Breakfast Moves Back Home, Consumer Shifts Impacting Agriculture
Food trends that were predicted at the outset of this year have almost all been upended by the pandemic, especially as they relate to where people are consuming food. You may recall the pre-corona talk about the so-called “breakfast wars” between the big restaurant chains. The battle to gain a slice of the breakfast market share pie was making headlines in early March when Wendy’s announced that it would begin serving the day’s most important meal, following several failed attempts to make it work over the past fifty years.
In 2019, breakfast was the only daytime meal that experienced any growth at all for restaurants, after gradually building for about the last five years. Quick-service and fast-casual restaurants (QSRs) that include everything from McDonald’s to Dunkin’ to Panera Bread had been pushing out new breakfast options, some with major marketing campaigns like Burger Kings Impossible Croissan’wich. Then, like so many other things, coronavirus turned breakfast on its head.
With more people working from home, they are also eating breakfast and grabbing that morning coffee from their own kitchens. The major QSR chains have all reported a sharp drop in breakfast sales, though some have been able to offset those losses with sales growth at other times of day. Panera CEO Niren Chaudhary put it bluntly in a recent interview – “breakfast has dried up.”
McDonald’s also reported that breakfast took a hit in its latest earnings results. They did equate some of the declines to increased competition but put most of the blame on the disruption to commuters’ daily routines. Interestingly, Wendy’s did report promising sales for its breakfast menu, which only launched in March, though sales overall were still down in the second quarter.
The hit to “breakfast-on-the-go” could also spell more change for some ag sectors. The egg industry in particular has been really shaken up by changing consumer habits brought on by the pandemic. Fresh eggs, for instance, have witnessed a surge in demand thanks to higher demand from consumers cooking at home. By contrast, the market for liquid eggs has been decimated. Liquid eggs are sent primarily to schools, restaurants, hotels, and other foodservice markets, which are all still suffering from widespread shutdowns across the country. In Iowa alone, nearly 70% of the state’s flock produce for the liquid egg market. According to Maro Ibarburu, Associate Scientist in the Department of Animal Sciences at Iowa State University, at one point the price for a gallon of purified water costs more than the price of liquid eggs. He says that while some of the market has recovered, the going rate is still below the cost of production. (Sources: The Food Institute, WATTAgNet, CapitalPress, Food Dive)
