Truck shipping

How shipping and pork drive up costs in the restaurant industry

Whether it’s takeout, delivery, or in-person dining, the cost of a meal has been steadily increasing. As customers we see one side of this – the one where we get frustrated when it’s time to pay for our food or drink and it’s more than before. For professionals in the restaurant industry, a recurring theme I’ve heard for increases is the rising costs of products that have been affected by a variety of factors.

Anne-Marie Panoringan

Voice of OC Food Columnist – reporting on industry news, current events and trends. Panoringan’s previous work includes writing about food for 8 years at OC Weekly in which she interviewed over 330 chefs, restaurateurs and industry professionals for her weekly column “On the Line”. She has been recognized by the Orange County Press Club and is also a recurring guest on the AM 830 SoCal Restaurant Show.

The impact of shipping

The delay in receiving goods from overseas has had one of the most significant impacts on the supply of ingredients and the associated prices. Veronica Castro, European sake and wine buyer for Hi-Time Wine Cellars, is well aware of the backup, citing the two-week quarantine due to COVID on ships arriving at the Port of Long Beach (the second largest container port the busiest in North America) as the main culprit.

When she has customers asking for a specific product that is not in stock, “I tell them to look off the coast of Huntington Beach – where a line of ships is moored – and tell them it’s there.” that is their wine (or sake or champagne). “

Castro says the range of delays isn’t limited to Long Beach. One of his suppliers told him that other ports are feeling similar pressure. “There was a queue of 15 to 20 sea containers waiting at the Port of Oakland. Wait times in Seattle, Los Angeles and Long Beach are around seven days, and ports on the east coast of the United States are also experiencing ship wait delays due to secure truck coverage, ” she declared. However, she points out that things are gradually improving, as the ships were lined up as far south as Laguna Beach.

Veronica Castro, European sake and wine buyer for Hi-Time Wine Cellars, consults with a client. Credit: JULIE LEOPO, Voice of OC

Among the products in which Castro specializes, she has seen a price increase of $ 2-5 per bottle on imports across the board. Tariffs imposed on imports in recent years have pushed the cost of bottles in other sections up to $ 15, “But tariffs are a separate issue,” Castro said.

Further down the transportation pipeline, the role of the trucking industry in freight forwarding had its own problems. Manufacturers experience supply chain disruptions that are sometimes due to a lack of packaging. I was recently at a corporate chain ordering breakfast drive-through and only noticed after my items were wrapped in plain white paper (unbranded). A shortage of material resources or workers using machines in a printing house means orders cannot be filled and loaded onto trucks, resulting in stock-outs like food packaging.

The lack of experienced drivers is an additional factor in shipping delays as more and more existing truckers reach retirement age, but fewer people are interested in joining the industry. Even with trained and experienced drivers, variables such as prolonged wait times in a congested port while stocks are unloaded and transferred to vehicles for transport take away the turnaround of ships, shipping containers and large platforms, possibly resulting in more delays and higher demand for items. Time is money, and time wasted at all stages of transport increases costs.

How do meat demands (and Proposition 12) impact costs?

The stockpiling of toilet paper and perishables by consumers last year, compounded by closures of foodservice industries, including meat packaging, sent beef prices soaring, followed by close by the pig.

Restaurateur Priscilla Alfaro of Jalapeños Mexican Food, a brand that has served OC for over 30 years, expresses concern. “The past year and a half has been difficult in many ways for restaurants. Menu prices must increase if all of our expenses increase. For Alfaro, beef that previously cost $ 3.85 a pound now costs him $ 8.00, more than double the original price.

She addressed shortages of paper products as well as meat, forcing a search for an inventory comparable with other suppliers to maintain the quality for which jalapeños are known. “I’ve tried not to raise the prices as much as possible, but it’s just not viable at the moment,” Alfaro said.

Meat prices were complicated by the Farm Animal Confinement Proposition (aka Proposition 12), a California law passed in 2018. The goal of the initiative was to standardize the regulations under which livestock were caged, including improving the living conditions of pigs, cattle and chickens. While the change in current practices for calves and chickens seems manageable, there is much greater concern for the adjustments needed for pigs.

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Twenty-four square feet of floor space will be needed for pig farmers. To make accommodations for pigs by the January 1, 2022 deadline, an increase of at least 50% in the cost of pork is planned.

According to the National Pork Producers Council (NPPC), “California accounts for 15% of the US pork market, with large Latino and Asian populations who have long-standing cultural preferences for pork.” The diversity of cuisines in Orange County and beyond includes meals that include carnitas, katsu, chorizo, and ramen.

The Kashiwa Ramen in Costa Mesa, where chicken and pork broth is popular, is one of many noodle houses that need to adjust their menu prices. According to operator Hiro Yamanouchi, “This has crucially affected our tonkotsu ramen and pork cha-shu. For example, the cost of pork belly has increased by $ 1.60 per pound. Due to this significant increase, we had to change the price of our tonkotsu ramen from $ 10.15 to $ 11.95. An additional serving of cha-shu also increased by $ 2.

Importing authentic Japanese ingredients will soon represent a double increase in costs for Yamanouchi, as its 40ft air containers used to transport the necessary products (seaweed, Japanese water-based soy sauce, chili powders as the only found in Japan, etc.) are going from $ 5,000 to around $ 20,000, plus the overall cost of the ingredients increases. Regarding the evolution of the cost of pork in California, “We cannot imagine how much the overall cost of feed will increase in the near future,” he laments.

Slater’s 50/50, based in Orange County, sailed into COVID by closing the flagship Anaheim Hills location in early 2021. Its signature burger patty is derived from 50% ground beef and 50% chopped bacon. COO Ernie Romo fully understands the impact of Proposition 12.

“Since bacon is one of our main differentiators, the new regulations will undoubtedly affect our business,” he said. It also recognizes that factors such as changes in operating costs and product prices occur every year. “However, as restaurateurs, we are always ready to adapt and evolve as necessary and we are committed to continuing to preach the gospel of ‘Burgers, Bacon and Beer’.”

At the end of the day, restaurants are blocked for the time being. This means that customer frustration with higher prices is unlikely to dissipate anytime soon. Even though restaurateurs want to keep menu prices low, the complicated equation of acquiring goods, which includes shipping and new legislation, dictates that your next burger (or burrito or cocktail) is likely to cost more than you expect. .

Anne Marie Panoringan is a food columnist for Arts & Culture at Voice of OC. She can be contacted at [email protected]

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