[#268] Supply Chain in Numbers - Jan 13, 2025
Port strike averted, GLP-1 users spend 6% less on groceries, Options to increase 'single banana' sales, 65% US milk production under H5N1 testing now, Forklift sales are down by 28%
Welcome to “Supply Chain in Numbers.” This newsletter tracks significant numbers from the supply chain world. Five prominent numbers are published every Monday. If you have any feedback, please send it to me.
1 dockworker per semi-autonomous crane
The tentative contract agreement reached between unions and port operators avoids a potential strike at a swath of gateways will raise dockworker pay while adding new guardrails around automation. The pact would likely increase costs for shipping companies that want to implement robotics to make cargo handling more efficient. It will allow existing automation at ports in New Jersey and Virginia to continue being used, but the deal will require that companies have one dockworker to manage each semi-autonomous crane. That means that a gateway such as the Port of Virginia, which operates 116 semi-autonomous cranes, will have to hire one extra dockworker for each of 36 new semi-autonomous cranes it plans to add over the next few years. [WSJ]
6% lower grocery spending
Households with GLP-1 users were found to reduce their grocery spending by 6%, with the sharpest declines in high-income households and purchases of processed snacks, according to a study by Cornell University and Numerator. As appetites shift, restaurants like Smoothie King and CPG brands like Nestlé and Conagra are adapting with GLP-1-friendly products. The data showed a significantly larger drop in the purchases of calorie-dense, processed items, including an 11% decline in savory snacks. With nearly 15 million U.S. adults taking GLP-1 medications, what foods they consume is changing. This is prompting CPG companies to change what they sell and how they market their products. [Food Dive]
3,810 banana shoppers
Bananas are sold in bunches, but often a banana falls off the bunch before it hits grocery store shelves. This presents a bit of a pickle for the grocer, because people don’t like to buy lonely bananas when there are perfectly good bunches right next to it, which means that invariably the banana will finish its journey of thousands of miles in a dumpster out back. That sucks for lots of reasons, but a new study has a potential solution. Researchers made three different signs to hang up above crates of these single bananas: One is a picture of a sad banana saying, “We are sad singles and want to be bought as well,” one is a happy banana saying the same thing, and a third sign says, “Here are single bananas that want to be bought as well.” Over the course of the study, 3,810 banana shoppers were observed over eight days in two stores, and they ended up being far more likely to buy a single banana when the image of the sad banana was used. [NumLock]
65% of US Milk Production
The U.S. Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service (APHIS) announced that 15 additional states have enrolled in the National Milk Testing Strategy, bringing the total number of states to 28 in roughly one month since the program launched. These 28 states represent nearly 65% of the nation’s milk production. In addition, USDA is sharing updates on its expedited work to support vaccine development for use in poultry and bovine species, as part of a multi-faceted effort to fight the spread of H5N1. Also in the past 30 days, USDA has identified H5N1 detections in dairy herds in two states, California and Texas, with Texas’ most recent detection reported on Dec. 13, 2024. As of Jan. 8. 2025, California and Texas are the only states with known active detections, though the National Milk Testing Strategy may reveal additional herds over time. [USDA]
28% reduction in Forklift sales
Retail orders for forklifts fell 28 percent in 2023, the largest decline in 14 years. That was in part due to an inevitable slowdown after a frantic two-year period of warehouse construction in 2021 and 2022 that followed pandemic-related surges in needs for warehousing space. However, it’s also a potential sign of things to come, given that forklifts remain some of the most dangerous devices used in American workplaces — about 7,500 people per year are injured in forklift-related incidents — and are seen as a potentially strong contender for replacement, automation or systemic overhaul. Some factories are explicit about intentions to go forklift-free and use overhead cranes or electric pallet jacks instead. [NumLock]