DTC wine shipments grow (BSPE)
Total wine sales in the U.S. decreased 3% YOY in March. Off-premise wine sales fell 12% as the initial stockpiling period of the pandemic was anniversaries. DTC wine shipments continued to grow by 16% in March. The growth in DTC is a good indicator that the gains DTC made during the pandemic can continue. Many consumers visited winery websites and joined wine clubs. For many wineries, DTC was a vital replacement for lost tasting room sales. Vintage Wine Estates has roughly one-third of its sales through the direct-to-consumer channel. With winery tasting rooms reopening, continued growth in DTC shipments, and indoor dining resuming at higher capacity levels, the wine industry is positioned to grow in 2021.
Online grocery sales fall in April (ACI)
According to Brick Meets Click/Mercatus, online grocery sales fell 10% in April compared to March, according to Brick Meets Click/Mercatus, as seen in the following chart. Interest in online grocery shopping accelerated during the pandemic, and the supermarkets expect to retain new customers even as it ebbs. Online grocery sales in April were up 16% YOY and four times higher than pre-pandemic levels. Delivery and pickup sales were $6.6B, while ship-to-home sales were $1.4B. The average order value (AOV) fell 6% YOY due to a 7% decrease in the AOV of the ship to home orders. Pickup and delivery AOV fell 1% and 3%, respectively, and was 10% higher than pre-pandemic levels. The online user base fell 12% to 67.8M households in April.
Drought conditions worsening (TSN)
60% of the U.S. cow herd is now in some level of drought or dryness, with 46% of the country, especially in the West, now in some level of drought, as seen in the following chart. Trends have worsened in North Dakota and California in recent weeks. The quick progression of the drought this year is faster than any drought in the past 20 years. That is driving more cows to slaughter. The number of cows processed in March was up 10% YOY, and April was up 4-5% as it lapped increased slaughter last year, which was up 7%. The higher cost of feed is causing ranchers to keep the cattle on pasture longer which is complicated by the drier conditions. Retail prices for choice beef in April increased 4.2% from March and increased 4.8% YOY. Argentina recently limited exports of beef to fight high inflation. Retail pork prices set a record in April at $4.32 per pound, up 3.8% from March and up 11% YOY. Chicken retail prices, on the other hand, have fallen each month this year. April was 1.8% lower than March and 3.6% lower YOY.
