With Americans spending more of their food dollars at the supermarket, the specialty crop sector will continue to adapt to the pandemic and the loss of food-service sales in the new year, said agricultural lender CoBank. “Steep financial losses from the loss of food service contracts will ultimately result in the rationalization of some processing assets and production acreage.”
CoBank forecast strong U.S. economic growth in 2021, hinging on control of the coronavirus. Consumers will be reluctant to return to restaurants until they are assured it will be safe.
“Some growers, packers and processors have successfully managed to increase or re-route products into retail channels like grocery stores and home delivery of food boxes,” said the year-ahead report. “Growers who have been unable to find a home for fresh produce will be pressured to reduce acreage while packers and processors will weigh the costs of investing in more assets for delivering into retail channels.”
The CoBank report is available here.