This is another year when far-out planning will be in order, and expect industries we depend on to sometimes not deliver on time. A state we traveled to recently ran an in-depth story on restaurants that echoes stories we’ve heard repeated many times. Place an ad for help—whether servers, line cooks or bartenders—and schedule interviews. Some 60-70 percent won’t show up for the interview. Hire anyone you can and nearly all don’t show up for the first day of work. Some of the ones who actually show up work for two weeks and quit.
There are several factors involved. In the year where many restaurants and bars were closed all or much of the time, some workers left the industry. Businesses that boomed during the pandemic, like retail grocers or Amazon, hired hundreds of thousands of people, who now are used to regular paychecks and healthcare. They aren’t coming back.
Uncle Sam stacking $1,200/month on top of state unemployment benefits means some folks can make more riding the couch than by working. That will hold through September—if Congress doesn’t extend it again.
Every restaurant in big towns is hiring. Some customers understand, but others complain about long waits for food and servers stretched working too many tables. Hopefully, customers starved for professional cooking, dishes they don’t tackle at home and eating somewhere besides couch-side with the TV, will keep coming back. The stunning price run-up in boxed beef prices indicates they must be coming back for more. The record established during the pandemic-induced shortages last year have been smashed.
Packers are having some of the same problems but with added reasons. With crews short-staffed, working all out during the week for over a year, Saturday after Saturday, and working under COVID-dictated new protocols, extra equipment and spacing requirements just don’t have the capability of pushing at the same pace. We’ve heard some of the biggest plants just can’t achieve top throughput right now.
So, the restaurants and bars that were closed and needed no beef a year ago, now need more than they can get, even paying higher prices because demand exceeds supply. Workers they had to lay off now can’t be persuaded to come back to work.
There are other parts of the economy going through similar catch-22s that will trickle into our puddle. The problem we already had of not enough truck drivers to go around is worsening. There is even talk of fuel shortages on some days caused by delivery problems. Drivers need additional training and certification in addition to a CDL to haul fuel, and there aren’t enough out there certified.
Corn? Some feedlots are having trouble hunting down corn. And dicey weather predictions for this summer raise some concern about just what the new crop outlook will be. But prices will certainly provide incentive for farmers to plant everything they can.
Buy your Christmas presents now. Worldwide container shortages, backups at ports, shortages of port labor and trucks may improve by summer—or get worse if consumer demand keeps increasing—making deliveries of all kinds of manufactured goods delayed. Computer chip shortages are affecting production of cars, trucks, tractors, manufacturing equipment, etc. Lumber shortages are slowing home building, as the sawmills left cannot keep up with demand, even as timber farms aren’t getting prices they need to cover cutting and hauling costs. Cow-calf guys can sympathize.
The moral of the story: When you slam on the brakes and plaster everyone against the windshield and then floor the gas, there is going to be big whiplash. Everyone, including agriculture, is going to have to cope with it for a while. Keep your eyes open and your antennae up. Once again, it is good to be producing something people need and want—food. But expect curveballs galore.
And even though the report that President Joe Biden was going to restrict beef eating was false, the regulations, taxes and death taxes they are contemplating could have much the same effect—unless we raise a big ruckus.
Good news? People are lining up at restaurants and retailers seem to be moving beef at record prices. Quality seems to be holding up. We even discovered—after raving to the restaurant manager about some very tender and flavorful brisket—that Holsteins can make very good eating. Who knew? Haven’t found out yet what they were crossed with, but whatever the bull was, the result was great. — Steve Dittmer, WLJ columnist
(Steve Dittmer is the author of the Agribusiness Freedom Foundation newsletter. Views in the column do not necessarily represent the views or opinions of WLJ or its editorial staff.)