COVID-19 Update: How We Are Serving and Protecting Our Clients

COVID 19 “Can-Demic”

 

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Have you noticed your go-to beer or soft drink is hard to come by or completely unavailable?  It may not be coincidence; as the COVID19 pandemic continues to rage across the United States, shortages of a multitude of supplies have occurred.  Everyone remembers the toilet paper panic of March and April, the lack of available Personal Protective Equipment (PPE), the beef shortage at fast food restaurants like Wendy’s, and the general uneasiness these shortages and others like them gave us.  However, July has seen the rise of new shortages, most notably: aluminum cans.

You may have seen articles online or news segments that are discussing other prominent July shortages due to COVID19, such as coins or lumber; however, aluminum cans may make the greatest impact on the average American.  As COVID19 impacts rose, many Americans sought to bulk up on goods stored in their homes.  In doing so, consumption of products, including beers and sodas, shifted away from bars, restaurants, and convenience stores, which rarely utilize aluminum cans, and moved towards multi-pack products often purchased for domestic consumption.  These bulk-based products frequently feature aluminum-canned items.

This newfound demand for aluminum cans is pinching supplies for some drinks, and creating a significant disparity between supply and demand.  This disparity has sent the can industry into a tizzy, as manufacturers have already announced plans to build three new manufacturing plants in the next 18 months. Ball Corporation, a popular North American can maker, has also pledged to open two new manufacturing plants in the United States and add two additional production lines to already existing factories.  The corporation had seen an uptick in can demand from specialty drinks like hard seltzers and sparkling waters.  They also noted that the environmental upside of cans, combined with the rise in popularity of newly canned drinks and COVID19 impacts, has created “unprecedented demand and short supplies” of their coveted aluminum product.

However helpful the construction of new factories may be, these manufacturers still have an immediate crisis on their hands as they look to solve the problem until those plants are operational.  The bright side is that there is no shortage of raw materials needed to produce the desired cans, but rather just the manufacturing capacity. One solution has been reaching out to foreign-based plants for help with additional demand.  Another solution involves restricting or eliminating “niche” drinks, or drinks that aren’t in as high demand as the flagship products, such as Coca-Cola, Pepsi, Sprite, etc. Coca-Cola’s verified Twitter account was seen interacting with consumers questioning why they couldn’t find “niche” drinks like Cherry Coke Zero and Pibb.  Soft drinks aren’t the only producers feeling the heat from consumers.  Molson Coors, a popular beer maker, also made serious adjustments to keep up with demand.  In May, the producer suspended output of their products with low sales numbers, hoping to keep up with demand.  Accompanying their decision to do so was an explanation citing an “unprecedented shortage of 12-ounce recyclable aluminum cans.”

No matter how you dice it, COVID19 has had incredible impacts on supply chains.  These impacts have been felt on a spectrum across the country, impacting each region and population differently.  However, a shortage on aluminum cans could reverse that trend, affecting all regions and populations equally.  In 2017, 62% of all beer from U.S. based companies was packaged in aluminum cans, which shows how quickly pressed companies that produce beer, and even soda, can become if the shortage continues.

Shortages like these are important reminders that COVID19 impacts can’t strictly be measured in terms of life or death.  Although many recover, the impact, both medically and economically is still fairly severe.  To help stop the spread of COVID19, heed the advice of medical professionals.  Wear a mask or face covering, maintain the recommended distance of 6 feet between yourself and others, and avoid large gatherings, particularly indoors.  We are all in this together!

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