Retail meat department dollar sales increased 20.7% the week of May 24 versus a year ago and volume grew 5.1%. Those pre-Memorial Day numbers suggest consumer demand continues strong despite an economy damaged by the coronavirus pandemic.
Meat and poultry typically dominate retail promotions ahead of Memorial Day, says Anne-Marie Roerink, president of 210 Analytics, with variety and convenience a lead feature.
“This year, however, tight supply along with price inflation and continued social distancing measures created a very different marketplace and demand,” Roerink said. “Purchase limits remained in place for many popular cuts, all the while more states allowed restaurants to re-open dine-in facilities, altering the demand landscape yet again. Despite the supply pressure, dollar sales grew 20.7% the week of May 24 versus year ago and volume grew 5.1%. The volume/dollar gap widened to 15.6 percentage points.”
Through May 24, meat department dollar sales were up 24.7%, double-digit growth for 11 consecutive weeks, according to IRI, a data analytics and research company. “This reflects an additional $5.8 billion sold versus the same time period in 2019,” Roerink said. “Year-to-date volume sales through May 24 were up 17.3% over the same period in 2019, reflecting an additional 1.2 billion pounds of meat and poultry sold versus the same time period in 2019.”
IRI data shows in point of sale data, the gap between volume and dollar sales was the widest since the onset of coronavirus, at more than 15 percentage points for the week ending May 24 — signaling continued pressure on pricing due to tightness in the supply chain.
“Significant differences are observed when comparing dollar protein shares between the first week of March, reflecting pre-pandemic sales levels, and the week ending May 24,” Roerink said. “While shares are influenced by holidays and differ from week to week, pork and beef’s dollar share continues to be elevated in the one week and year-to-date views, whereas chicken’s share is down in both. The same look at volume shows the effect of pricing, with pork making up a significantly larger share in volume, but beef and chicken down. Beef shares had been tracking ahead, but supply chain tightness pressured the volume share the week of May 24.”
Looking at the weeks ahead, Roerink said the next report for the final week of May will cover the 12th week of coronavirus’ affected shopping. Since mid-March, the closing of schools brought many more meal occasions to at-home, but now the altered consumption patterns will go against summer vacation consumption patterns of previous years. Meanwhile, the relaxation of the stay-at-home executive orders looks different from state to state.
“Many have relaxed mandates allowing some consumers to shop, dine and work out of home,” Roerink said. “The economic recovery along with the foodservice engagement in those states will be very telling for the likely level of demand at food retailing for the foreseeable future. Given the limited seating, economic pressure and perhaps some latent social anxiety, it is likely that grocery demand will continue to sit well above the 2019 baseline, with meat in a starring role.”
Read original article: https://livestockauctioncattle.com/pre-memorial-day-meat-dollar-sales-up-20-7/