Last week I discussed the UN’s warning that there is the chance for widespread hunger and starvation in the wake of the Wuhan Flu as food supplies and supply chains are disrupted due to the closing of borders and the locking down of economies.
Well, it seems as if it will not just be the Third World that will be affected by the Wuflu and the policies put in place in reaction to it. There are also looming meat shortages in the USA and elsewhere as meat processing parts are closed and farmers are culling animals that they cannot keep and cannot get processed.
According to Detroit News, plant shutdowns have meant that a third of US pork capacity is down; the first big poultry plants closed last week and experts are predicting that US domestic meat shortages are only weeks away. This is not just a US problem: Brazil, the number one exporter of chicken and beef in the world, saw its first major closure with the halt of a poultry plant owned by the world’s largest meat company (JBS SA). In Canada, there are meat processing plants being closed, including poultry plants in British Columbia.
Taken together the US, Brazil and Canada account for two-thirds of world meat trade. Processing plants must choose between operating to sustain food supply or shutting down in an attempt to prevent further spread of the virus. Remember that these shutdowns in the Americas come on top of a worldwide porcine disease that has left around a quarter of the world’s pigs dead.
With slaughterhouses closing, many farmers are struggling to dispose of their animals. Some plants which are unable to keep up full scale production due to employee illness are also killing animals that they cannot keep: one large chicken processing company was forced to kill 2 million birds this month.
Thus, we have the irony of having stocks running low while at the same time we are also seeing large scale culls of livestock.
It is not surprising that the wholesale price for meat is soaring: US wholesale beef touched a record price last week, and wholesale pork rose more than 29 percent in one week – the fastest price jump since 2012. It won’t be long until meat prices rise at the supermarket shelves.
The only good news is that so far there have not been a large number of shutdowns in the EU, which accounts for about a fifth of global meat exports.
The number of cases in meat processing plants seems to be relatively high perhaps due to the fact that large numbers of their employees are immigrants who live in close quarters in which the disease can quickly spread. Another factor is that employees are often in close proximity on the job, the work on some processing lines can be elbow-to-elbow. Even if workers are spread out, line speeds are lowered, and shifts are staggered, there is still the chance of mingling in break rooms etc. There are thousands of people employed in these bigger plants everyday – the opposite of social distancing!
Further, the federal oversight may be spreading the disease from plant to plant – over 100 inspection-service employees have tested positive for the Wuflu with at least two inspectors reported to have died. As they travel between facilities there is a concern that these inspectors will bring infection to plants that have not yet suffered an outbreak.
We have focussed on the direct health consequences of this pandemic for a couple of months. We will be focussing on the economic, supply chain and direct health consequences of the response to the pandemic for a long time to come.