Who Will Be Most Impacted By Global Food Shortages?

Last Week’s Moves

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Welcome to your weekly food & beverage report, where we cover everything you’ll need to know for the week ahead. This week, the world’s food supply is beginning to face challenges stemming from Russia’s invasion of Ukraine, food delivery services try to navigate a changing landscape, and the plant-based meat sector sees an unexpected development. 

Global food supply hangs in the balance as Russia’s war in Ukraine rages on

One day following the Russian invasion of Ukraine, Lebanon’s economy minister informed the country of 6.8 million people that they had enough wheat reserves to last one single month. Last year alone, Ukraine exported over $72 billion in agricultural products around the world. Lebanon imports around 80% of its wheat from Ukraine. Warnings of the agricultural impact of the war have been circulating since the beginning of the invasion; the stark implications have set in, creating food shortages around the world.  

• Ripple effect… In the weeks following the invasion, food prices across the globe shot up, supply chains were further crippled, and countries are reeling trying to feed their people. The World Food Program (WFP) has had to tighten food rations for 4-5 million people who rely on the organization for help.
• Planting isn't the priority… Planting season has officially commenced in Ukraine, however many Ukrainian farmers are on the front lines fighting for their country, not tending their crops. President Volodymyr Zelensky has urged non-displaced farmers to plant as much as possible in the spring, though the UN has issued warnings that Ukraine may not be able to harvest crops, plant new ones, or sustain livestock production.

Although the global food supply is facing strain like never before, there’s a different story in the US. Despite US food prices rising at historic rates (and predictions for a further 4% price increase by the end of 2022), experts don’t expect food shortages to extend to the United States. 

• Exports on the rise… “It’s important to realize that the US doesn’t import very much from Ukraine,” said Joseph Glauber, a senior research fellow at the International Food Policy Research Institute. US Agricultural exports for 2022 are seeing record high forecasts, up $8 billion, bringing the total projections to $183.5 billion in exports this year alone.
• Nothing new… Scott Irwin, chair of agricultural marketing at the University of Illinois Urbana-Champaign, told CNBC last Thursday, “We may see some shelves that are empty for various kinds of food products like we have for a while now as we recover from the pandemic, but I can say with some real confidence that in the United States, the average consumer is not going to see a shortage of bread because of what’s going on in Ukraine.”

Post-pandemic food delivery services are facing a changing landscape

Lockdown? Order in… Food delivery stocks were of the few lucky companies that saw a major boost as the pandemic unfolded, offering a way for consumers to still enjoy and support their favorite restaurants. However it appears that their heyday may be coming to an end, as this past week saw significant losses across four major food delivery stocks, including an 8% drop for Just Eat Takeaway.com (JTKWY), the owner of Grubhub.

• Speedy sale… After just barely one year of ownership, Just Eat Takeaway.com is considering selling Grubhub, exploring both full and partial options. Facing increasing pressure from investors, Just Eat Takeaway’s board stated in a trading update last Wednesday, “management is currently, together with its advisers, actively exploring the introduction of a strategic partner into and/or the partial or full sale of Grubhub.

Take me out to the grocery store? … The popular grocery delivery service Instacart has recently announced its partnership with Aramark Sports + Entertainment (ARMK). Instacart will be implementing its Caper Counter technology, an AI powered point-of-sale-system, in Boston’s Fenway Stadium. 

• Home run… These new Caper Counter checkout systems will provide fast, contact-free transactions of food and beverage selection for fans through visual recognition and AI technology, reducing overall transaction times.

While you’re here, check out the latest episode of our new podcast The Food Biz, streaming across all podcast platforms. If you have any feedback or input, reach out to us at news@barchart.com. We’d love to hear what you think!

Other stories…

• PG-16 rating?... Unilever (UL) has announced it will stop marketing food and beverages to children under 16 across both traditional and social media platforms (globally the standard is 13 or older).
• A different kind of smoked meat… Israeli startup BioBetter has created a genetic modification for tobacco plants to produce inexpensive plant-based proteins that can grow cultivated meat.
• Shortage shakeup… General Mills (GIS) is reformulating products in its portfolio to keep them on shelves as certain ingredients face shortages.

That’s all we have for you this week, do you have anything for us? We’d love to hear from you with stories or recommendations for new sections to include! Drop us a line at news@barchart.com with any feedback or input.