Our second FoodBytes! webinar was viewed by almost 100 participants, mostly from the startup community, from more than a dozen  different countries. For this edition we heard from RaboResearch food and agriculture analysts sharing sector-specific perspectives in the midst of the Coronavirus pandemic, including J.P. Frossard of Consumer Foods, Steve Rannekleiv and Bourcard Nesin from Beverage, Tom Bailey from Dairy, Xinnan Li from Packaging, Sam Taylor from Ag Inputs, and David Magaña from Produce. 

Watch the webinar above and read on for some key takeaways from each sector. Plus, check out even more coverage from Nosh here.

J.P. Frossard, Consumer Foods

  • Liquidity is #1 concern right now
  • It’s clear restaurants have taken a hit, and e-commerce and well as grocery have come out as winners 
  • Overall the industry will take a 5-10% hit this year
  • Startups’ leg-up over bigger players is their ability to adapt and change quickly
  • Short-term, companies will need to keep up with the demand; longer-term, a recession is likely imminent
  • Delivery and takeout are the savior right now – moving consumers up the value chain creatively
  • Companies need to keep in mind that everyone’s job is a public service right now and honestly communicating from that place will help restaurants and brands not only stand out but weather the storm

 

Steve Rannekleiv & Bourcard Nesin, Beverage

  • Major shift is in on-trade (i.e. restaurants) to off-trade (i.e. retail) sales
  • Suppliers to top 50 brands are killing it right now
  • People are stocking up to hunker down – 30 and 36 packs of beer are flying off retailer shelves
  • Beverage brands with health connotations are thriving amid public health concerns
  • Online alcohol retailers like wine.com and driz.ly are having a field day
  • Consumers are less concerned with quality issues that had previously kept them away from shopping for groceries online
  • Large grocery retailers are struggling to meet even ½ of the DTC demand, but expect to see a huge reduction in e-commerce purchasing after the pandemic restrictions die down

 

Tom Bailey, Dairy

  • Demand is strong across dairy on the retail level, but down 40-60% in foodservice
  • The industry is working to redirect that milk from fresh to stable but facing storage challenges; we’ll likely see this re-constituted as food aid products
  • Appetite for premium products in dairy will be limited as people struggle economically
  • We’re seeing increase in comfort eating, which is a boon to dairy indulgent categories like ice cream and full-fat yogurt

 

Xinnan Li, Packaging

  • Short-term outlooks is positive
  • Medium term: there is a recession coming, which means project delays
  • There’s a surging demand for single-use plastic packaging right now
  • There’s pricing pressure on container board and plastic packaging 
  • The e-commerce surge is here to stay; being e-commerce ready will be a growth channel for companies
  • There’s a lot of pricing pressure, so if you’re able to provide a new type of packaging at a lower cost, you’ll be at an advantage 

 

Sam Taylor, Ag Inputs

  • Imminent fear of what a second wave of this virus could do to supply going forward
  • We’re seeing a significant increase in farmer e-commerce purchasing in China; some of the space has grown by 1000% over last few months as China looks to utilize the platforms that are there and enforce social distancing 
  • We could see an increase in adoption in the US in the near term
  • Operating practice by farmers: farmers are looking to adopt more technology in the applications to draw down on the use of inputs
  • We could see R&D opportunities open up in these spaces for startups moving forward

 

David Magaña, Produce

  • Seeing a surge for fresh produce demand in retail
  • Produce sales for a one week period in NA are up 34% compared to the same week last year
  • Fresh fruits up 28% and fresh produce up 48% 
  • Farm labor is the major challenge facing the produce sector
  • Produce is in more constant demand than shelf stable items with consumers needing to replenish every week
  • Outlook for produce amid crisis is neutral to positive

 

Feel free to leave a comment below, and stay tuned for the next webinar via Instagram, Twitter or LinkedIn

The views and opinions expressed during this webinar are those of the speakers and do not necessarily reflect the official policy or position of Rabobank or its affiliates. The information provided herein is for informational purposes only and is not intended to, and does not, constitute legal, tax, investment, accounting, or other professional advice. 

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