- Traditional Christmas dinners featuring turkey or pork will be 8.1% more expensive this year than in 2019, according to research by the commodity price analytics firm Mintec. This increase is mainly driven by a 19% year-over-year leap in pork prices and a 13.2% jump in turkey prices, supported by pandemic-related supply shortages and higher demand. Other components of the dinner, including potatoes, carrots and gingerbread, will be cheaper than last year.
- However, plant-based main meals are expected to be slightly cheaper, with prices down 0.1%, according to Mintec, which formulates its projections based on prices for pea and soy proteins used in meat substitutes. This will be a welcome figure for the 81% of millennials who are open to changing the makeup of a Christmas dinner, according to a poll by Eat Just. More than 60% of millennials said they eat differently than others around their holiday table.
- Despite changing dietary expectations for the holidays, Americans continue to indulge in traditional holiday feasts. This past Thanksgiving, turkey sales were strong even as consumers paid more to put the traditional bird on the table.
The lead-up to Christmas may be the most crucial grocery shopping week for retailers. This year, months of supply chain disruptions and altered shopper habits have left both manufacturers and consumers viewing the holiday period with uncertainty. The emergence of the coronavirus shifted demand and pricing for commodities across the board this year: Sales for flour skyrocketed while potato prices dropped on lower foodservice demand, according to IRI data cited by Mintec.
Plant-based product sales far outpaced those of many other foods in the grocery store. In the first nine months of the year, meat alternative sales skyrocketed 129% above 2019, according to Nielsen statistics. The popularity of plant-based is even beginning to make inroads into the holiday season. Eat Just's poll found that 70% of millennials would happily make a holiday meal plant-based, compared to only 33% of the older boomer generation.
This generational divide is playing out in the market. Tofurky CEO Jaime Athos told Food Dive in November that sales of its Plant-Based Roasts and Plant-Based Holiday Feasts are up 22% over last year. That said, animal-based meat continues to hold the dominant market share for protein in the U.S., with retail sales worth about $95 billion, compared to about $1 billion in sales for plant-based meat.
This continued demand for animal protein has pushed prices up even as a large portion of the U.S. population continues to struggle with the economic ramifications from the pandemic. As a result, plant-based alternatives, which happen to be a somewhat cheaper option this year, may appear with increased frequency on holiday tables.
Another popular category that has gained steam during the pandemic is baking. When stay-at-home orders first came this spring, baking became a national pastime. In June, manufacturers said they were selling as much flour in the summertime as they typically do during the holiday season. According to Nielsen, Americans spent $5.15 billion on baking staples in the 52 weeks that ended May 23, including $1 billion on flour. Part of this large sales figure is due to a 14.3% increase in prices over last year, Mintec said.
While the run on baking staples has subsided, demand for the basic kitchen staples that are essential to the holiday food tradition remains high. The market for ready-made baked goods is also heating up. The growth rate of the cookie market hit 6.6% or about twice the growth recorded for 2019 for the 52 weeks ending Sept. 16, according to IRI data.
Continued interest in indulgent treats is now intersecting with the holiday season and is likely to drive consumption. And cookie lovers are in for a treat: The cost for gingerbread cookies are 18.9% less than last year, mainly due to lower prices for butter (-32%) and eggs (-18.1%), according to Mintec.
With the pandemic rendering this holiday season unlike any other, manufacturers and retailers alike will need to adjust their plans and expectations to meet the needs of consumers, who may be drifting toward a permanent change that will be reflected in the years to come.