Supply Chain and Holiday Food Shortages in 2021 - Procurement Foundry

When we think of the holiday season, usually the first things that come to mind are those associated with abundance: gatherings filled with family and friends, delicious feasts featuring traditional dishes, stockings filled to the brim, and a tower of shiny gifts under the tree. But this past holiday season there were supply chain and holiday food shortages.

Let’s look at some of the impacted areas—and why—and what we can expect as we continue moving forward into 2022.

Supply Chain and Holiday Food Shortages – What Was Missing? 

Even after an initial bumpy road of supply issues plagued the fall of 2020 due to the first onslaught of the pandemic, things seemed to be looking up and stabilizing over the summer. But the holiday season of 2021 be has been hit with similar, dreaded supply issues. So, what exactly did we miss seeing the most on our shelves this holiday season?

Among the most common food shortages we saw included: 

• Canned goods: many linked this lack of supply to the scarcity of aluminum for packaging
• Turkeys: this one hit many hard, with shortages blamed on the number of factories being forced to close during the pandemic, as well as a hike in grain prices 
• Chicken: many fast-food chains were hit hardest with this shortage due to the struggle to find fowl suppliers
• Pet food: the shortage of this staple blamed on the rising prices of its core ingredients, such as corn, soy, and various meats
• Bottled water
• Liquor (many wanted/needed a bit more of that amid it all this year, as many states struggled to keep supply up)

One, perhaps surprising, addition to the list was Lunchables. That revered and nostalgic, easily packable meal practically flew off the shelves once schools and offices began reopening.

The Reasons Behind the Food Shortages

While we have already listed above some of the reasons for food shortages, two main blanket issues have caused most of the distress: labor shortages and supply-chain issues. Demand has skyrocketed (with the pandemic trend of panic buying not helping), while the suppliers have struggled to keep up. 

Restaurants and grocery stores alike have been impacted by supply chain and holiday food shortages. 

What Will Happen in 2022?

While shortages don’t seem to be as dire as they were at the beginning of the pandemic, experts agree that they don’t seem to be going away anytime soon. Specifically, food suppliers are hunkering down (and working on planning as much as possible) for even more supply hiccups and scarcity to follow us into 2022. 

A few of the trends we are starting to see with suppliers, in particular, are the holding of extra inventory. A standard rule of thumb could be having one or two months of supply, whereas now they are cautiously keeping closer to up to four months of items on hand. And even more unsettling news is that this hoarding mentality we’re seeing in both buyers and suppliers is only expected to send prices soaring higher in 2022. 

The good news is that vaccines are readily available, and hopefully, in 2022, we can keep inching closer to showing this pandemic—and supply woes and rising prices—the exit.