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Panic buying amid US port strike raises food supply concerns
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Panic buying amid US port strike raises food supply concerns

Stew Leonard, Jr., CEO of grocer Stew Leonard's, told CNBC that his grocery stores have front-loaded what they could and are fine on most items through Thanksgiving, but customers looking for fresh produce and fish may have to delay their purchases change, and bananas could skyrocket in price.

Bloomberg | Bloomberg | Getty Images

As the strike at East and Gulf Coast ports continues into its third day Thursday, consumer fears about product shortages have led to panic buying along the East and Gulf Coasts, with shoppers snapping up toilet paper and other household items, leaving empty shelves when they wake up.

The National Grocers Association, which represents more than 1,500 members in the independent supermarket sector – family-run or privately controlled grocery retail companies – told CNBC it is conveying to the public the need to remain calm. Nationwide, there are more than 21,000 independent grocery stores in the United States, generating over $250 billion in sales and supporting more than one million jobs.

“As the port strikes continue, independent grocers are actively working with their wholesalers to secure alternative delivery options and are efficiently managing their inventory to ensure minimal disruption to their customers,” a spokesperson wrote to CNBC. “Products like toilet paper and bottled water, along with so many other items on consumers’ shopping lists, are made in the United States and are not affected by the port strike. Although some fresh produce may no longer be available, it will be quickly restocked once the strike ends.”

The National Retail Federation told CNBC that retailers had been preparing for months for the possibility of a strike at East and Gulf Coast ports, including pre-loading shipments of discretionary and non-discretionary products.

“The industry is working with supply chain partners in the manufacturing, supply, logistics and shipping sectors to ensure that essential products and services remain readily available to customers and retailers can continue to meet consumer demand. There is no need to panic buy, and we encourage consumers to shop responsibly. If you do not need an item in the next two weeks, please leave it to someone who does,” the association said in a statement.

Bill Simon, former CEO of Walmart, stressed that panic buying is serious and could have a cascading effect on domestic products.

“Panic buying is not only impacting the availability of imported products, but both domestic products and consumers are changing their purchasing behavior,” warned Simon. “The rise in prices coming so quickly after several years of inflation will have a chilling effect on the consumer … who is already in a bad mood. Every effort should be made to resolve the issue immediately.”

Simon added that the U.S. supply chain is designed to reduce costs.

“To do this, we had to reduce a large part of the safety stock that cushions disruptions,” he said. “So if an external action, (like) Covid (or a) port strike, creates abnormal demand in the form of panic buying, the supply chain is unable to respond.”

Walmart and Target did not immediately respond to inquiries about panic buying patterns seen at their stores.

“We’re worried.”

John Catsimatidis, owner of New York superchain Gristedes, said panic buying was happening and there were no signs of slowing down.

“Toilet paper is the most purchased product, followed by paper towels,” Catsimatidis said. “We are concerned about the fruit and vegetable department and are looking for alternatives to transporting fruits and vegetables.”

Data from Vizion shows that nearly 2,000 containers filled with fresh produce are stuck on ships anchored off ports closed due to the strike.

Catsimatidis, who supported Donald Trump in 2020 and is backing the Republican candidate again, said that in his view, these problems could have been avoided by the Biden administration.

“We do not understand why President Biden did not call on Taft-Hartley to extend negotiations,” he said, referring to federal law that allows a U.S. president to intervene and stop a strike for a period of 80 days . “Neither side is talking and the important trade is at stake. Consumers are thinking ahead and buying products now, but this will put even more strain on supply chains. Bring the parties back to the table.”

Stew Leonard, Jr., CEO of grocer Stew Leonard's, told CNBC that his grocery stores anticipated the strike and brought forward what they could and what was good leading up to Thanksgiving. But customers looking for fresh produce and fish may need to change their purchasing decisions.

“Customers who might like the sweet Brazilian shrimp may need to purchase Gulf shrimp,” Leonard said. “Pineapples, bananas and mangoes are exported to the East Coast, as are other vegetables such as asparagus. Bananas are the No. 1 fruit export in our fruit and vegetable department. We will get them, but it may be a longer transit from China, or.” Fly and transport them. This will drive up prices due to logistics costs. Then you see parents choosing to put an apple in the lunch box instead of bananas.

Leonard said the cost of bananas could double in the short term.

Prices of essential goods are rising as the impact of the port strike widens

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