Commodity Conversations Weekly Press Summary

The lockdown measures are expected to help a lot of alcoholics overcome their addiction, according to a research centre in Thailand. However, some  are so severely dependent that suddenly stopping drinking could be dangerous. In India, there have even been reports of people committing suicide due to alcohol withdrawal symptoms. So much so that two states are reopening liquor stores, saying that more people are dying from withdrawal than from the coronavirus. In Kerala, the government is issuing “passes” to alcoholics to allow them to buy drinks. The price of alcohol in the black market has surged, as well as break-ins into the closed liquor stores. “How to make alcohol at home” has also become a very popular Internet search in India, according to Google Trend. 

The WHO, however, had to issue a notice clarifying that drinking alcohol would not help against the coronavirus. This was after a major news channel in Iran reported that close to 4,000 people had died from trying to treat the coronavirus by drinking adulterated alcohol. 

We previously talked about the closure of US ethanol plants as a result of the collapse in fuel demand, causing a surplus of corn in the US. The other consequence of the plant closures is that food companies are running out of CO2 for their refrigerators. This could slow down the production of food, notably meat, the Compressed Gas Association said. The price of dried distiller’s grains, an ethanol by-product used in animal feed, has also shot up. Feedlots are stuck between rising costs and a fall in demand following the closure, or slowing, of meat processing plants. 

After idling a meat processing plant in Pennsylvania, Cargill has interrupted production at its egg factory in Minnesota because of a collapse in demand as it mainly catered for the restaurant and food chain markets. The company warned it would also be slowing meat processing in Canada. 

The animal protection agency PETA, upon hearing the news, sent a letter to Cargill urging them to take this opportunity to make vegan products instead. PETA argued that eating meat was responsible for causing the swine flu and the coronavirus epidemics in the first place. However, several scientists interviewed by The Counter pointed out that there was currently no evidence that neither SARS-CoV-2 nor CoVID-19 were foodborne illnesses. However, they warned that the supply chain of wild animals destroyed geographical and ecological barriers which, combined with the proximity to people, facilitated the transmission of diseases. Overcrowding animals is also an issue in animal husbandry, especially with the use of antibiotics. One of the scientists warned that “antibiotic resistant bacteria are globally, perhaps, the most important source of disease emergence.” 

Nestle noted a 50% increase in demand for frozen food products since the coronavirus containment measures started in the US, notably for frozen pizza, as well as a surge in demand for baking products. However, while #quarantinebaking has been trending on social media, supermarkets have been struggling to source retail-size bags of flour. Data from the North American Millers Association showed that, up until the coronavirus crisis, only 4% of the US’ flour production was used by home bakers. 

This could also signal a turnaround in grains consumption which has been falling steadily over the past decade, according to an analysis by The Counter. And while the bigger milling groups have been struggling to adjust to the switch in demand, consumers have turned to local grain suppliers instead. A local farmers’ market in New York City, for instance, reported a 50% increase in the sale of organically grown whole grains, flours, and beans in the Jan-Mar period. 

Ports in Asia are struggling under the growing number of containers that are piling up because the coronavirus measures have significantly slowed down the pace at which the containers can be cleared. Besides, Alphaliner estimated the equivalent of 9% of the world’s container capacity had been idled as of the end of March,, due to low demand. Overall, global trade could fall by up to 32% in 2020 because of the virus, according to the WTO. Exporting countries like Brazil, meanwhile, are struggling to get containers. Maersk said it was taking empty containers there to help deal with the shortage. 

In a bid to streamline domestic logistics, Bunge announced the launch of its trucking app, Vector, which it has been testing since the start of the year. Bunge noted that, in addition to accelerating and simplifying the process, it also significantly reduced contact between people and was therefore a crucial tool in the times of the coronavirus. The group said exports were moving well despite the containment measures. 

Cargill and Agrocorp, with the help of Rabobank, used blockchain technology to settle a USD 12 million wheat shipment from North America to Indonesia. The stakeholders said the technology helped them shorten the trade deal to 5 days, compared to sometimes as much as a month. The platform, dltledgers, has seen USD 3.3 billion in deals traded over the past 18 months. 

Going back to our beverage news, bars in Washington DC have been exceptionally allowed to cater to the takeout market. One of them, called Dirty Water, has been lowering buckets of cocktails from the third floor of the building where it is located. But you can’t beat this Maryland winery which is using dog delivery. 

This summary was produced by ECRUU

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