There are indications that as the Delta rises, Americans may be stocking up again.
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It is never a good sign when American shoppers start hoarding Costco goods.
When the pandemic first hit the United States last March, Costco stores were raided by panic buyers who piled up on staples like toilet paper and water and left stores selling essentials dry. With the highly contagious Delta variant on the rise in the US, Costco visitors on Twitter have again complained about the lack of toilet paper and water in the warehouse, as well as restrictions on the number of products they can buy.
One customer tweeted, “Go over to Costco and I’ll buy all the damn toilet paper,” while another in California said the shortage could be a “sign of the times to come.”
This suggests shoppers may be re-stocking goods, insider Mary Hanbury reported, but it’s not just Costco consumers. With hospitals in less-vaccinated regions crowded and mask recommendations returning, the Delta variant raises fears of a repeat of 2020. These Costco anecdotes suggest Americans are reacting just as they were a year ago – by preparing to stock up .
Almost three-quarters of Americans (69%) said they would consider replenishing their grocery and staple supplies, according to a survey by analytics firm Inmar Intelligence that interviewed 1,000 people.
Stockpiling could exacerbate the supply shortage that plagues the economy year-round, especially at a time when it looked like things could finally straighten out.
A return to hoarding could exacerbate supply chain problems
America reopened to a more expensive economy than the one that existed before the pandemic, largely thanks to a supply chain crisis that resulted from a cocktail of factors.
At the beginning of the pandemic, manufacturers struggled to gauge demand in a home-based economy while stopping factory production for safety reasons, resulting in material shortages. As unpredictable consumer behavior increased sharply earlier in the year, imports increased, clogged shipping ports and led to shipping delays. Bad weather, from the Texas Freeze in February to the drought in Brazil, only made matters worse.
When economic controls and pandemic savings sparked a wave of pent-up consumer demand that was mixed with widespread supply bottlenecks and bottlenecks, companies began to raise prices and inflation hit Americans’ wallets. The consumer price index rose 0.9% between May and June, significantly more than the consensus estimate of 0.5%.
Recently, there have been signs that both the supply crisis and inflation may be slowly easing. Large retailers, including Levi Strauss & Co., Mattel Inc., and Hasbro Inc., saw fewer imports in July, according to an S&P analysis earlier this week. The rating agency said this could indicate that the import boom that resulted from the economic reopening and the introduction of vaccinations may be slowing.
While inflation remains high, it also slowed last month as price hikes eased. The Biden government said it expected inflation to cool down as supply chains heal and the economy normalizes.
The supply chain has not completely rebalanced, however, which signals that American spending behavior could “accelerate the recovery” in the face of Delta, as Michelle Meyer, US chief economist at Bank of America Research put it. In a note released Friday, Meyer wrote that the recent slowdown in spending on Delta shows that the economy “may have a more bumpy road ahead than we originally thought.”
As Hanbury reported, consumer stockpiling for grocery stores could become an even bigger problem now than it was earlier in the pandemic as retailers still grapple with these supply chain issues as well as a labor shortage.
The economy faced many problems during the worst pandemic in a century. It would be something if the typical American toilet paper overload turned out to be a different one.