Wine industry sales (NAPA, VWE)
Domestic wine sales including bulk imports increased 11% last year to $54.8B in the year ended August. Sales in August increased 7% YOY to $4.3B, even with the 7% growth in July. Off-premise wine sales decreased 2%, even with July’s decline. DTC shipments decreased 8%, improving from the 18% decline in July. Vintage Wine Estates reported an 11.6% decline in depletions in the quarter ended June due in part to tight supplies.
Strawberries approach a ten-year low (STKL)
Heat in the West stimulated late summer strawberry growth over the past few weeks. The market is now flush with product. With prices below $8, strawberries are near a ten-year low for week 37. While prices for farmers are low, it has not resulted in promotions in the grocery aisles due to the high cost of transportation. Strawberries are the most important fruit for SunOpta’s fruit-based business. The company has shifted much of its sourcing to Mexico, California now only represents less than 10% of total pounds.
Promotions rise in the grocery channel (KR, ACI, WMT)
CPG promotions have risen to +2% YOY in the week ended September 11. Beverages were the most promotional category, but promotional levels dropped to +3% in the week ended September 11 from +9% in the previous week. Nearly all of the edible and non-edible categories were flat to up YOY in promotional levels except alcoholic beverages which was down 1% and general merchandise which was down 3%. Promotional levels have been flat to up in the last four weeks, reflecting improved in-stock levels. Promotional levels are still well below pre-pandemic levels. We expect promotions to increase as the supply chain challenges diminish. The multi-outlet channel has seen promotional levels slightly behind the grocery channel.
