Archive For The “News” Category
Over 70% of U.S. households ordered groceries — including fresh produce — online in 2021, at least once.
The U.S. online grocery market captured $8.9 billion in sales during December as more than 69 million households shopped online for groceries, according to the Brick Meets Click/Mercatus Grocery Shopping Survey .
December’s results increased annual online grocery sales to $97.7 billion for 2021, as more than 70% of U.S. households, or 93 million, received one or more orders during the year, according to a news release.
Brick Meets Click conducted the survey on December 29-30, with 1,836 adults, 18 years and older, who participated in the household’s grocery shopping. Responses are geographically representative of the U.S. and weighted by age to reflect the national population of adults according to the U.S. Census Bureau.
Even though most grocery retailers used third-party delivery platforms when they began selling online, the U.S. is a pickup-dominant market. That dominance continues across markets of all sizes, except in some of the largest urban markets where delivery overtook pickup for the first time in December 2021.
Full-year results for 2021 showed that the pickup segment grew its share of online sales to 45%, up 5 percentage points versus 2020, while delivery’s share remained basically unchanged at 33% and ship-to-home’s share dropped 5 points to 22%.
“If retailers are surprised by these results, it’s likely because they are missing a broader view of how and where customers are shopping online for groceries,” Brick Meets Click partner David Bishop said in the release. “Even before the pandemic started, pickup was preferred over delivery. Then in April 2020, pickup took the top spot away from ship-to-home, and it’s kept that spot ever since.”
For 2021, the average number of orders placed by Monthly Active Users (MAUs) held relatively steady at 2.74 per month, down just 1% versus 2020. However, the volatility in 2021’s monthly order frequency dropped 60% versus 2020 levels, signaling that buying patterns are becoming more entrenched at a level that is 35% higher than pre-COVID levels, according to the release.
When 2021’s online share of total grocery spending is adjusted to exclude ship-to-home because most grocers do not offer this option, the results reveal that the combined pickup and delivery segments captured 10% of total grocery sales, up 2 points from 2020.
Throughout December 2021, the share of grocery’s monthly active users who also placed at least one online order with mass retailers jumped to 29.1%, setting a record high for this shopper metric. For these households, cross-shopping with Target rose sharply while Walmart dipped slightly, and the gap between the two retailers shrank to only 2.5 percentage points, the smallest it has ever been.
“The state of online grocery in the U.S. today underscores not only the need for grocers to compete online for sales, but also the imperative to develop and implement more sound strategies that improve profitability as sales growth becomes more challenging,” Mercatus president and CEO Sylvain Perrier said in the release.
That means consumer satisfaction is paramount, requiring operations be efficient for the retailer and to cater to consumers’ quality and convenience demands, he said.
The Port of Philadelphia, PhilaPort, had a record-breaking year in growth in 2021.
The Port saw double-digit growth in containers, breakbulk and overall port tonnage for the year.
Year-to-Date TEU volumes have increased 15% to 739,323 TEUs, with imports growing 16% and export 15%. PhilaPort surpassed its 2020 total TEU count of (640,799), marking another new milestone.
“It has been an interesting year full of challenges and opportunities,” said Jeff Theobald, PhilaPort Executive Director and CEO. “Not only did we surge in container volumes, but some BCOs (beneficial cargo owners) shifted to breakbulk shipments. PhilaPort is one of the only U.S. ports that has several facilities that are purpose-built to handle breakbulk. PhilaPort steel volumes were up 196%, cocoa volumes went up 106% and wood pulp & lumber volumes increased over 10%.”
Breakbulk YTD cargo volumes grew 19% to 1,288,226 metric tons. Breaking our end-of-year volumes from 2020 (previous 1,083,427 metric tons).
Overall Port tonnage YTD volumes grew 10% to 7,062,523 metric tons, crushing the Port’s highest record set back in 2017 at 6,868,747 metric tons.
Other December Cargo Highlights (Year-End Summary):
• Steel Tonnage +196% YTD
• Wood Pulp +11% YTD
• Lumber +11% YTD
• Cocoa Beans +106% YTD
• Vessels +7% YTD
PhilaPort, The Port of Philadelphia, is an independent agency of the Commonwealth of Pennsylvania charged with the management, maintenance, marketing, and promotion of port facilities along the Delaware River in Pennsylvania, as well as strategic planning throughout the port district. PhilaPort works with its terminal operators to improve its facilities and to market those facilities to prospective port users around the world. Port cargoes and the activities they generate are responsible for thousands of direct and indirect jobs in the Philadelphia area and throughout Pennsylvania.
Mediterranean Shipping Co. has become the word’s largest shipping line in terms of capacity, according to data compiled by Alphaliner and published on recently by Bloomberg.
The Danish carrier A.P. Moller-Maersk A/S is no longer the world’s largest container line.
MSC’s fleet can carry 4,284,728 standard 20-foot containers, 1,888 more than Maersk, giving both a market share of 17%.
Maersk, which first entered containerized trade in 1975, has held the top spot for decades. The carrier has been a pioneer in the industry, often breaking records by building the biggest ships.
More recently, it has invested in vessels that can sail on carbon-neutral methanol. It still has the most capacity in terms of owned vessels: MSC has about 65% of its capacity from chartered ships whereas Maersk only has 42%.
After struggling to make money for much of the past decade, the container shipping industry just had its most profitable year ever as pandemic-driven demand for consumer goods strains capacity on vessels. Freight rates out of Shanghai have jumped about five-fold over the last 18 months.
“We never set a specific target to be the biggest,” MSC Chief Executive Officer Soren Toft said in an emailed comment on Wednesday, adding that he’s focusing on growth and profitability.
Maersk CEO Soren Skou last month reiterated in an interview that holding the top spot isn’t important for the Copenhagen-based company, which is investing on expanding its land-based logistics where profit margins are higher.
Chilean fruit exporters are experiencing lower profit margins due to the increased cost of ocean freight, according to the Association of Fruit Exporters of Chile (ASOEX) and the Agricultural Society of Biobio (Socabio).
ASOEX reports rates are increasing considerably in relation to the freight paid the previous two years.
The exporters association notes a U.S. study shows 25 percent of the price consumers are paying corresponds to the freight issue.
This hike has a direct impact on fruit producers and exporters throughout Chile due to freight increases and is one of the fundamental concerns of the industry is specific commodities, such as cherries, table grapes, peaches, nectarines, and kiwis, cannot directly absorb the increase in the cost of the freight.
Socabio reports the cost of freight has risen 30 to 40 percent, which affects the profitability of the exported crops, although it depends on the crop; in the case of fresh fruit, it becomes more expensive to export because it is important to export the crop quickly.
What will it cost to put out that appetizing spread for the Big Game this year? It will cost about 8% to 14% more than 2021, depending on whom you draft to be on your team for one of the biggest food events of the year.
You will need to work on your blocking and tackling for this year’s big game. Your offensive line of carbohydrates and vegetables will need to keep your rampaging snackers from sacking your quarterback of proteins. While the cost of chips and dips, vegetables and other appetizers are up approximately 2% to 5%, they represent your best value to feed those hungry feasters who are all fired up by the clever ads or big plays.
The action on the gridiron will be tame compared with the action on the grill, where prices are up 12% to 18%. Who’s to blame? Just like an armchair quarterback, everyone has an opinion (sometimes powered by the beer or wine, up 4% to 5%). To say the least, it is as confusing as a broken play with three separate penalty flags on the field and instant video challenges.
Let’s work our way through your shopping list:
Chips/dips
Potato chips: In periods of increased supply disruptions and higher food inflation, the humble potato chip offers a stout defense. The U.S. Bureau of Labor Statistics’ (BLS) January pronouncement of inflation(2) shows a subpar increase of 1% versus this time last year. We can thank American farmers’ and food manufacturers’ strong preparation and deft execution for keeping a lid on the price pressure.
Chips/dips
Potato chips: In periods of increased supply disruptions and higher food inflation, the humble potato chip offers a stout defense. The U.S. Bureau of Labor Statistics’ (BLS) January pronouncement of inflation(2) shows a subpar increase of 1% versus this time last year. We can thank American farmers’ and food manufacturers’ strong preparation and deft execution for keeping a lid on the price pressure.
Guacamole/avocados: There is great news in the ever-popular avocado and guacamole category, with food inflation showing about a 1% increase from a year ago3. Most avocados and guacamole come from our Mexican and South American friends. They continue to expand production and execute, keeping the supply ample. Muchas gracias, amigos!
Salsa: Salsa is an all-important complement to the guacamole. It will be more expensive than the chips and the guacamole in terms of price inflation. Salsa is up 6% from last year. Once again, it’s due to labor, packaging, and shipping, rather a lack of chilis and tomatoes.
Veggies
Make sure you stack your offensive line with vegetable all-stars. We’re playing “Moneyball” here for the win. Carrots, celery, and tomatoes (depending on your format and brand) are roughly the same price as last year. Between checking the BLS and Nielsen numbers, we can see that there are lots of options that are flat (or slightly down). As a smart general manager, you should review your options to buy in bulk and prepare them yourself. This requires some prep time before the Big Game, but hopefully your diners will appreciate your Moneyball savvy.
Wings and things
The proteins are where the trouble has shown up in terms of price increases. The grill represents your spending point of pain. There are a lot of moving pieces to the price increases. Is it the “infamous Big Meat”? Or, higher feed costs for all the animals due to corn and soybean spiking close to 100% over that last couple of years? Maybe, COVID’s impact on processing and supply-chain are to blame? Of course, the answer is all those things and more. Your real question looking at the draft board as it stands is, who should you pick with your next draft choice?
Chicken wings: There is nothing but pain in this category. The USDA says prepared chicken wings are up 14% to 26% (bone-in and boneless respectively). The IQF (individually quick frozen) chickens are up 26%. It would seem the IQF is the bigger loser, but that misses the point that they are still $3.57 per pound versus $7.24 (the average) for the prepared wings. Is that the sound of an air fryer I hear? A great call by the GM for drafting a diamond in the rough.
Pork chops: I am moving pork chops up on my draft picks. The BLS is reporting that they are 7% more expensive than last year, but given protein inflation, that makes them a buy. They might not have the cachet of the next item, but steak is packing a world of pain on the pricing front.
Steak: Steak has always been an all-star, but with a 23% price increase from a year ago, is it having a prima donna moment? The BLS shows $11.06 per pound for USDA choice sirloin (versus $8.98 a year ago). The cattle and beef industry is working both structural and temporary issues at this point. The Biden administration has announced initiatives and money to help and regulate the industry. Those could help, but they won’t help this year.
Cocktail wieners: Here’s one that seems popular by different regions, and they are a crockpot powerhouse. The Nielsen data shows them 7% higher than last year. That moves them higher on my draft board. Maybe a couple of extra pounds in the crockpot will help you manage fourth quarter defense against those going back for seconds (or even thirds).
Hamburger: The BLS says ground hamburger is up 17% from a year ago. It’s nation-wide price shows $4.60 a pound. This isn’t nearly as bad as the steak, but it still represents a real commitment. One of the differences for steak versus hamburger is the sourcing and the demand. The U.S. brings in meat to grind into hamburger from Australia and Brazil (to mention the big two), and the U.S. exports high-end cuts to Asia. These market dynamics led to less price pressure for hamburger versus the steaks.
Shrimp on the Barbie
I guess there are two ways to look at featuring shrimp at this year’s big game. It is up sharply from last year’s $3.60 per pound (at the wholesale import level, according to Urner Barry) to close to $4.40 per pound (same index). That’s a 22% increase. However, last year’s price represented a multi-year low due to COVID reducing restaurant demand. Back in January 2018, the index showed the same shrimp being priced at approximately $4.40 a pound. That is about the same price range as today. Now, unless you are buying by the metric ton, you will pay much more at retail prices, but they should move in a relative strong relationship to what we see in the wholesale pricing.
In the cooler
Soft drinks: Food inflation continues to rear its ugly head in the soft drink world. The labor, packaging, and transportation costs are crimping the industry’s ability to match last year’s prices. Here again your general manager skills will need to be applied. According to the BLS, the 2-liter bottles jumped the most by increasing 12%. In contrast, the 12 pack of cans is up 6%. Both represent big jumps compared to general food inflation. Even so, that 2-liter bottle represents a better value if you can get your attendees to agree on the type and flavor.
Beer: The beer industry continues to struggle with modest demand strength and higher input costs. The BLS reports that beer prices are up 4% from a year ago. No doubt, the brewers are facing higher labor, packaging and shipping costs just like the soft drink segment, but the overcapacity in the industry has muted the price increase. Not a bargain like the carbohydrates and vegetables, but it helps the budget.
Wine: The wine industry mirrors the beer industry with its woes. The BLS reports wine prices up 3%, just like beer. Our California wineries and vineyards continue to struggle with much higher labor, water, and transportation costs. However, global supply capacity is making it difficult to pass those cost increases along. This will definitely work in our favor as we prepare for the Big Game.
Tips for keeping costs low
Go for the guac. With avocado prices holding nearly steady since last year, this is a good bang for your buck.
Pick pork. Although prices are up 7%, it’s a bargain for your meat this year. Things to chew on: pork tacos, pork meatballs, and pork sliders.
Bring on the beer. Prices are somewhat stable. Brews will be a good buy for your buck.
As for the Big Game itself, it’s the Cinncinati Bengals vs. the Los Angeles Rams at SoFi Stadium in L.A.
By Gerald Ebert, ALC Richmond
Is the severity of the “supply chain crisis” a direct result of the COVID pandemic? Probably.
Are 15 months of consecutive Year-Over-Year freight cost increases a direct result of COVID and the “supply chain crisis”? That question is not as easily answered.
Most of us in the freight business work in a right here and right now world. We win and lose looking into a crystal ball that has been very cloudy the last few years. We work hard to find commonalities with past trends to help give us even the slightest advantage.
Even with years of experience and more real-time data than ever before at our fingertips, every tight truck market is the “tightest we have ever seen”, while a loose truck market seems to add hours to every day.
As everything these days is a “crisis”, it is not uncommon to hear that the national reopening that followed the COVID shut down was the beginning of the current capacity “crisis.”
It’s true, that average truckload prices did increase approximately 80% from the end of the COVID shutdown through the close of 2020. This trend continued through 2021. Only as 2021 closed, did we see the Year-Over-Year gap shrink to reasonable comparisons.
With all that has happened since we found ourselves adjusting to a new and often unwelcome reality, it’s easy to forget that before The COVID Shutdown, The Great Reopening, The Workforce Shortage, The Supply Chain Crises, and Surging Inflation, there was January, February, and March of 2020.
I recall having numerous, maybe daily, conversations with colleagues in those three months in which we opined, “This the tightest market we have ever seen.” It wasn’t. In fact, it didn’t really come close in comparison to the capacity challenges we faced in June and July of 2018.
The industry, and those of us that work in it every day, were simply conditioned by an unusually long 24 to 26 month cycle of demand and rate decline. It is likely that the COVID pandemic was just an unpredictable pause of the inevitable rebound we are still dealing with today.
2022 is not showing any signs of a downward correction. Most are predicting mild 3-5% increases when compared to 2021. The reality is that we won’t know until the year concludes. That’s the way transportation works. Hindsight is crystal clear. The only thing crystal clear about the future in transportation is that it will be different than it was the previous year.
The market doesn’t recognize any calendar or bid cycle. It doesn’t show mercy for the unpredictable. When the market destroys your budget, it shouldn’t destroy solid relationships that have been built over years.
2021 proved, yet again, that any commodities market is measured by a simple supply and demand equation. From 2018 through 2019, that equation favored the shipper. For most of 2020 through today, and for the foreseeable right here and right now future, it has forced shippers to battle for capacity. Trusted resources and strong relationships have never been more important. That crystal clear hindsight view will verify those relationships.
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Gerald Ebert began his career with Allen Lund Company as a transportation broker in the San Antonio office. In 1999, Ebert transferred to ALC Richmond and was promoted to the manager of the Richmond office in 2000.
Lineage Logistics, LLC, the world’s largest and most innovative temperature-controlled industrial REIT and logistics solutions provider, today announced the strategic expansion of its facility network near the major port in Savannah, GA.
“Savannah is the fastest growing port and largest single container terminal in North America. Lineage’s new facilities in this high-demand location will provide additional capacity and value-added services in a critical market for our customers,” said Greg Lehmkuhl, Lineage’s President and CEO. “We are constantly looking for ways to maximize and further streamline Lineage’s total supply chain, and our meaningful growth in Savannah will offer customers increased access to faster, more reliable distribution opportunities to markets across the Southeast.”
Lineage recenrly announced its plans to break ground on a next-generation facility near the Port of Savannah to handle fresh produce and perishable imports. The Company will invest $62 million in the new building, which, upon completion, will create 65 new jobs in Chatham County’s Port Wentworth, in addition to nearly 100 jobs required for the project’s construction. Operating as a cross-dock, in which product enters one side of the building and exits the other side via truck on the same day, the facility will also provide fumigation, packaging and other value-added services for customers to move fresh product efficiently to markets across the Southeast. Construction is expected to be complete by the end of 2022.
In addition, Lineage announced the Phase I opening of its temperature-controlled warehouse on Tremont Road adjacent to the Port of Savannah. Serving both imported and exported products like poultry, the facility features a 19,000-square-foot blast freezer, a boxing room and customs brokerage capabilities to provide streamlined processing in and out of the port. Once fully operational, the facility will employ up to 100 Georgia residents.
Combined, the newly announced facilities expand Lineage’s presence in the market by more than 500,000 square feet of capacity. In total, the Company’s network will span four facilities in Savannah with twelve facilities across the State of Georgia.
About Lineage Logistics
Lineage Logistics is the world’s largest temperature-controlled industrial REIT and logistics solutions provider. It has a global network of over 400 strategically located facilities totaling over 2 billion cubic feet of capacity which spans 19 countries across North America, Europe and Asia-Pacific.
Plant City, FL – International grower and year-round marketer of strawberries, blueberries, blackberries and raspberries, Wish Farms, is proud to announce the fifth berry to its lineup: Pink-A-Boo Pineberries®.
The trademarked name is a play on words, giving nod to the berry’s ripe pink hue. Pineberries are white in color and turn a pink blush when ripe. It has a strawberry flavor, but with essences of pineapple, pear, and apricot. Since their sugar content is slightly higher, and they have lower relative acidity than traditional red strawberries, pineberries have a delicate flavor finish that leaves the palate pleasantly refreshed.
“I think this new berry is going to be a big winner for Wish Farms, our growers, and our retail partners,” said Wish Farms owner Gary Wishnatzki, “Our entire team is energized, and we are putting on a full court press to make it a success. We have a commitment to a serious marketing strategy that is going to move the needle in the marketplace.”
Pink-A-Boo Pineberries® are packed in a one layer, 10 oz consumer unit. The label features a picture of a ripe pineberry and the phrase “Ripe and Ready” for further emphasis. The branded, bright pink box holds six of these units, and its vibrant color is eye-catching on display.
The pineberry was developed through traditional breeding techniques at the University of Florida. In fact, the red strawberries consumers enjoy today were crossed with a wild white strawberry many years ago. Wish Farms decided to prominently display “NON-GMO” on its label.
Director of Marketing, Amber Maloney: “Shoppers have become conditioned to look for a bright red strawberry, so it is up to us to educate the consumer on this unique addition to their produce aisle. In addition to the call outs on the label and point of sale signage, a robust social media campaign is planned across multiple platforms.”
Last season, retail trials were executed successfully on a small scale. With a ramp up from 6 acres, the company has exponentially increased acreage of Pink-A-Boo Pineberries® in its strawberry growing regions in Florida and California.
Wish Farms is harvesting nearly 100 acres of Pink-A-Boo Pineberries® in Florida from December to April, and 150 acres in California with modest volumes beginning January, increasing through June and into fall.
Wishnatzki: “Our farm teams in Plant City, Duette, Salinas, Santa Maria, and Oxnard have had good experience growing and packing pineberries so I’m confident that it will be a great season for quality and taste.”
About Wish Farms:
Feel Good. Eat Berries. Make A Difference.
It isn’t just a catchy phrase, giving back is engrained in the company culture. Through the Wish Farms Family Foundation, a portion of profits are dedicated to their three pillars of giving: Food Insecurity, Youth Education and Community. With a defined mission, they hope to make the world a better place.
Founded in 1922, Wish Farms is a fourth-generation, family operated company. As a year-round supplier of strawberries, blueberries, blackberries, raspberries, and now Pink-A-Boo Pineberries®, it grows both conventional and organic varieties. Nationally recognized for innovation, Wish Farms utilizes patented traceability technology to ensure quality and safety by tying consumer feedback to specific information from each day’s harvest. For more information, please visit www.wishfarms.com
By Derek Robinson, ALC Savannah
The Port of Savannah is continually breaking record after record, year after year, in both the import and export of goods, throughout the United States and worldwide.
While the United States is known primarily as an importer of goods, the Port of Savannah is known as the top exporting port for containerized agricultural goods. During FY2019, Savannah took that spot, accounting for 15.8% of exports and continues to grow every year. In the first five months of 2020, the port had already handled 593,195 TEU’s and ate up a 12.2% market share, once again exporting more containers than any port in the United States.
2021 certainly brought the phrase “supply chain” into daily conversations at the dinner table, water cooler, and evening news programs. The Port of Savannah has put a few things into play, in order to speed up all facets of the port and move agriculture goods in and out quicker. One of the biggest things to happen was the creation of “pop-up yards” that can handle an additional 500,000 containers throughout the year.
This improvement alone allows drivers to make 70 mile turns instead of 400 mile turns, which increases both daily driver numbers and the ability of drivers to get more home time every day. The Infrastructure Investment and Jobs Act has slated numerous projects to the port that will only continue to add efficiencies to keep the Port of Savannah in that #1 spot for generations to come!
We at the Allen Lund Company move countless loads of produce from the Savannah area daily. Many loads come as an import brought through the port, or from a Georgia farmer working tirelessly to bring you peaches, melons, or pecans.
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Derek Robinson is a business development specialist in the Savannah office and has been with the Allen Lund Company since 2015. Robinson attended Savannah Technical College, specializing in Aviation Structural Mechanics.
Van and refrigerated (“reefer”) truckload freight rates hit new highs in December, with national average prices up 21.9% and 29.5% respectively compared to the same period a year ago, said DAT Freight & Analytics, which operates the industry’s largest marketplace for spot truckload freight and the DAT iQ data analytics service.
National average truckload spot van and reefer rates increased for the seventh consecutive month and the average van rate reached $3 per mile for the first time. Spot truckload rates are negotiated on a per-load basis and paid to the carrier by a freight broker.
DAT’s Truckload Volume Index (TVI) was 236, a 3% decline compared to November when the Index set a record for the number of loads moved by motor carriers in a month. The TVI was up 18% year over year, reflecting strong truckload freight volumes as 2021 came to a close. The number of loads posted to the DAT One load board network increased 13.7% in December while truck posts fell 10.5%. Compared to December 2020, load posts increased 48.8% and truck posts were up 6.9%.
“While it’s not unusual to see a decline in the number of loads moved from November to December, spot-market volume was historically strong last month,” said Ken Adamo, Chief of Analytics at DAT. “Truckers experienced unparalleled demand during the holiday season.”
Van rate up 54 cents year over year
• At $3 a mile, the national average spot rate for van freight was up 7 cents compared to November and 54 cents higher than in December 2020.
• After increasing 17 cents month over month in November, the average spot reefer rate rose 2 cents to $3.47 a mile in December. The spot reefer rate has set a new high for six straight months and is 79 cents higher compared to the same period last year.
• The national average rate for flatbed loads on the spot market increased 2 cents to $3.08 per mile, a 59-cent gain year over year.
Flatbed load-to-truck ratio jumps 36%
• The national average van load-to-truck ratio was 6.5, up from 5.2 in November, meaning there were 6.5 available loads for every available van on the DAT network. The reefer load-to-truck ratio was 14.0, up from 11.9 in November.
• The flatbed ratio jumped to 51.1 from 37.5 the previous month, as unseasonably warm weather extended the construction season.
Contract rates hold steady
The national average shipper-to-broker contract van rate was $2.94 per mile, up 1 cent month over month. The average contract reefer rate fell 1 cent to $3.11 a mile, while the average contract rate for flatbed freight was unchanged at $3.34 a mile.
• The national average diesel fuel surcharge was 40 cents a mile for van freight, down 1 cent from November when the surcharge was at a seven-year high.