COVID-19 Impact Weighs On Food Supply Chain

Food shipments decline over 10% in the last month due to supply disruptions and plant shutdowns

We saw it first in consumer packaged goods. When governments began instituting shelter-in-place orders, the news of toilet paper shortages and frantic runs on hand sanitizer and soap spread far and wide. As we rode out those early weeks of quarantine, our own data confirmed the increase in shipment volume for the CPG industry, which felt the brunt of the supply chain strain more than others.  

But moving out of early March, CPG load volume declined back to its pre-COVID averages. As the pandemic wears on, FourKites platform data illustrate that supply chain impacts are moving upstream, now showing more signs of wear on the food supply chain than in CPG. That’s no real surprise; in recent weeks, hundreds of workers at food processing companies have fallen ill to COVID-19, causing widespread supply chain disruptions. To assess the impact of these supply disruptions in the US, we looked at aggregate load volume across the major food suppliers in the country, across four sectors: meat, dairy, alcohol and pet food. The latest snapshot of what’s happening on the ground provides a more nuanced view of the food supply chain as a whole. 

Here’s what we found: In aggregate, our data points to a 10-15% drop in shipped loads over the past month across meat, dairy, alcohol and pet food. And while that is certainly a significant drop, it’s not quite as precipitous as we expected.

• Total shipment volume across the major meat processing companies in the US declined 17% during the week of April 13 compared to its peak the week of March 23.

Stop Volume by Day Since 1/1/2020

• Correspondingly, load cancelations for meat processing companies – or loads that were planned two to three weeks in advance but then canceled by the customer – reached an all-time high last week, up 9% from the week of April 13 and up 22% month over month. This is especially concerning for the industry and supply outlook.

Load Cancellations Since 1/1/2020

The data confirm the impact of the current health crisis on the national food supply, including meat and poultry, with meat processing load volumes declining even below their typical volume from a couple of months ago. 

The meat distribution story remains incredibly fluid, especially in light of this week’s White House declaration. If food producers bring workers in, we may see distributors and retailers increasing demand on carriers to keep up with escalating load volume. It will inevitably be a local decision based on a multitude of factors, and we will keep close watch on how this story unfolds.

• Load volumes across dairy, alcohol and pet food are also down from their peak in early March, though they have each seen increased volume across the board in the month of April.
• Alcohol, which saw declines from its peak in the week of March 30, saw a sharp increase this week – up 27% from the week of 4/13.

• The personal care and CPG industry has bounced back from its dip in load volume in mid-March, and rebounded strong in April, with load volume consistently higher than it’s been at any other point this year.

Personal Care & CPG Load Volume Since 1/1/2020

We will continue to keep a close eye on these food trends, along with other areas of the supply chain impacted by coronavirus. FourKites analyzes data from millions of loads and real-time machine learning to help shippers and carriers optimize their assets and inventory movements. Check out our dedicated COVID-19 site for the latest.