The Stockout

The Stockout: Cargill puts its money where its beans are

Cargill’s announcement last week that it is making a nearly half-billion dollar investment in soybeans caught my attention because it suggests that one of the world’s largest food producers believes that soybeans are poised for sustainable growth and the recent price appreciation and surge in production are not just the result of transient trends. It’s clear to me that growing food segments, such as soy-based dairy alternatives and plant-based meat alternatives, are considered sustainable...

https://www.freightwaves.com/news/the-stockout-cargill-puts-its-money-where-its-beans-are

Intermodal provides greater savings in tight freight market

Earlier this week, in the last edition of The Stockout CPG-focused newsletter, I focused on reefer since the many CPG companies that require temperature controls are facing an even tighter freight market than those that do not. Today, I am shifting gears to discuss shipping dry goods and, specifically, intermodal insights from the latest datasets added to SONAR. Many consumer products are major intermodal customers and consumer products companies represented 31% of Hub Group’s revenue in 2020....

https://s29755.pcdn.co/news/intermodal-provides-greater-savings-in-tight-freight-market

Coin flip compliance — reefer carriers are rejecting half of tenders

Just as Pat Riley trademarked the term “three-peat,” I’m considering trademarking “coin flip compliance.” That’s the state of the reefer market today with reefer carriers rejecting 50.3% of tendered loads, up from 40% in early February and up from 10% at this time last year. So, as concerning as tight transportation markets are for shippers that don’t need temperature controls, those that do are in far worse shape. That includes companies in food/beverage/cosmetics/pharma. In today’s The...

https://s29755.pcdn.co/news/coin-flip-compliance-—-reefer-carriers-are-rejecting-half-of-tenders

Reefer shippers beware: Capacity shifting to dedicated and carriers practicing stricter freight selection

This article was originally published in The Stockout newsletter on February 3, 2021. To sign up for The Stockout newsletter, click here.

We recommend that CPG companies, and others that ship refrigerated goods, pay close attention to Marten Transportation’s results each quarter. Marten, which reported its fourth quarter last week, is listed seventh on the Transport Topics list of top refrigerated carriers and is the only “refrigerated pure play” among the publicly traded carriers (Swift...

https://www.freightwaves.com/news/reefer-shippers-beware:-capacity-shifting-to-dedicated-and-carriers-practicing-stricter-freight-selection

Nothing light about Bud’s debt load

the stockout

One financial metric in the CPG world that stands out to me is AB InBev’s net debt-to-EBITDA ratio: 4.8x. The company has been highly leveraged since its acquisition of SABMiller in 2016 when its debt topped $100 billion (net debt was $82.7 billion at the end of 2020) and the pandemic hurt the company’s profitability metrics that are usually compared to debt load. In this edition of The Stockout, CPG-focused newsletter, I discuss the implications for other CPG companies.

Bud does better when...

https://www.freightwaves.com/news/nothing-light-about-buds-debt-load

The Stockout: Fake meat — the future or freakshow?

Plant-based meat alternatives are to the food industry what electric vehicles are to the transportation industry — a niche with a lot of startups today but maybe not so niche in the future, especially as further quality advancements are made. In today’s edition of The Stockout, a CPG-focused newsletter, I discuss recent developments with Beyond Meat. I also share my thoughts about how the various products look and taste. Beyond Meat shares are sure polarizing, but regardless of your thoughts on...

https://www.freightwaves.com/news/the-stockout:-fake-meat-—-the-future-or-freakshow?

The Stockout: Reefer spot rates fall as contract rates catch up

Reefer spot rates hit five-month low as capacity loosens. After a relentless uptrend from May through September 2020, reefer spot rates stabilized through the end of the year. Aside from a short-lived spike around the holiday season, rates have contracted at a rapid rate through 2021 and are now at the lowest level since August. 

The decline in reefer spot rates coincides with falling tender rejection rates (ROTRI), a measure of how difficult it is for shippers to source capacity. Easing price...

https://www.freightwaves.com/news/the-stockout-reefer-spot-rates-fall-as-contract-rates-catch-up

The Stockout: Kraft Heinz cleans up its packaging

Kraft Heinz takes another step toward a more sustainable future. In the last edition of The Stockout, I wrote about how Kraft Heinz is testing the company’s first microwavable cup, set to launch sometime during 2021 upon the completion of testing. On Friday, Kraft Heinz announced that it was launching a new eco-friendly sleeve multipack in the United Kingdom. 

Image: The Kraft Heinz Company

This move will eliminate 550 tonnes of plastic on supermarket shelves, Kraft Heinz said. The cardboard...

https://www.freightwaves.com/news/the-stockout-kraft-heinz-cleans-up-its-packaging

The Stockout: Reefer capacity tightens in Northeast

It is becoming increasingly difficult to source transportation out of the Northeast. Over the past month, reefer capacity has become easier to source across the country due to seasonal trends along with absolute capacity beginning to return to the market.

“Historically, it’s usually easier to source capacity during the first quarter than it is the fourth quarter,” Capital Logistics founder and Chief Operating Officer Michael Feig told me Monday. “I think we are seeing that trend continue...

https://www.freightwaves.com/news/the-stockout-reefer-capacity-tightens-in-northeast

The Stockout: Midwestern Pet Foods aflatoxin contamination traced to Chickasha, OK plant

Harmful ingredients at two different companies force recalls. Midwestern Pet Foods expanded its recall of pet foods after more than 70 dogs died while 80 were sickened after eating Midwestern Pet Foods’ dog food. The sickness was caused by extreme amounts of aflatoxin, according to the FDA. 

Image: Midwestern Pet Foods

Aflatoxin is a mold byproduct that can grow on corn and other grains, and when it is concentrated at very high levels then it can be lethal to animals. The recall initially was for...

https://www.freightwaves.com/news/the-stockout-midwestern-pet-foods-aflatoxin-contamination-traced-to-chickasha-ok-plant

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