called ‘the precautionary principle’. In all those situations in which we can rationally anticipate a severe life-threatening event, ‘just-in-time’ thinking needs to be replaced by ‘just-in-case’ thinking.”
You can read the full article here.
Gordon Brown on economic crises, the retreat from globalisation and the fight against Covid-19
In a wide-ranging interview published on the New Statesman today, former UK Prime Minister Gordon Brown says the coronavirus pandemic is “undoubtedly a crisis of globalisation” – but the solution is more global cooperation, not less.
Brown says the crisis will “force us to rethink what we mean by the management of the global economy”, as well as what constitutes the “right policies for a global society”.
“It is the beginning of a period of quite intense rethinking, partly because we enter it having had a period of protectionism … the past two or three years, we’ve moved to a more aggressive nationalism, which is America First. It’s the attempt to put populist nationalism on a global level – India First, China First and everything else – so you’ve got, if you like, a global coalition of anti-globalists,” he says.
“Some of the assumptions of globalisation are being challenged, but it actually makes it more important that we put the case for global cooperation rather than simply accept that certain countries are resistant to it. If you’ve got a medical emergency, a pandemic, it is the most obvious example of where countries have to cooperate. You cannot solve this problem in one country; it has got to be solved in every country.
“Even the most isolationist nations must know that you cannot solve it simply in the US or Europe. If you can’t agree on health multilateralism, what kind of multilateralism can you agree on?” Brown also speaks about the dangers of “vaccine nationalism”, about the prospect of a universal basic income, and how coronavirus will change the UK’s social contract.
You can read the full piece here.
Nestlé has received the green light from government officials in India to re-start production at all its factories in the country.
Last month, the Maggi maker said it had “scaled down or suspended” parts of its operations in India after parts of the country had implemented lockdown measures. Hours after Nestlé’s announcement, India’s Prime Minister, Narenda Modi, announced a nationwide lockdown for 21 days, a measure since extended to last until 3 May.
Yesterday, the publicly-listed Nestlé India issued a stock-exchange filing that provided an update on its manufacturing network in the country.
The US Department of Agriculture (USDA) has launched the Coronavirus Food Assistance Program to aid farmers, ranchers and food distributors and to “maintain the integrity” of the country’s food supply chain.
The US$19bn relief programme includes $16bn in direct support to framer and ranchers based on actual losses for agricultural producers where prices and market supply chains have been impacted
It is intended to assist them with additional adjustment and marketing costs resulting from lost demand and short-term oversupply for the 2020 marketing year caused by Covid-19.
A day after announcing production would re-start at one coronavirus-hit plant in the US, Tyson Foods said today (22 April) it would stop output at another.
Tyson plans to “indefinitely suspend operations” at a pork facility in Waterloo, Iowa, this week.
Scaled-down production at Tyson’s fresh beef and pork facility 120 months south in Columbus Junction started yesterday. Manufacturing at the plant was suspended two weeks ago because of a number of Covid-19 cases, and, according to reports, some deaths.
Big brands might be able to prosper as consumers adjust after the Covid-19 pandemic, Danone has suggested.
Speaking to analysts yesterday (21 April) after Danone reported its first-quarter sales – and withdrew its financial guidance for 2020 – the company’s management, though underlining it is hard to make firm forecasts on future consumer behaviour, indicated their belief larger brands could resonate with shoppers.
Agreed with Danone. In 2019 we saw the first move back to larger brands anyway. The Covid-19 reset is providing a new dimension.
— Cyrille Filott (@Cyrille_Filott) April 23, 2020
US agri-food giant Cargill is to reportedly suspended operations at a meat factory in North America as health officials said hundreds of the facility’s staff have been infected with Covid-19.
Glanbia has pulled its financial guidance for the year as the Ireland-based dairy and sports nutrition business said volatile trading conditions due to the coronavirus crisis became more pronounced toward the end of the first quarter and beyond.
New Zealand-based dairy and infant-formula producer A2 Milk Co, has experienced a sales boost as result of Covid-19-linked pantry-loading, it said in a trading update issued on the Australian Securities Exchange (ASX), on which it is listed, this morning (22 April).
Danone today (21 April) posted first-quarter sales that beat analyst expectations, with the French giant boosted by Covid-19 pantry-loading. However, the Alpro maker withdrew its financial guidance for 2020, which may have weighed on its share price. Dean Best takes a look at the numbers and Danone’s commentary.
Tyson Foods will start scaled-down production at its fresh beef and pork facility in Columbus Junction, Iowa, today (21 April) after manufacturing was suspended two weeks ago because of a number of Covid-19 cases, and, according to reports, some deaths.
Don Miguel Foods, a US-based Mexican foods manufacturer, has been forced to close its plant temporarily due to the spread of Covid-19, adding another facility associated with food giant Hormel Foods to be shutdown.
Brazilian meat giant JBS will reportedly shut down its pork processing plant in Minnesota run by its US subsidiary after seven workers tested positive for Covid-19.
Over a week ago, JBS, one of the world’s largest meat processors, announced the temporary closure of a beef plant located in Greeley in Colorado’s Weld County until 24 April, again because of coronavirus.
US jam, peanut butter, relishes and snacks maker J. M. Smucker has improved its sales guidance for its fiscal year, reflecting a Covid-19-linked surge in demand for the sort of products it manufactures and a relatively small exposure to the foodservice channel.
J. M. Smucker is still forecasting a decline in annual sales but one not as steep as previously thought.
French dairy giant Danone said it will not be providing financial guidance for the rest of this year because of the uncertain economic climate created by the Covid-19 pandemic.
Associated British Foods has refrained from providing financial guidance for the year and will not declare a dividend as the impact from the coronavirus crisis is expected to ramp up in the second half.
High Liner Foods, the Canadian frozen seafood products company, is to temporarily close its plant in Portsmouth, Ontario, following the discovery of confirmed Covid-19 cases amongst its employees there.
New Zealand dairy heavyweight Fonterra is to maintain strict safety controls even though the country has announced the gradual lifting of Covid-19-linked lockdown restrictions.
The cooperative, the world’s largest dairy exporter, said it will keep operating a level 4 health and safety regime even when the country moves to a level 3.
New Zealand has announced it will ease restrictions from next week. Prime Minister Jacinda Ardern said yesterday (20 April) that the country had succeeded in stopping “an uncontrolled explosion” of the disease.
The country will be put on a level 3 alert from 27 April for at least two weeks, then the government will assess whether to further relax the lockdown.
But Fonterra CEO Miles Hurrell, speaking at a Trans-Tasman Business Circle event, said it will remain under a level 4 scenario.
“We just can’t afford the risk of any disruption to our supply chains,” he said.
Fonterra said it will not ease its controls until the government reduced the alert level to 2, when it would look at a phased return to the workplace, with extra safety precautions and travel restrictions remaining.
In New Delhi, our correspondent reports on how India’s packaged food industry is hoping to restart more of its operations this week, with leading members saying state and municipal governments are increasingly willing to approve exemptions for the sector from a nationwide Covid-19 lockdown on manufacturing and trade, currently in place until 3 May.
US meat giant Hormel Foods revealed a plant owned by its Alma Foods subsidiary is to close temporarily due to a positive Covid-19 case, adding to another unit’s site closure announced earlier today (see below).
Tyson Foods, one of the world’s largest meat companies, has reportedly confirmed more of its domestic staff have died from Covid-19.
According to AP, the meat titan has said three employees at its chicken-processing plant in Camilla, Georgia have died after contracting the novel coronavirus. A fourth person, who worked in what was described in the report as a supporting job outside the plant, has also died.
Packaged-food companies mulling the post-Covid-19 consumer will be watching China with interest. Our local columnist Peter Peverelli sets out some trends that could take hold.
US agri-food giant Cargill has been linked with a mass outbreak of Covid-19 at its Canadian meat-packing plant in High River, Alberta.
UK’s Premier Foods forecasts elevated sales volumes
Premier Foods, the UK manufacturer of largely shelf-stable foods, expects sales volumes to continue to be above-average after a “dramatic short-term peak” in March.
The owner of Mr Kipling cakes said it has seen the spike in volumes “across many of its categories” last month.
And, in a trading update to the London Stock Exchange this morning, Premier added: “Volumes have started to reduce from the exceptional levels seen in March, although are still expected to continue to be higher than average patterns of demand. This reflects more meals being eaten at home than usual due to recent measures set out by HM Government and hence increased demand for the group’s product ranges.”
Italy’s higher demand for homegrown food products is “atypical and fleeting”, the president of food industry association Federalimentare has warned.
Ivano Vacondio said hoarding by Italian consumers during the Covid-19 outbreak has, until now, camouflaged problems that will soon emerge.
US-based Rochelle Foods, owned by local heavyweight Hormel Foods, has been forced to halt production for 14 days as a result of the Covid-19 outbreak.
The Illinois company, which makes bacon and ham-based products and microwaveable meals for the foodservice and retail channels, has been shut down by the local health department.
US speciality food manufacturer Armanino Foods of Distinction has said it expecting to post a loss in the second quarter as a result of Covid-19.
Mondelez International talks snacks trends and Covid-19
In an exclusive interview with just-food, US snacks giant Mondelez International talks about SnackFutures, an innovation and venture hub the Oreo owner set up to improve its agility and identify new areas of growth.
In the interview, Brigette Wolf, the head of innovation at SnackFutures, discusses the company’s recent investments in start-ups and its launch of four new brands.
And Wolf also discussed how Mondelez sees Covid-19 shaping demand for snacks.
Reports, unconfirmed by the company, suggest that there are now more than 500 Covid-19 cases at US meat giant Smithfield Foods’ pork processing plant in Sioux Falls, South Dakota.
Nestlé has confirmed an employee at its confectionery factory in the UK town of Halifax has tested positive for Covid-19 and is receiving treatment in hospital.
Belgium-based fruit and veg supplier Greenyard has adjusted its sales guidance upwards after seeing a surge in demand for its produce linked to the Covid-19 outbreak.
Fry Group Foods, the South African meat-free manufacturer, has temporarily closed its facility after a manager contracted the Covid-19 virus.
The Durban-based company, which makes plant-based burgers and sausages amongst other products, confirmed in a statement sent to just-food that its Westmead premises will be locking its doors.
General Mills points to demand for brands consumers “trust”
General Mills CEO Jeff Harmening said the US food company has seen an uplift in sales as people turn to comfort food while staying at home during the outbreak.
Speaking to the Fox News Network, he said: “Consumers have rediscovered brands that they known and trust like Pillsbury, Betty Crocker and Cheerios and as a result we have seen demand for our products grow.
“Where we’ve really seen an increase is in meal occasions as people are no longer eating out at restaurants.”
Asked about issues linked to manufacturing, Harmening said General Mills has seen attendance levels of 95%+ at its plants.
South Africa’s Tiger Brands has shut a bread production facility after an undisclosed number of coronavirus cases among staff.
Tiger said it would “temporarily close” its bakery in the city of Durban “as a precautionary measure after some staff members tested positive for Covid-19”.
Nordic group Orkla reports boost to Q1 sales
Orkla, the Norway-based FMCG group, has reported growing first-quarter sales, helped in part by higher demand linked to the coronavirus outbreak.
The company, which today (17 April) issued a preliminary sales update ahead of a fuller announcement of its first-quarter results in early May, said its revenue in the first three months of the year was up 13% at NOK11.51bn (US$1.1bn).
Revenue from Orkla’s core “branded consumer goods” business grew 15% to NOK11.32bn.
Looking at revenue per business unit, Orkla Foods saw its revenue grow 19% (and by 11% on an organic basis).
Sales from Orkla’s Confectionery & Snacks arm rose more slowly, increasing by 7% during the quarter (and by 2% on an organic basis).
Orkla Food Ingredients, which does have some exposure to the out-of-home market, saw its sales fall 1% on an organic basis, although they rose 12% on a reported basis, helped, in part, by M&A.
Ter Beke plans to integrate its meat-processing operations in the Netherlands by bringing the Offerman business in-house just as the Belgian food group has taken other measures to deal with the volatile demand arising from the coronavirus crisis.
US-based agri-food business Cargill has reduced shifts at a meat processing plant in Canada after an undisclosed number of employees tested positive for the deadly Covid-19 virus.
UK trade union GMB, which represents food production workers, has called for a Covid-19 food factory safety summit amid concerns about a lack of social distancing within facilities.
GMB has asked the government to convene an urgent meeting with grocery retailers and industry body the Food and Drink Federation to thrash out the issue.
Aldi dips toe into home delivery in UK
German discounter Aldi is to join the online grocery fray in the UK, launching a service tomorrow for “vulnerable customers”.
The retailer said it will sell “ambient food parcels”, containing 22 items including tinned soup, rice and pasta.
The parcels are available online at https://www.aldi.co.uk/food-parcels and will retail at £24.99 inclusive of delivery. They will be limited to one per customer.
Aldi is the UK’s fifth-largest food retailer by market share, accounting for 8% of sales in the 12 weeks to 22 March, according to the latest data issued by Kantar. Its sales grew by 11% during the period.
The retailer has 875 stores in the UK. By 2025, Aldi plans to operate more than 1,200 outlets.
Here’s some analysis of this move, written by our colleagues at GlobalData: Aldi’s UK online grocery push will be closely watched
The US Department of Agriculture (USDA) is to take steps to maintain the country’s food supply chain which is threatened by the Covid-19 pandemic.
This includes buying meat and milk to help farmers hit by coronavirus.
In an interview with Fox Business Network, Agriculture Secretary Sonny Perdue said: “We want to purchase as much of this milk, or other protein products, hams and pork products, and move them into where they can be utilised in our food banks, or possibly even into international humanitarian aid.”
Smithfield Foods, the US meat giant, has announced it is to close two more processing facilities after positive Covid-19 tests amongst its workers.
Campbell Soup Co. said six employees at the US food heavyweight’s Denver, Pennsylvania, bakery plant have tested positive for Covid-19 and are in quarantine.
Costa Group Holdings, an Australia-based fruit and vegetable supplier, has withdrawn its financial guidance because of the uncertainties from coronavirus, despite noting a “robust trading performance” for the year so far.
The Covid-19 pandemic will “herald a new era of responsible consumption”, Unilever chief executive Alan Jope has predicted.
Speaking to CNBC, Jope said the coronavirus crisis would “accelerate” efforts among government, business and civil society to work together to tackle “big problems” such as climate change and inequality.
Jope, a Unilever veteran who took the helm at the Knorr and Magnum maker at the start of 2019, also told the business broadcaster “there’s no doubt the world’s going into recessionary times” and said the “value-for-money elements” of companies’ portfolios “will play an especially important role, probably in the next three years or so”.
The meat industries in the US and Canada have seen factory suspensions and closures due to Covid-19. How can processors react? And what might be the impact on supply?
Grupo Bimbo said two employees at one of the Mexico-based bakery firm’s US plants have tested positive for Covid-19, although the facility in Lehigh Valley, Pennsylvania remains operational.
The US bakery unit of Mexico-based Grupo Bimbo is to reopen a plant in Pennsylvania temporarily to help meet the increased demand from coronavirus as lockdowns that have shuttered restaurants prompt people to eat more at home.
US bakery business Flowers Foods is closing its Georgia plant for around two weeks “out of an abundance of caution” after a number of employees at the site contracted Covid-19.
The facility in the city of Tucker, which normally employs 255 workers and produces frozen bakery products for the foodservice sector, will reopen “on or around” 27 April, the Nature’s Own and Dave’s Killer Bread brand owner said in a statement today (14 April).
Aviko, the Netherlands-based French fries producer, has warned of potential job losses as a result of Covid-19’s impact on the foodservice channel.
The company has asked the Dutch government for a wages subsidy to help it weather the coronavirus storm.
JBS, the Brazil-based meat behemoth, has announced the closure of a beef production facility in the US amid reported multiple cases of Covid-19 at the plant.
The company, the world’s largest processor of beef, said the factory, located in Greeley in Colorado’s Weld County, will be shut until 24 April.
Olymel, the Canadian pork and poultry processor, is to reopen a factory temporarily closed due to a number of Covid-19 cases among employees.
The company, part of Canada’s Solio Cooperative Group, said the hog slaughter and cutting plant in Yamachiche would open today (14 April).
Olymel announced the closure of the facility on 29 March after nine workers tested positive for the novel coronavirus.
The UK’s National Farmers Union (NFU) has asked the country’s government for a coronavirus-linked “crisis” meeting to discuss the dairy sector’s problems.
Tiger Brands, the South Africa-based FMCG group, has shut a number of its plants as the company adjusts to the coronavirus pandemic.
08:35 BST – Welcome back after what we hope was a restful Easter break (for those of who in parts of the world that marked the festival).
Over the period, two of just-food’s network of global correspondents filed updates of how the pandemic was affecting parts of the food industries in their respective countries.
Spain’s food manufacturing body has called on the country’s government to offer more help in supplying personal protective equipment (PPE) to companies that have stayed open during the Covid-19 pandemic.
The Federación Española de Industrias de Alimentación y Bebidas (FIAB) is also urging the Spanish government to offer financial packages for food manufacturers supplying restaurants and cafes closed by the lockdown and offer companies protection against price gouging by some suppliers.
Nordic poultry products group Scandi Standard has implemented “precautionary cash preservation measures” in the face of the coronavirus crisis, which has pushed up retail sales but dented its foodservice operations.
India’s major dairy companies are reorienting procurement and processing towards solid dairy products, taking advantage of the supply chain and demand disruptions caused by the 21-day national lockdown imposed by the government to control the spread of Covid-19.
Smithfield Foods, one of the world’s largest pork producers, has closed “until further notice” one of its biggest production facilities in the US amid what are reported to be dozens of positive cases of Covid-19 among staff.
“The closure of this facility, combined with a growing list of other protein plants that have shuttered across our industry, is pushing our country perilously close to the edge in terms of our meat supply,” Smithfield president and CEO Kenneth Sullivan said.
And our US columnist Victor Martino has today set out what he sees as the four stages of change that will impact the country’s food industry – with analysis that will resonate beyond US borders.
Victor writes: “As recently as February none of us had any idea 2020 would be a year of fundamental change for the food industry.
“But then came the Covid-19 pandemic, which is delivering a blow to the sector’s central nervous system like none we’ve ever experienced before. All that was solid as we began 2020 has melted into thin air.
“Like you all, I’m spending a considerable amount of time thinking about what the Covid-19 pandemic means for the food industry and CPG companies, not just today but for the immediate future. What changes will we need to make to adapt in the wake of Covid-19?
“There will be four waves or stages of change that will impact the food industry in the coming months. The severity of these waves or stages of change will depend on how severe the global pandemic is, which at this point in time is unknown.”
UK private-label major Bakkavor is again in the spotlight over its business practices during the Covid-19 crisis after a manager threatened to sack staff who stayed at home.
During a presentation at a Bakkavor plant in London, secretly filmed and shared with UK newspaper The Guardian and broadcaster ITV News, Sean Madden, head of operations at the factory, said staff who missed work when they were not sick could be first to be made redundant if cuts were needed.
The video, which can be seen on The Guardian‘s website here, has Madden telling staff: “If we need to get rid of 200 people’s jobs next month, I’m going to look at who turned up to work and I’m going to look at who didn’t bother turning up to work. The people who didn’t bother turning up to work, you know, they will be the first people that we have to get rid of unfortunately.”
The US poultry sector’s “delayed response” to coronavirus is “leaving most workers unprotected”, a trade union representing thousands of workers across the food industry has warned.
The Retail, Wholesale and Department Store Union (RWDSU) claimed “the poultry industry as a whole is getting it wrong” on safety standards, claiming “too many workers have already been infected and are suffering the consequences”.
In response, trade association The National Chicken Council has insisted its members take “very seriously our responsibly to keep workers safe while providing protein for families”, with a spokesperson arguing the industry “began increasing efforts to protect workers even before the virus started spreading more than a month ago”.
Kraft Heinz debuts home-delivery to help isolated workers
Food heavyweight Kraft Heinz has launched an online delivery service in the UK for consumers to purchase its most popular canned items such as baked beans.
The US-based business said its ‘Heinz to Home’ service is designed to cater to people in self-isolation due to coronavirus and is able to deliver to homes within three days.
As well as Heinz Beanz, Heinz Hoops and Heinz Cream of Tomato Soup will feature initially, with plans to follow with ketchup and baby foods. All are supplied as bundle purchases for GBP10.00 (US$12.45).
Kraft Heinz said it has partnered with Blue Light Card, a UK discount service for workers in the NHS, emergency services, social care and the armed forces.
“The shop is a first for us, and it comes in response to stories we’ve all heard in the last few weeks,” said Jojo de Noronha, the president of Kraft Heinz Northern Europe. “Stories about people struggling to access food and basic necessities, where people are understandably upset about how they are going to eat and stay healthy during this pandemic, and about people who need food but can’t access it in any of the usual ways.”
McCain Foods, the Canada-headquartered french fries maker, is cutting production across three UK plants and putting some workers on leave as coronavirus restrictions eat into foodservice demand.
Dairy industry groups in the US are urging the government to provide a “comprehensive action” plan for the sector as the Covid-19 crisis causes a disparity between supply and demand.
New Zealand-based dairy giant Fonterra said two of its employees at its Edendale distribution centre had tested positive for Covid-19, and the facility was closed temporarily on Tuesday (7 April) for deep cleaning.
Bonduelle is another major food manufacturer to have pulled its financial guidance, citing “uncertainties” created by Covid-19.
Orior, the Switzerland-based fresh meats and pasta business, has also said it can no longer abide by its previously-announced financial guidance due to the uncertainties created for the listed-business from coronavirus.
US major Conagra Brands details recent sales spike
Conagra Brands, the owner of US brands such as Hunt’s ketchup and Chef’s Boyardee pasta, last week provided a flavour of the impact Covid-19 is having on its business – and bucked the trend of some of its peers withdrawing financial guidance by announcing it expected to exceed its previously announced outlook.
The Banquet ready-meals maker has given another update, issuing a stock-exchange filing ahead of meeting with investors.
Conagra’s statement last week came alongside the publication of its third-quarter results to 23 February. The 8-K stock-exchange filing issued yesterday gave some additional details on Conagra’s performance, covering the week to 29 March.
The company said its retail sales had jumped more than 30%, boosted by a 17.5% rise in retail sales of its frozen food and an 11.4% increase in snacks sales.
Conagra also said its share of all the categories in which it operates had increased by 20 basis points during that week, compared to a year ago.
Murray River Organics is pulling its financial guidance almost a month after the Australia-based dried fruit snacks producer first revealed the initial impact from Covid-19.
MRG has been struggling financially for some time, reporting EBITDA losses for each of the past three years. In 2019 the business said it was seeking additional equity funding to support future expansion but Covid-19 now presents an additional challenge.
Last year’s results showed a 12% decline in revenues to a tad over AUD60m (US$37.5m), and an EBITDA-S loss of AUD3.6m, down from a AUD14.3m loss in the corresponding period.
France’s LDC gives update on business impact
LDC, the French poultry and prepared-foods supplier, has issued an update to the stock market on how Covid-19 has affected the business so far.
Alongside the publication of its annual revenue for the year to 29 February, the Paris-listed LDC said the “sharp slowdown” in the out-of-home market, combined with “purchasing developments” in the supermarket and hypermarket channels had led to “declining activity across the group, both in France and abroad”.
LDC said it had sought to reallocate capacity usually used to supply the foodservice market towards retail customers.
The company said it had seen “increased business” in France’s retail sector, although demand had been “mixed”, with sales of speciality products such as duck and guinea fowl done. Sales of products meant for individual consumption, such as ready meals and sandwiches, were also lower.
However, sales of “traditional” products, such as chicken, as well as convenience items like nuggets, had seen “a very good level of activity”, LDC said.
“Beyond the resilience of its model and its market positions, the group also has a solid financial situation, which allows it to be confident in its resilience,” LDC said.
In the year to 29 February, LDC generated revenue of EUR4.42bn, up 7.2% on 12 months earlier.
The shopping habits of consumers living under lockdown and concerned about the coronavirus pandemic are leading to some healthy-eating trends “being put on the back-burner”, according to new research from GlobalData.
Nevertheless, GlobalData expects consumer interest in health and wellness to return when the coronavirus crisis eases, with government initiatives also helping to leading to a rebound in demand for healthier fare.
2 Sisters factory staff return after walk-out
Production at a 2 Sisters Food Group plant in the south west of England is back to normal today (8 April) after a group of staff staged a walk-out yesterday over pay and conditions.
Workers on the morning shift at 2 Sisters’ poultry-processing factory in Willand in Devon did not report for work yesterday. The company said today all staff are “back to work as normal”.
“Yesterday morning a small percentage of workers sought clarification from management on pay arrangements and terms and conditions during the coronavirus crisis. Following briefings they are now clear on the options available to them and everyone is back to work as normal,” a spokesperson for the site said.
Two weeks ago, 2 Sisters said it was hiring “several hundred” workers across its UK-based businesses – poultry, bakery and meal solutions – to cope with an upsurge in demand from coronavirus.
Maple Leaf Foods, the Canada-based meat packer, said four employees have tested positive for Covid-19 at two of its plants.
Over the border, US agri-food business Cargill has reportedly closed a meat plant in Pennsylvania temporarily due to coronavirus.
The site in the city of Hazelton was closed on Tuesday (7 March) and will remain shut until further notice, Reuters reported, citing a statement from the Minnesota-based business.
just-food has approached Cargill to confirm the closure and ascertain the reasons behind the move.
As the Covid-19 pandemic continues to rage worldwide, on our analysis pages Lucy Britner looks further ahead to suggest how the crisis could change consumer behaviour.
“The entire planet is in various stages of lockdown. This unprecedented time in our history has effectively shut down swathes of the foodservice sector, closed bars and pubs and sparked a jump in the use of grocery e-commerce, leading food retailers worldwide to invest quickly (and heavily) in their online supply chains.
“In the week to 21 March, UK grocery retail sales jumped 45% as shoppers, concerned about the infectious nature of Covid-19, flocked to stores and online to stock up.
“Locked-down consumers also sought solace online in other ways. Consumers of all ages have also had to find new ways to communicate, with the download of online apps booming. So, what does all this mean for the future?”
UK retail giant Tesco reports annual results – and discusses Covid-19 impact
Some coronavirus-related factlets coming from Tesco’s announcements of its full-year financial results this morning:
- Tesco said it saw “significant panic-buying” in the UK “in the first few weeks of the crisis”, which the grocer equated to a “circa 30% uplift in sales”
- In the last two weeks, Tesco has recruited more than 45,000 staff
- Tesco has “stepped up” capacity in online business by more than 20% but adds: “There is simply not enough capacity to supply the whole market.”
- The retailer estimated extra costs linked to the Covid-19 crisis in the 2020/21 financial year could be GBP650-925m (US$804-1.14bn)
The retailer’s presentation gave a snapshot of how Covid-19 had affected sales by category.
Stockpiling for #covid19 via Tesco. Greatest sales volume uplift was on Beans and Peas, then toilet tissue! Canned Tomatoes, Pasta and handwash.
Just look at the numbers. A reminder that certain analysts in our space blamed the supermarkets for not having enough stock…. pic.twitter.com/oRMK2nHbc2
— Steve Dresser (@dresserman) April 8, 2020
Spain has loosened regulations covering the hiring of temporary workers in the country’s agriculture sector.
European confectionery manufacturer Cloetta said it has started a dialogue with employees over the prospect of temporary layoffs after it confirmed pick-and-mix sales had been hit by lower demand as a result of disruption from the coronavirus outbreak.
UK baker Real Good Food has reported an increase in annual revenues and profits but the UK-based firm said it expects a “material impact” on sales from Covid-19 in the first quarter of its new financial year.
After The Simply Good Foods Co., the US-based health snacks maker, reports its latest financial results, Simon Harvey reports on how the company has ramped up inventories and shifted the focus of its marketing spending as more consumers shop online rather than in retail stores amid the coronavirus outbreak.
Mark Schneider, the CEO of Nestlé, has admitted the world’s largest food maker has been unable to hit its “normal” production levels during the Covid-19 pandemic.
Speaking to Bloomberg TV, Schneider said the KitKat and Maggi owner had faced issues along the supply chain.
Kraft Heinz has made an about-turn on its financial guidance for the year as the US food giant expects “very strong consumer demand” linked to coronavirus to drive positive growth in sales.
A message from our publisher: at 3pm today UK (10:00 EST), two of GlobalData’s analysts are hosting a free webinar on how the coronavirus pandemic is affecting the consumer-goods sector.
The sessions will last approximately 30 minutes and cover the impact the crisis has had on the world’s major economies, with details on revisions to GDP growth forecasts.
GlobalData analysts Stuart Ravens and Katie Page will also discuss how governments have responded to the outbreak, covering testing and clinical trial delays.
They will also set out specific implications for the consumer sector, including updated forecasts, as well as outlining how companies have responded.
In the US, meat titan Tyson Foods has suspended operations at a pork plant in Iowa after more than “two dozen” employees contracted coronavirus.
Kroger outlines changes to promote ‘social distancing’
Kroger has become the latest major US grocer to announce plans to implement measures to encourage social distancing in its stores.
The retailer, which runs almost 2,800 stores in the US, is to cut the number of customers that shop in its outlets at any one time by half.
“Kroger’s introduction of customer capacity limits is one more way we are doing our part to flatten the curve while operating as an essential business, providing our customers with access to fresh, affordable food and products,” Mary Ellen Adcock, Kroger’s senior vice president of operations, said. “During this national pandemic, we are committed to adopting preventive measures to help protect the safety and health of our associates, customers and communities.”
Among other measures, Kroger is encouraging its staff to wear protective masks and gloves. The retailer is also trialling one-way aisles in certain stores in order to “determine its effectiveness as a measure to further support physical distancing”.
Weetabix, the UK breakfast-cereal business owned by US manufacturer Post Holdings, is recruiting staff as it tries to adapt to the coronavirus outbreak.
Mars puts up Covid-19 cash
Mars has pledged US$20m “to better support the communities” in which the US food giant operates.
The Snickers and Wrigley owner has set out a series of measures, including $5m donation to support the non-governmental organisation CARE in its work supporting women, children and the refugees in the developing world.
Mars is to make a $2m donation to the United Nations’ World Food Programme and a further $1m to Humane Society International (HSI) to help cats and dogs that have been abandoned. The company is one of the largest pet-food and pet-care businesses worldwide.
Grant Reid, Mars’ CEO, said: “We’re announcing a commitment of $20m in cash and in-kind product donations to support the hundreds of communities where we live and work, or whom we depend upon for our agricultural ingredients. We’re all in this together and we want to do our part to help those most in need.”
One of our correspondents covering France, Sophie Kevany, has spoken to a clutch of firms operating in the country about the impact the coronavirus outbreak has had on business.
“For several years now, we [the agri-food sector] have been regularly criticised and vilified by animal activists or for our use of plant protection products. But today, we are seen as saviours, almost as much as health workers, refilling empty supermarket shelves. That’s a remarkable change for us,” Eureden chairmen Serge Le Bartz and Georges Galardon told her.
Grupo Calvo, the canned seafood producer based in Spain, has hired an additional 50 workers to cope with the increased demand related to the coronavirus crisis.
The Simply Good Foods Co. has withdrawn its financial guidance after Covid-19 caused swings in retail demand for the US-based firm’s assortment of nutrition bars, salty snacks and confectionery.
Reporting results for the second quarter, with sales up more than 83% to US$227m, the company said today (6 April) it witnessed “volatile foot traffic” in March, with the month beginning strongly but then tailing off in the latter half.
One of US food group Lancaster Colony’s employees has tested positive for Covid-19 and is now in self-isolation at home.
The Ohio-based firm said the member of staff had reported the illness last week and was not at work at the time. The employee is now under quarantine for 14 days on full pay.
Confidence among UK consumer has tumbled towards levels last seen in the 2008 financial crisis.
Researchers at GfK have reported UK consumer confidence stood at a score of minus 34 at the end of March, down from minus 7 in February.
In mid-March, before the UK announced its own so-called lockdown measures, consumer confidence in the country stood at minus 9, as per the GfK figures.
Analysts at UK stockbrokers Shore Capital said this morning: “Each week that goes by of lockdown, turns the pressure on the British economy another notch. The Chancellor has been brave, nay heroic, in his efforts to support wages and liquidity of some businesses.
“Whilst so, it is also evident that the administrators are becoming busier and busier. As such, many folks are, understandably feeling more worried about what emerges on the other side of coronavirus. These worries are most clearly manifested in the GfK consumer confidence data, data that brings home some of the economic reality of this crisis.”
Canadian pork giant Olymel hits out at “untrue” allegations
Olymel, the Canadian pork processor, is the latest food company to move to rebut allegations about its business during the crisis.
In a statement on Friday (3 April), the company hit out at the “untruthful and irresponsible information” circulated on social networks that day alleging “to the effect that products from its pork processing facility in Yamachiche could transmit the Covid-19 virus”.
Olymel announced last week it had temporarily closed the plant in Quebec due to a number of Covid-19 cases among employees.
Olymel’s statement on Friday pointed to official guidance from international experts about the lack of a link between food and Covid-19.
“All Olymel food processing facilities are under the jurisdiction and constant supervision of the Canadian Food Inspection Agency (CFIA). The CFIA and public health officials who are monitoring the disease closely make the same observation and have not found any example of transmission of COVID-19 in a food. This information is also based on scientific research from the European Food Safety Authority (EFSA), which claims to have found no evidence that food is a source or a route of transmission,” it said.
“In addition to the hygiene, food safety and quality control measures applied in normal times in Olymel facilities, the company has deployed numerous measures to counter the spread of the coronavirus since the beginning of March. The company invites its employees to strictly follow these measures and has even applied a protocol developed by public health services for all of its establishments, including that of Yamachiche.”
Sanderson Farms, the US-based poultry major that has had 15 positive Covid-19 cases, has lowered its production estimate for the year as the virus wrecks havoc on its mainstay foodservice business.
Germany has eased its Covid-19 restrictions on foreign workers to help its agriculture industry.
ABF management take cut in pay
Associated British Foods, which owns bread maker Allied bakeries and Primark clothing stores, said its chief executive and finance chief will take a cut in salaries to help in the battle against coronavirus.
CEO George Weston and finance director John Bason requested a temporary 50% reduction in pay, which has been approved by the board. In addition, bonuses due to executive directors will not be paid, while Paul Marchant, the CEO of Primark, has also requested his base pay be cut temporarily by 50%.
The non-executive directors of the ABF board, including chairman Michael McLintock, have decided their fees should be reduced temporarily by 25%.
“The board, including the executive management team, believes that these steps are appropriate given its expectation that full-year earnings will now be much lower than envisaged at the start of the financial year,” ABF said in a statement. “The board is acutely aware that many Primark employees will see their livelihoods affected by Covid-19.”
Gluten-free major Dr. Schär has decided to give production workers a 15% bonus for each hour worked during the crisis.
“As a family business, we take it for granted to support our employees in these critical times,” Dr. Schär CFO Brigitte Kurz said. “For our employees, simply taking all the necessary safety precautions to master this challenge did not seem sufficient to us.”
Canadian dairy cooperative Agropur is putting some non-essential workers on temporarily leave and eliminating other positions as a result of coronavirus.
As Raghvendra Verma, our correspondent in New Delhi reports, India’s packaged food industry has been hit hard by the country’s 21-day national lockdown, with most factories closed and their supply chains disrupted, leading to distribution effectively being suspended nationwide.
US food and beverages giant PepsiCo is putting up US$45m to help fight the global battle against coronavirus, including buying protective gear for frontline workers.
Our contributing editor Ben Cooper has spoken to Tim Rycroft, COO of UK industry body Food and Drink Federation, to hear his reflections on how the sector has coped with coronavirus thus far. (FREE TO READ).
The European Dairy Association (EDA) has asked the European Commission (EC) to help to protect the sector against the impact of coronavirus.
Bakkavor, which warned in February the UK food business was seeing a “significant impact” from coronavirus, is now pulling financial guidance and suspending its annual dividend payment.
Brazilian meat giant BRF has announced that it is hiring more than 2,000 people to maintain production and supply during the coronavirus outbreak.
US food group General Mills has announced measures to help it deal with Covid-19, including asking office staff to help out on production lines.
It has also announced enhanced benefits for plant employees, including a daily bonus, and said it will contribute US$5m in charitable grants to support food access in its key global markets and support for “our manufacturing communities” around the world.
CEO Jeff Harmening said: “Our most important objectives are the continued health and safety of our employees and our ongoing ability to serve our consumers around the world. We see it as imperative that we help ensure a steady and reliable food supply for people and pets.”
The UK’s Food and Drink Federation (FDF) has linked up with job recruitment app Syft to support members during the Covid-19 crisis.
The trade body said the partnership will offer a “lifeline” by helping to fill vacancies across the food and drink supply chain.
Syft will work with the FDF’s food and drink members to help them access a database of more than 33,000 workers to fill essential jobs.
FDF’s chief operating officer Tim Rycroft said: “The FDF wanted to provide a solution for those who may be struggling to find work from other sectors and move them into food and drink where possible and Syft provides this opportunity. We hope this is the first of similar collaborations so sectors can share expertise and resources while the country navigates its way through this difficult time.”
Lamb Weston Holdings, the US potato products manufacturer, has become the latest company to pull its annual guidance amid the Covid-19 crisis.
From yesterday’s first-quarter results conference call from US giant McCormick & Co., Simon Harvey reports on how the French’s mustard and Schwartz herbs owner is trying to adapt to the crisis.
UK private-label food firm Bakkavor is facing criticism over its business practices during the coronavirus crisis.
While many packaged food companies are withdrawing financial guidance because of the uncertainties related to coronavirus, US food major Conagra Brands expects to exceed its previously announced outlook.
McCormick & Co. has withdrawn its full-year financial guidance as the US-based spices and sauces maker said first-quarter sales were pressured by the coronavirus outbreak.
The French’s mustard and Schwartz herbs owner said the negative impact on sales from Covid-19 in the three months ended 29 February amounted to 3%, but added the company is “well-positioned” to deal with the crisis due to its “stable cash generation and access to liquidity”.
Consumers in the UK increased their grocery shop over a four-week period as the coronavirus crisis caused more people to eat at home as restaurants and entertainment outlets closed to contain its spread.
Data from Kantar for the fours weeks to 22 March, the day before Prime Minister Boris Johnson announced a nationwide lockdown, showed the average UK household spent an extra GBP62.92 (US$77.73) on food shopping during the period. The rise in spending was more pronounced in London, where it climbed 26%.
Also @Kantar making point (that we made in @C4Dispatches) much of ‘panic buying’ wasn’t. It was families having to cook extra meals.
It estimates an additional 503 meals each week now having to be being prepared at home because cafés/workplaces closed
— Harry Wallop (@hwallop) March 31, 2020
Another interesting Kantar snippet: “With restaurants and cafés now closed, none of us can eat meals on the go any longer and an extra 503 million meals, mainly lunches and snacks, will be prepared and eaten at home every week for the foreseeable future.”
— Bryan Roberts (@BryanRoberts72) March 31, 2020
South Africa’s Astral Foods has hit out at “fake” Covid-19 claims. The poultry producer Astral Foods has slammed a “fake report”, circulated on social media and depicted as a “television news type screenshot”, that said some of its employees had tested positive for coronavirus – and that the country’s health minister has ordered the shutdown of one of the company’s production facilities.
Astral insisted the report was “false”, reporting the claims to a government platform, email@example.com.
“No Astral employee has tested positive for the Coronavirus COVID-19, and Astral condemns this fake news in the strongest possible terms. The company would like to assure all its stakeholders including shareholders, consumers, customers, suppliers and employees that this false news story is completely unfounded,” the company said in a statement.
Mars will reopen a chocolate production plant in the Netherlands today (31 March) shut down around a week ago due to the coronavirus outbreak.
Swiss chocolate manufacturer Lindt & Sprüngli has said its 2020 financial targets are “no longer valid” as a result of the coronavirus outbreak.
Brazilian meat giant JBS reportedly plans to cut beef production at a facility in Pennsylvania in the US for two weeks as a precautionary measure against the deadly coronavirus.
In Australia, listed business TasFoods has withdrawn its financial guidance due to the global uncertainties from the coronavirus outbreak and is having to reduce wasabi production as foodservice sales decline.
Woolworths Ltd, Australia’s largest grocer, has announced plans to “temporarily” change its policy on paying small suppliers.
At present, small trade suppliers to Woolworths’ supermarkets division are paid within 14 days. Across the rest of the retailer’s business, payment terms for small suppliers do not exceed 30 days.
Woolworths said today (31 March) its payment terms would be “aligned” across the group and will not exceed 14 days.
Stephen Harrison, Woolworths’ CFO, said: “We recognise that right now many of our small supplier partners are facing additional challenges in the current climate and we want to do our bit to further help them out by shortening payment terms across the group.
“By paying our small suppliers faster, we hope to ease some of the financial pressure many of them are currently experiencing amid the uncertainty caused by the coronavirus pandemic.”
Olymel, the pork and poultry processor that is part of Canada’s Solio Cooperative Group, has temporarily closed a plant in Quebec due to a number of Covid-19 cases among employees.
An opinion piece from just-food news editor Simon Harvey in the wake of Greencore‘s trading update (and the subsequent fall in its share price) this morning:
Our free-to-read round-up of the major political and economic updates related to Covid-19 has just gone live and can be found here.
The UK and Ireland’s largest trade union, Unite, has called for a mandatory two-metre social distancing to be put in place for those working in the food industry.
It has urged George Eustice, the UK Secretary of State for Environment, Food and Rural Affairs (Defra), to introduce the measure to protect those working on production lines in processing plants during the coronavirus crisis.
In the spirit of offering what support we can during the crisis, our publisher GlobalData has put together a free report to help you understand the outbreak, its economic impact and implications for specific sectors.
A new working week and there have been a series of developments over the weekend and on Monday.
Greencore is suspending financial guidance amid the uncertainty from coronavirus as the Ireland-based business said it is seeing a “marked reduction” at the retail level for its food-to-go categories.
The London-listed convenience foods manufacturer said in an exchange filing today (30 March) it is “tightening” its production network for food-to-go products and putting associated workers on leave by means of the government’s job retention scheme recently announced to support businesses through the crisis.
Just released stock market update on @GreencoreGroup latest response to #coronavirus. Priorities unchanged: (1) keeping our people safe; (2) feeding the UK; (3) Protecting our business. Consumer demand changing & we’re responding rapidly. Thanks to all colleagues #FoodHeroes https://t.co/ExQzfOffcz
— Patrick Coveney (@patrick_coveney) March 30, 2020
UK charity Concordia, which recruits seasonal labour for the country’s agricultural industry, sounds a warning on the lack of workers available to pick crops.
According to UK newspaper The Observer, Concordia has highlighted the problems of recruiting staff from countries that have closed borders to try to deal with the coronavirus outbreak.
2 Sisters Food Group has created a video featuring chief executive Ronald Kers appealing for workers to fill “several hundred” roles as the UK-based poultry and ready meals producer faces a surge in demand from the Covid-19 crisis.
Last week, a spokesperson for the owner of Fox’s Biscuits and Holland’s Pies said the company had launched a recruitment drive across its business for “several hundred” roles.
Vitasoy International Holdings, the Hong Kong-listed, plant-based food and beverage business, has issued a profit warning. It said its sales have been hit by the enforcement of measures linked to Covid-19 and social unrest in the territory.
The firm, which makes products such as soya milk and tofu under its own name, told the Hong Kong Stock Exchange (HKEX) in a statement it expects to record a “substantial decrease” in profit attributable to shareholders for the year ending 31 March.
Brazilian pasta and biscuits maker M. Dias Branco has revealed it has established a crisis committee to help it steer a path through the coronavirus crisis.
Canadian meatpacker Harmony Beef halted slaughter on Friday (27 March) due to a positive Covid-19 test from one of its workers, it has been revealed.
News agency Reuters reports that its Balzac, Alberta packing plant was closed after the company was informed by Alberta’s health department that a worker who had not been on the job for days had tested positive, The company then sent the other workers in his part of the slaughter area home for 14 days, even though they did not display symptoms. The Canadian Food Inspection Agency (CFIA) has kept some inspectors from work, due to the Harmony worker’s positive result.
CFIA said it did not provide inspection services on Friday as a result. Federally-regulated slaughter plants are not allowed to operate without inspectors present.
Harmony was hoping to fully re-open today pending talks with CFIA.
Unsurprisingly, more trade shows have announced their cancellation or postponement.
This year’s Natural & Organic Products Europe, which takes place annually in London, has been cancelled.
The organiser has said the next edition will be on 18 and 19 April 2021 at the city’s ExCel centre, which is being converted by the UK government into an emergency field hospital.
Meanwhile, the organisers of the Free From Functional & Health Ingredients and Free From Packaging events, which were to take place at the RAI Amsterdam from 24 to 25 June, will be postponed to 24-25 November.
Our free-to-read round-up of the major political and economic updates related to Covid-19 has just gone live and can be found here.
Saputo, the international dairy group, believes there will be more opportunity for acquisitions in the wake of the Covid-19 outbreak.
Nomad Foods, the UK-based frozen-food specialist which owns the Findus and Iglo brands, has seen its market share increase in Italy as a result of the coronavirus outbreak.
French dairy giant Danone, has said it is “taking radical measures” to strengthen the resilience of its teams and value chain.
CEO Emmanuel Faber announced on social media a financial support package of EUR250m (US$275.1m) for the 15,000 small businesses in its “global ecosystem” (farmers, suppliers, service providers).
Faber said all employment contracts are secured and wages guaranteed for the 100,000 Danone employees worldwide until 30 June and that there is “extensive coverage” (health, childcare, quarantine) for all employees worldwide.
He added that there would be a specific bonus for all employees working on site during the pandemic.
Finsbury Food Group, the UK bakery-products supplier, today (27 March) warned the coronavirus outbreak meant it could not provide investors with guidance on the company’s earnings.
Nestlé, the world’s largest food company, has set out what it will pay staff affected by “temporary stoppages” caused by the coronavirus outbreak.
Orkla has announced it will provide a “preliminary sales update” for the first quarter of 2020 on 17 April “in light of the Covid-19 situation”.
The company’s full first-quarter results will be announced on 5 May.
PepsiCo has re-opened a temporarily closed Frito-Lay plant in the US. The food and beverages giant had shut its Frito-Lay snacks plant in Modesto, California, after a number of employees showed signs of coronavirus systems but it has now reopened.
The company said it took precautionary steps to identify and notify individuals who had worked closely with the affected employees who went into self-quarantine for the required 14 days on full pay, according to a statement.
After conducting “deep cleaning” of the site it reopened on the 25 March and all staff that could not go into work during the closure will also receive full pay. A spokesperson for PepsiCo would not reveal the length of time the plant was closed for.
European dairy giant Arla Foods has issued a Covid-19-related message to its farmer-owners and the wider market.
Peter Tuborgh, CEO of the Denmark-based cooperative said: “I have been in the dairy sector throughout my working life and have experienced quite a few crises. But this one is absolutely unparalleled.”
He said the business has two main priorities during this crisis.
“The first is to protect the health and welfare of our employees – ie. both the employees at Arla’s farms and colleagues who work at our dairies, in the distribution and in our offices. We follow the guidance of national health authorities and governments and have taken the necessary measures to protect our employees,” he said.
“The second is to keep our production going – to secure our supply chain so that we continue to collect milk from all our farmers and maintain a steady flow of dairy products to customers and consumers.”
Tuborgh said the company is prioritising the supply of the products that are most important to people at this time.
“As the virus peaks around the various countries and regions, we expect our system to be further burdened. We constantly monitor and manage potential risks, have solid action plans in place and are confident that our core activities will continue to be stable,” he said.
Netherlands-based Vion Food Group has said in its outlook for the rest of this year that coronavirus is creating “major uncertainties” in the foodservice part of its business.
The group, best known for its meat products but which has recently moved into the plant-based arena, said in a market update that the outbreak has created a major change in consumption patterns as people are no longer eating out but are eating at home.
“The sale of meat to restaurants and hotels has come to a standstill, while deliveries to supermarkets have significantly increased. The turnover of convenience meat products, such as minced meat, is increasing in comparison to more luxurious products,” it said.
“These shifts have a major impact on the valorisation of meat, causing the relationship between purchase and selling prices to shift as well.”
Vion said it is doing everything in its power to responsibly continue production and is “working in close cooperation with governments in the Netherlands and Germany to keep the supply of food up to par during this crisis”.
Across our portfolio of publications, today we’ve kicked off a round-up of the key, global, political developments in response to the outbreak.
The daily digest also includes need-to-know commentary from international political and economic institutions.
And, importantly, it’s free-to-read.
UK meat processor Moy Park has seen workers at one of its plants stage a walkout over Covid-19 safety fears.
The Northern Ireland-based company, owned by US poultry giant Pilgrim’s Pride, said 100 workers downed tools to stage a 15-minute walkout at its Seagoe, Portadown, plant yesterday (25 March), although trade union Unite claimed the figure was closer to 1,000.
Müller, the German dairy giant, is looking to take on an additional 300 employees in the UK and Ireland to cope with extra demand during the Covid-19 outbreak.
2 Sisters Food Group is hiring “several hundred” workers across its UK-based businesses – poultry, bakery and meal solutions – to cope with the upsurge in demand from coronavirus.
Brazilian meat giant JBS has said it does not see any major impact from having to switch business from foodservice to retail.
Responding to analysts’ questions in a post-2019 results conference call, the company – which revealed that 10% of its global business is in the foodservice channel – said the drop off in foodservice business as a result of the Covid-19 outbreak will have no impact on margins “as long as total consumption does not change”.
It added: “In Brazil, for example, where we make hamburgers for the chains, when they reduce the volumes we can transfer that easily to retail.”
Nestlé has joined forces with charities the International Federation of the Red Cross and Red Crescent Societies in a response to Covid-19.
In a statement, the Switzerland-based food giant said: “We care deeply for people and for the communities in which we operate, and we have an essential role to play during the Covid-19 crisis. Food and beverages help keep people healthy and enhance their quality of life. We care about our responsibility to provide good nutrition, especially for the most vulnerable in society – children, the elderly and those struggling with illness.”
Nestlé also said it is “working tirelessly” to ensure that supply is maintained. It said it has implemented enhanced safety measures at all its sites, with particular focus on frontline workers in its factories, quality labs and distribution centres.
“Also, where needed, we are offering free meals and transport for staff to help reduce the risk they fall ill. In addition, we have put in place generous sick leave arrangements for those who contract the virus and will provide cash loans or advances for those in financial distress,” it said.
This afternoon, we ran a piece featuring four SMEs operating in the UK asking what impacts they have felt from the outbreak so far and how they are trying to adapt.
You can read the piece – for free – below:
Investment research company Sanford Bernstein has reported that US-centric food companies are experiencing a “major surge in demand” as panic buying has led to surging sales growth across the country.
UK-based Hilton Food Group has announced a delay in the publication of its annual results as a result of coronavirus but said all its facilities remain open despite the crisis. Hilton is the first UK food group to delay the release of its results since the regulator, the Financial Conduct Authority (FCA), wrote to companies intending to publish preliminary financial statements in the next few days asking them to delay their planned publication because of Covid-19-linked uncertainty.
Keytone Dairy said it is experiencing a surge in demand for its milk powder products both from its branded customer base and also private-label clients in the New Zealand-based firm’s domestic and international markets.
London-based baby food and infant formula firm Piccolo has opened an online ‘shop’ to help parents who are struggling to buy baby and toddler nutrition products from their usual retail outlets because of Covid-19-linked pressure on supplies. The company’s products can now be ordered directly from its website.
Australia’s Beston Global Food Co. said it is continuing to experience solid demand for its products notwithstanding some down-turn in activity in foodservice outlets across the country in response to the Covid-19 pandemic.
It said retail demand is strong for mozzarella cheese and for meat products produced by its Provincial Food Group in particular, through supermarkets and home delivery services.
The company recorded revenues of AUD51.2m (US$30.9m) in the first half of this 2019-20 financial year and expects revenues in H2 to be “at least of the same order, pending any unforeseen consequences from the current pandemic”.
Foodservice distributor US Foods has announced it is reducing costs because of the impact the Covid-19 outbreak has had on the channel.
CEO Pietro Satriano said: “While the full business impact of Covid-19 is not yet known, we are taking immediate action to reduce our costs to match the slowdown we’re seeing in restaurant, hospitality and education case volume. We are also leveraging our supply chain resources to support the retail industry as they experience unprecedented increases in consumer demand.”
US Foods said it believes its strong balance sheet will enable it to weather the economic impact of Covid-19. It has drawn US$1bn under its existing revolving credit facilities to retain as cash on hand.
Anglo-Dutch consumer goods giant Unilever has pledged to help customers and suppliers that are struggling because of the Covid-19 outbreak. In an announcement today, the Marmite and Ben & Jerry’s ice cream maker said it will offer EUR500m (US$541.5m) of cash flow relief to “support livelihoods across its extended value chain”.
As a responsible, purpose-led business, @Unilever is ready, more than ever, to do everything we can to help fight the Covid-19 crisis. These are the actions we’re taking to help keep communities safe and well: https://t.co/fG6Tue66Zl
— Alan Jope (@alanjope) March 24, 2020
Some less-than-good news from Aryzta this morning, with the bakery giant saying it now expects a “material impact” on its business this year from coronavirus as market conditions and “prospects” have worsened over the past week or more.
A survey of UK-based food industry SMEs found they are increasingly pivoting to e-commerce as retailers de-prioritise their products to concentrate on core offerings during the Covid-19 crisis.
London-based consultancy Young Foodies questioned senior brand representatives from 45 small- and medium-sized food businesses and found SMEs are dealing with major challenges to their businesses and livelihoods and are concerned they might be faced with a “war-time grocery market” within weeks.
A survey looking at retail shopping habits in the UK during the coronavirus crisis revealed extra demand in supermarkets is largely being driven by people adding a few additional items to their baskets and making more trips rather than shoppers buying the same item in bulk.
US food giant Mondelez International said it expects to hire 1,000 additional “frontline” employees in its domestic market.
US chicken business Sanderson Farms has initiated precautionary measures after one of its employees tested positive for coronavirus.
Tulip, the UK pork processor owned by US meat major Pilgrim’s Pride, is preparing to create temporary job opportunities.
Openings will be available in production roles and “other key roles to provide cover when necessary”, Tulip said.
Rachel Baldwin, the company’s vice president for human resources, said: “Tulip is looking to ensure we have enough people in place to keep our manufacturing sites operating as and when people take time out of work to care for themselves and their loved ones. This is an unprecedented time for the UK food industry and we’d like to thank all of our colleagues and staff across the sector who are doing an incredible job to keep up with the current high demand and keeping shelves stocked across the UK.”
FoodDrinkEurope calls on Brussels to relieve Covid-19 supply chain pressure
Trade body FoodDrinkEurope is asking the European Commission to intervene to relieve supply chain pressure during the coronavirus epidemic.
The body, which represents food and beverage companies operating in Europe, said it has identified five pressure points putting a particular strain on the food supply chain.
FoodDrinkEurope director general Mella Frewen said: “If we act on these five areas now, we believe we can avoid serious disruptions to food and drink supplies to consumers and safeguard our jobs and businesses.”
The UK’s competition regulator has announced plans to set up a Covid-19 “taskforce” to monitor the market and clamp down on firms “exploiting these exceptional circumstances”.
“The outbreak of Covid-19 is an unprecedented and rapidly evolving challenge that has prompted many concerns that businesses might exploit the situation to take advantage of people, for example by charging excessive prices or making misleading claims about their products,” the Competition and Markets Authority (CMA) said.
“The Covid-19 virus, and the measures taken to suppress its impact on public health, are likely to have a substantial impact on competition, with the risk of an increase in consumer detriment.”
On Friday, the CMA issued an open letter to the food, drink and pharma industries, revealing it had “received reports that a minority of firms in your sector are seeking to capitalise on the current situation by charging unjustifiably high prices for
essential goods or making misleading claims around their efficacy”.
The CMA said: “We are sure that you share our concerns not just about the unacceptability of such practices in the current circumstances, but also the risk of undermining public trust more widely across these sectors. If appropriate, the CMA has recourse to a range of competition and consumer powers to tackle bad behaviour. It is therefore vital that any poor behaviour is nipped in the bud now and we will use all of the powers available to us to ensure that markets continue to work well during the coronavirus outbreak.”
The Consumer Goods Forum, a network of 400 of the world’s biggest consumer goods companies including Nestle, Danone and Kellogg, has cancelled its annual summit.
The four-day event was due to take place from 16 to 19 June in London.
“It is not a decision we have taken lightly but, given the pandemic that is impacting our industry and the people we care most about, we felt it is the right thing to do,” The Consumer Goods Forum said in a statement.
“We would like to take this opportunity to stress that this is not going to stop us bringing members together. The Global Summit may well be the flagship event for our industry, bringing together over 1,000 CEOs and c-suite executives, but we firmly believe that the need for collaboration and knowledge sharing has never been higher. We will, therefore, look at how we continue to bring members together virtually and help ensure momentum around our key strategic initiatives, as well as on mitigating the impact of Covid-19 on our supply chains and stores.”
PepsiCo plans to take on 6,000 new workers over the “coming months” to meet the extra retail demand from the Covid-19 outbreak as the food and beverages giant announced compensation packages for its US-based employees.
The packages will apply to more than 90,000 “frontline” staff at its beverages and food divisions across North America and “consists of a minimum of an incremental US$100 per week for full-time employees over the next month”. The additional full-time workers will be offered full company benefits, PepsiCo said in a statement.
US foodservice supplier Sysco turns focus onto retail
Sysco, the US foodservice distribution giant, has turned its attention to the retail grocery market as a result of the Covid-19 outbreak.
As so many foodservice outlets have been forced to close as a result of the outbreak, Sysco has been forced to look again at its business model.
Cloetta, the European confectionery supplier, has pulled plans to issue a dividend to shareholders, warning the risk of a “negative financial impact” on the business “from the end of March has increased significantly”.
The company added: “Given the current uncertainty due to the global outbreak of Covid-19 and potential governmental response, it is not at this point possible to predict the full potential impact on our business. However, with the rapid spread of the coronavirus now heavily impacting markets where Cloetta has a presence and the currencies the group is exposed to, we believe that the risk of adverse effects has increased significantly.”
Meanwhile, food major 2 Sisters Food Group has announced it has job vacancies across its processing sites in the country.
In a series of tweets issued on Friday (20 March) and this morning, 2 Sisters said it had either temporary or permanent (or both) openings at eight plants.
At our poultry processing site in West Bromwich, (Site D) we have a number of temporary vacancies. For more details please contact Staffline: Leon.Zukovskij@staffline.co.uk or ring 07843601742 pic.twitter.com/YF9kFtDyKo
— 2 Sisters Food Group (@2SFGofficial) March 23, 2020
Ireland’s farmers have described the decision by McDonald’s to close its outlets in the country and in the UK as a “big blow” to the Irish beef sector.
“McDonald’s is an important buyer of Irish beef. Their closure is a big blow to the sector,” a statement from The Irish Farmers’ Association read.
“Unfortunately, it is reflective of what is happening across Europe where closures have had an impact on the food service sector. However, some of this has been mitigated by an increase in retail demand.”
A number of major retail and foodservice names have, in the last couple of days, announced plans to temporarily close, including UK coffee-shop chain Costa.
Paul Pomroy, the CEO of the McDonald’s business in the UK and Ireland, said yesterday: “Over the last 24 hours, it has become clear that maintaining safe social distancing whilst operating busy takeaway and Drive Thru restaurants is increasingly difficult and therefore we have taken the decision to close every restaurant in the UK and Ireland by 7pm on Monday 23rd March.
“We have not taken this decision lightly and know that our restaurants have been playing an important role in the community providing hundreds of thousands of free drinks to frontline health and social workers and emergency services personnel.
“But I have been clear throughout this that we would only continue to operate whilst it was safe for our people and together with our franchisees, we feel now is the time to make this decision to temporarily close.”
Dairy giant Fonterra is among a growing number of food and beverage companies using their production for the manufacture of hand sanitisers.
The New Zealand dairy giant said it is increasing its production capacity for making ethanol.
We’re doing everything we can to keep our people and communities safe. To help out with the current hand sanitiser shortage we’re providing 250K litres of high-grade ethanol to New Zealand companies, and working with the Government to prioritise where that should go. 1/2
— Fonterra (@Fonterra) March 22, 2020
We’re increasing capacity with a target of producing an extra 220K litres of ethanol. We’re also working with Gull to test 250K litres of their fuel-grade ethanol to ensure it can be used for hand sanitiser. 2/2
— Fonterra (@Fonterra) March 22, 2020
J&J Snack Foods has warned the impact on its sales from coronavirus could be twice as severe as earlier estimated as more and more foodservice outlets in the US close temporarily to curb its spread.
Nasdaq-listed J&J Snack Foods is now warning two-thirds of its sales to restaurants, schools, stadiums and arenas, movie theatres and amusement parks could be affected based on annual revenues of $1.2bn, compared to a previous estimate of one third, as more venues close their doors.
New Zealand-based Manuka honey maker Comvita has put capital raising plans on the back burner as demand for its products has noticeably increased in recent weeks.
The company suggested products “considered to support general immunity” are in greater demand because of the coronavirus outbreak.
In an interview with just-food, Greg Steltenpohl, the CEO of US dairy-alternatives business Califia Farms, set out the impact the outbreak is having on the company.
“The mechanics of the business demand for the particular category we’re in is really unprecedented,” Steltenpohl said, reflecting on the US market for plant-based milks. “We have never seen logistically anything like this before in terms of the need to ramp up production. Our largest distributor asked for four times the usual orders this last week for our top-selling plant-milk SKUs.”
And Steltenpohl believes Califia Farms – which secured US$225m in investor funding in January – and the wider plant-based market could see longer-term gains from the crisis.
“Once things normalise here, our product will probably be even more in demand. I mean, as people have pondered the origin and vectors of not just Covid-19, but the whole series of these types of viruses, they’re coming to understand the animal-base vectors or origin points, so it’s given people a lot more awareness of their own personal health,” he claimed.
You can read the full interview with Steltenpohl here.
US cereal giant Kellogg is the latest food major to announce a recruitment drive in the UK in an attempt to keep up with increased demand linked to the Covid-19 epidemic.
UK food start-ups network and consultancy Young Foodies has criticised a decision by some supermarkets to de-list the products of small brands to concentrate on core product offerings during the Covid-19 outbreak.
Theadora Alexander, co-founder of the organisation, which represents more than a thousand food and drink SMEs, said: “Principally, we understand the move and we are not expecting business as usual by any stretch, but if Morrisons is going to be taking small suppliers off the shelf and putting them at such severe business risk, it should be up to the retailer to provide them with the income continuity. They will be making their sales elsewhere so they will be able to. We cannot have a black and white case of winners and losers.
“We believe that that is the responsibility of the retailer, as per GSCOP [Groceries Supply Code of Practice], to offset any losses as a variation from trade. It’s then up to the retailer to decide whether they need additional support from the government on this matter.
“For now though, there has to be a near-term plug gap on the brands’ side to protect them.”
UK chilled pastry product firm Addo Food Group has announced a recruitment drive. It is seeking temporary employees across its six sites to meet increase demand as a result of Covid-19.
The company, behind the Wall’s and Pork Farms brands, is offering roles to people with all levels of experience within its Spalding, Nottingham, Market Drayton, Shaftesbury and Poole factories.
CEO Deborah Bolton said: “Coronavirus has impacted so many businesses within the hospitality industry already and as workers are being laid off all over the country from restaurants, pubs and bars, we’re pleased to be able to offer temporary positions within our six sites, which may help ease the financial pressure that a lot of people now find themselves in. It’s a really difficult time for people and it’s important that we help where we can.”
The company manufactures savoury quiches, pies, pasties, slices, scotch eggs, sausage rolls and pork pies.
The UK government is temporarily relaxing competition regulations to allow the country’s major grocers to work more closely during the Covid-19 outbreak.
Moy Park, the UK meat processor owned by US poultry giant Pilgrim’s Pride, is seeking “hundreds” of temporary workers to help it meet additional demand resulting from the coronavirus outbreak.
German meal-kit firm HelloFresh is said to be taking on up to 400 temporary staff at its UK distribution centre in Oxfordshire to meet increased demand as a result of coronavirus.
Local newspaper reports said the company, which delivers fresh, pre-portioned ingredients for customers to cook from scratch at home, is experiencing strong growth in its business.
One of the UK’s well-known food industry analysts has said the Covid-19 outbreak could have a profound impact on the country’s food system as demand shifts from foodservice to grocery retail.
The British Meat Processors Association (BMPA) has warned that increased demand for meat as a result of the Covid-19 pandemic could lead to supply issues.
US regulator the Food and Drug Administration (FDA) has said it plans to focus on the safety of regulated products during the current crisis and is postponing its routine inspection of manufacturing facilities.
“Now more than ever, the American people are depending on us. We must ensure our workforce remains healthy to carry out the FDA’s critical public health mission to keep Americans safe,” it said.
“In keeping with the White House Coronavirus Task Force and cross-government guidance, this week we directed all eligible FDA employees to begin teleworking. While this does not apply to those carrying out non-portable activities, such as certain lab activities or the monitoring of imported products, we will continue to adjust our approach to a number of activities, including facility inspections for all FDA-regulated products such as food, animal feed, drugs, biological products, devices and tobacco.
“Earlier this month, we announced that we are postponing most foreign facility inspections through April and that inspections outside the US deemed mission-critical will be considered on a case-by-case basis as this outbreak continues to unfold.
“Today, we’re announcing that for the health and well-being of our staff and those who conduct inspections for the agency under contract at the state level, and because of industry concerns about visitors, we have temporarily postponed all domestic routine surveillance facility inspections.”
UK fresh food supplier Bidfresh is adding direct-to-consumer home delivery services from its depots around the country in response to the national measures introduced to address the coronavirus outbreak.
The public will be able to order meat, fish and seafood, fruit and veg, dairy and a range of other products. The free delivery service will operate in selected postcodes around the depots and will run alongside Bidfresh’s established business with chef and caterers.
China’s dairy imports are likely to decrease at a double-digit rate this year primarily due to a drop off in demand as a result of Covid-19, according to Rabobank, which predicts the virus and falling oil prices will trigger a global recession.
European food and agri-food bodies FoodDrinkEurope, Copa-Cogeca and Celcaa have issued a joint statement saying that food supplies are facing some disruption at the border.
The organisations said their members are reporting increasing difficulties in their business operations.
“Delays and disruption at country borders have been observed for the delivery of certain agricultural and manufactured products, as well as packaging materials. There is also concern over the movement of workers, notably due to certain border closures and travel restrictions, as well as potential labour shortages as staff follow national movement restrictions to mitigate the crisis,” the statement said.
Synlait, the New Zealand-based dairy and infant-formula manufacturer, said it is experiencing “pressure on the broader supply chain” as a result of the Covid-19 outbreak.
Finland-based food manufacturer Fazer has started negotiations with some staff over temporary lay-offs as a result of the Covid-19 outbreak.
Fellow Finnish food group Raisio has cancelled its annual general meeting that was due to take place on 24 March, “based on the announcement by the Finnish government on the coronavirus situation”, A new date for the AGM has not yet been set.
UK online grocer Ocado has suspended its online food delivery service, blaming higher demand than it can meet.
Ocado said that while existing customers with orders would still receive them, it was experiencing a “simply staggering amount of traffic” to its website and more demand for products and deliveries than it could deal with.
Tesco CEO Dave Lewis said we find ourselves in “uncharted waters”.
In a statement, the UK’s largest supermarket’s boss said: “Covid-19 is bringing a change to the UK and it’s clear that lots of things are going to have to shift around in order to help us cope.
“At Tesco, we have been doing everything we can to keep business as usual, but we now have to accept it is not business as usual. In the last two weeks, we have seen significant and prolonged increases in demand across all of our stores and this is leading to shortages in some products for some customers.
“Reacting to the latest government announcements, we have to plan on this situation being the new normal and we will do all that we can to make the food you want available, but we need your help.”
He outlined changes including a store-wide restriction of only three items per customer on every product line, night time closures to allow for re-stocking, elderly and vulnerable only shopping slots and removing multi-buy promotions.
All meat, fish, deli counters and salad bars are to be closed to allow staff to be moved into other parts of the retail operation.
General Mills said its Asian sales for the third quarter were impacted by the Covid-19 outbreak after the US food major hinted last month that revenues from its Häagen-Dazs ice-cream shops in China would be disrupted.
Analyst Sanford Bernstein is “tactically upgrading” a number of US food firms because of coronavirus-related sales.
Conagra Foods, Campbell Soup Co., General Mills, Kraft Heinz and JM Smucker have been moved from underperform to market-perform by the firm which is expecting a coronavirus-related sales lift and broader economic uncertainties to support stock valuations in the near term.
“On near-term coronavirus implications, based on the latest weekly Nielsen data (week ending 7 March), canned soup, pasta, peanut butter, RTE cereal, and granola bars are among the categories that experienced the most significant incremental sales growth (~10-20%) due to coronavirus-related pantry loading,” it said.
Science in Sport, the UK-based nutrition products manufacturer, said it has experienced a sharp reduction in revenues in Italy as a result of the coronavirus contagion, which has prompted that government to put the country into lockdown.
US-based Hormel Foods has reported that it has taken “prudent action” to protect its business from the spread of coronavirus.
Ireland-based private-label food manufacturer Greencore has said its supply chain and production network remains “fully operational” despite the coronavirus outbreak but the impact on its results remains uncertain.
Bubs Australia said it has boosted production capacity and increased shift rotas to meet a rise in demand for infant formula as a result of the coronavirus outbreak and is also building inventories to cater to any further “surges” in orders.
UK supermarkets have announced further measures to help deal with the coronavirus threat and to prevent customer stockpiling.
Tesco, the country’s largest grocer, is to close its 24-hour stores overnight to allow for re-stocking while Sainsbury’s is the latest retailer to put a limit on the number of purchases of certain items. Morrisons has said it will take on an extra 3,500 staff to increase its home delivery capability and reiterated its intention to pay small suppliers immediately. A number of retailers have introduced special shopping hours for the elderly to ensure they can get the groceries they need.
US chicken giant Sanderson Farms has taken robust measures in response to the coronavirus pandemic. They include prohibiting employees and members of their households from travelling for personal reasons outside the US.
Supermarkets in the UK, including Tesco, Sainsbury’s, Asda, and Aldi have put rationing restrictions on certain items sold in store over the growing pandemic of coronavirus.
Freshfel Europe, the Brussels-based association representing fresh fruit and vegetables producers, said it is working with its members to ensure supplies amid the coronavirus pandemic, which has seen some countries close restaurants and other outlets to curb its spread.
Midsona has increased production as the Sweden-based organic food business has seen increased demand due to coronavirus, with sales of some items up 40% in the first two weeks of March.
Food business entrepreneur John Stapleton, who built up and sold brands New Covent Garden Soup Co. and Little Dish, outlines a number of steps SMEs can take to help them survive coronavirus.
Impossible Foods, the US business which makes plant-based burgers and faux pork products, has raised around US$500m in a new fundraising round. It said the funding will help it to fight off the threat of coronavirus.
Murray River Organics, the Australia-based dried fruit snacks producer, said it has “experienced delays to shipping and orders” in February and March as a result of the coronavirus outbreak but is unable to put a financial estimate on the impact.
Kraft Heinz and Cloetta have both asked some employees to work from home in an attempt to lessen the impact of the coronavirus outbreak on their operations.
The British Meat Processors Association has postponed a conference due to be held in London tomorrow (17 March) because of “public health and safety issues” related to the coronavirus outbreak.
J&J Snack Foods, the US food business serving retail and foodservice channels, has warned its sales could be impacted by coronavirus as fewer consumers eat out.
Tesco, the UK’s largest grocer, has sought to reassure consumers that its food supply pipeline is robust despite reports of coronavirus-linked panic-buying.
Brazilian meat processor BRF said its factories are operating normally but has put protocols in place to tackle any eventualities emerging from the coronavirus outbreak, which has now been declared a pandemic by the World Health Organization.
Supermarkets in Italy will stay open through the coronavirus crisis, with a government official saying the country’s food manufacturers are working flat out to ensure supplies.
Premium Brands Holdings, the acquisitive Canadian food firm with businesses stretching across cured meats, meat snacks and seafood, said it is starting to see the impact of coronavirus on sales.
The Global Berry Congress, which brings together fruit producers from around the world, has been postponed due to the spread of coronavirus in Europe.
Seafood Expo Global and Seafood Processing Global has become the latest victim of the coronavirus outbreak as organisers cancelled the event due to be held in Brussels next month.
The UK government has said it is confident that the UK’s food supply will not be interrupted by the coronavirus outbreak.
Switzerland’s Bell Food Group has postponed its 2020 annual general meeting as a result of the coronavirus outbreak. The meeting was scheduled for 17 March but has now been put back to 12 May.
Tesco, the UK’s largest supermarket, has started rationing of certain products, including some foodstuffs, to deter consumers fearing coronavirus-linked shortages from stockpiling goods.
The coronavirus outbreak has led Netherlands-based dairy major FrieslandCampina to reassess how much it sees its core sales growing in 2020.
US food giant Campbell Soup Co. has said it is increasing the production of its soup products in anticipation of coronavirus-linked stockpiling.
Seafood Expo North America/Seafood Processing North America is the second major US trade show in as many days to be cancelled because of the outbreak of coronavirus.
An analyst covering the food industry has suggested that the coronavirus outbreak could turn out to be a net positive for the sector’s stocks.
Expo West, the US new products show, has been cancelled at the last minute as a precautionary measure against the spread of the coronavirus disease.
Canada-based seafood firm High Liner Foods has said it has taken action to reduce its reliance on Chinese supplies in light of the coronavirus which originated in the country.
Switzerland-based food giant Nestlé has asked staff not to embark on international business travel due to the coronavirus outbreak, which has affected almost 50 countries.
Bakkavor said the coronavirus outbreak in China is having a “significant impact” on the private-label firm’s international business after reporting a “weak” performance in its domestic UK market, which generates the majority of revenues.
New Zealand’s Fonterra said it could feel the impact of the coronavirus outbreak in China on its foodservice division, but for the time being, the world’s largest dairy cooperative is maintaining its full-year earnings guidance.
Danone has outlined how coronavirus might affect the French food and beverage giant’s sales performance in the first quarter.
Italy’s food sector is at risk of major disruption from the outbreak of coronavirus in the north of the country, national farmers’ association Coldiretti has warned.
Italy’s food industry is monitoring the coronavirus cases in the country and the reaction to the outbreak with “great apprehension”, trade association Federalimentare said today (24 February), warning of the possible impact on the economy and to food exports.
The coronavirus outbreak in China has forced Mexico-based bakery behemoth Grupo Bimbo to temporarily close a plant in the city of Wuhan, where the disease emerged late last year.
Salmon farmers in Chile are starting to kick-start exports to China again after suspending shipments amid a drop in demand linked to the coronavirus outbreak.
US food major General Mills risks seeing its sales decline in Greater China after reporting almost half of its Häagen-Dazs ice-cream shops have been temporarily closed due to the coronavirus outbreak.
Kerry Group has issued guidance for its new financial year that factors in a potentially significant decline in earnings from the coronavirus outbreak in China.
A report from a US investment bank has suggested that China may look to restructure its meat industry following the outbreak of African swine fever (ASF), avian flu and the more recent coronavirus.
Nestlé, the world’s largest food maker, has issued an update on how it has so far reacted to the coronavirus outbreak in China.
The coronavirus outbreak in China will hit sales and profits in food-related industries such as retail and entertainment for “several months”, a wide-ranging report from Moody’s has warned.
Australia’s Jatenergy is raising production of lactoferrin-based dairy products to meet increased demand from China, which the company believes is linked to the coronavirus outbreak.
Mondelez International has been asked by Beijing to keep two of its plants shut beyond the usual period of closures over Chinese New Year due to the coronavirus outbreak.