May 28, 2020Frozen fry demand showing positive signs
Signs are showing that frozen fry demand is improving quicker than the industry had anticipated, according to a May 27 report by North American Potato Market News.
The lack of foodservice demand due to COVID-19 shutdowns and restrictions has created a well-documented backup in the potato supply chain. Despite being reduced to drive-thru only in many areas, Wendy’s sales were down just 2.1%, year-over-year, the week ending May 2.
In addition, fry processors moved 112.8 million pounds of freezer stocks during April, which was the largest movement during the month since 1993, NAPMN reported. That may be related to production downtime, however. For example, a Lamb Weston plant in Washington closed temporarily last month due to an employee testing positive for COVID-19. McCain also has confirmed layoffs at Canadian facilities.
Restaurant chain sales in the U.S. improved five consecutive weeks from early April to mid-May, although were still down 21%, year-over-year, the week ending May 17.
Some states are starting to allow sit-down restaurants to reopen, if even at 50% capacity, in areas where the virus is less prominent.
With schools still shuttered and nonessential travel greatly reduced, foodservice demand won’t approach normal for the foreseeable future. There are small signs pointing in the right direction, however.