Costco Says It's Facing an Imported Cheese Shortage
Meanwhile, the chain of warehouse stores reports bacon sales are booming.
If you're used to shopping at Costco for imported goodies like cheese, you may find that these foreign delights are harder to come by. And as you peruse the meat case, you may notice that bacon is suddenly flying off the shelves, too. But interestingly enough, the fates of these two favorites are unrelated: Cheese stockpiles are running low due to a global shipping container shortage while bacon is simply seeing soaring consumer demand.
During Costco's earnings call last week, these two popular products stood out during the discussion. Richard Galanti—Costco's executive vice president and chief financial officer—told investors that a global shipping container shortage was preventing a number of popular products from reaching U.S. stores.
"From a supply chain perspective, overseas freight has continued to be an issue in regards to container shortage and port delays," he said. "This has caused timing delays on […] some food and sundries items like seafood, imported cheeses, and oils."
The global economic upheaval of 2020 has resulted in freight issues worldwide as trade continues to recalibrate itself in the wake of the pandemic. So —in further frustrating news for imported cheese lovers—Galanti added that the issue was far from Costco-specific, stating, "It's impacting everyone, of course."
But beyond logistic issues, the pandemic has also changed consumer behavior. And that's included an unexpectedly massive uptick in interest in bacon. "Bacon [sales are] up 45 percent in pounds," Galanti pointed out moments later. "So for whatever reason, there's a lot of demand there, so there's a little bit of challenge."
The good news is that neither of these trends appear to be long term problems. With the shipping container issue, Galanti stated that they "expect these pressures to ease in the coming months." Meanwhile, for bacon, the CFO said that, even with higher demand and higher prices, they "feel good about our competitive ability."
Still, one analyst pushed, "Are we're seeing panic buying in bacon yet?" To which Galanti quipped back, "Probably tomorrow because I mentioned it."