April 14, 2022 | Industry News
Spring 2022 Regional Market Report News
Global conflict, supply chain shortages, and rising energy costs are impacting several crops.
HEARTS OF PALM
Hearts of palm are trendy, especially on vegetarian and vegan menus. However, we predict the product will continue to be scarce in supply. Over the last few years a trend has emerged; hearts of palm growers have pivoted from producing canned hearts of palm to hearts of palm noodles or palm oil. As the value of palm oil rises, more farmers are opting out of the canned hearts of palm market, resulting in a dwindling supply of the crop.
Still, the plant-based movement is here to stay, and the depletion of hearts of palm doesn’t mean there aren’t other vegetarian-friendly options. We proudly offer several other plant-based products, which can be used as meat substitutes in recipes, like our Roland® Young Green Jackfruit in Brine and a variety of Roland® Artichokes. These ingredients are useful substitutes for hearts of palm on your menu.
Ukraine, one of the world’s largest sunflower seed producers, is a primary exporter of sunflower oil. The war has severely impacted production of the crop. This sunflower oil shortage has caused a ripple effect across the entire cooking oil category, resulting in increased cost and overall market volatility. Impacted are our products that contain sunflower oil (certain truffle oils, artichokes, and anchovy products) as well as olive oil. We have worked diligently to secure supply, but in most cases at higher costs. We continue to stay abreast of availability and cost of oils.
WHEAT AND CORN PRODUCTS
Scarcity of wheat, another top export from Ukraine, is impacting the availability of products including rice and couscous. Volatility in the corn market has also impacted our polenta. As a result, we expect to see rising costs across those categories. We remain focused on securing supply at the best possible cost.
OVERALL SUPPLY CHAIN AND ENERGY IMPACT
Global logistics has also been impacted by the war in Ukraine, as cargo planned to move through the Black Sea must be repositioned to other ports. Additionally, the COVID-19 outbreak in China, specifically in Shanghai, creates significant concern for another shock to global supply chain. Other Chinese ports are expected to become strained by diverted cargo and there is fear that once Shanghai returns to normal operations the backlog of cargo shipping out will overwhelm United States ports.
Energy prices, both global fuel prices and European electricity prices, are relatively stable after skyrocketing at the onset of the war in Ukraine. This rise in energy costs will continue to influence the cost of goods across product categories.
At Roland Foods, we understand the tangible effects of these current events on our suppliers and customers. We are monitoring the situation and will keep you informed along the way.