Global demand for premium foods like wagyu beef, bluefin tuna and caviar has plunged, with thousands of restaurants shuttered and many economies sliding into recession amid the coronavirus pandemic.
As strict lockdown measures to contain the outbreak ravage global economic activity, the luxury food industry could be among the worst hit since it heavily relies on restaurants and top hotels for demand for deluxe items from caviar to champagne.
While some gourmet food producers are tapping consumers directly to stay afloat, others have been forced to cut output as some products have lost nearly half their value since the start of the year.
Mr Jean-Marie Barillere, co-chairman of champagne producers’ lobby CIVC in France, said he hoped people would celebrate the easing of lockdowns with a bottle of champagne, but expected a difficult end to the year. “This is really a period that looks like war time,” he said.
Data on bookings compiled by OpenTable, an online restaurant reservation service, showed a nearly 80 per cent year-on-year decline in seated diners at restaurants in the United States, United Kingdom, Germany, Canada, Australia, Ireland and Mexico this year.
People are also less likely to consume luxury food when stuck at home in the middle of a health crisis and worried about their financial situation, or under clinical social distancing measures as eateries reopen.
“People will not want to taste a Chateau Petrus wine, a lobster or caviar under a bell jar,” said Mr Michel Berthommier, managing director of Caviar Perlita in south-western France.
“If you force people to eat in these conditions, they will prefer going to fast food.”
“One of the worst-hit sectors worldwide” was premium foods, said Mr Ole Houe, director of advisory services at agriculture brokerage Ikon Commodities in Sydney. He did not expect a prompt recovery, given that many countries were in recession.
Falling demand has already taken a toll on the prices of luxury items. In Tokyo, the price of top-quality wagyu beef cuts has fallen about 30 per cent from a year earlier, that of bluefin tuna – considered the best in Japan – has dropped over 40 per cent over that period, while prices of the famed “Earl’s melons” from Shizuoka have slumped 30 per cent.
Mid-March, it felt like the sky had fallen on us.
MR FLORIAN BOUCHERIE, who produces two tonnes of foie gras a year in France. Foie gras producers in the country have had to cut output to prop up prices.
Russia’s top sturgeon breeding company Russian Caviar House was offering a 30 per cent discount for Beluga hybrid caviar.
“Spring and summer are always low seasons for the caviar market, but if we compare this period with previous years, the sales in Russia are down 50 per cent,” said the firm’s owner Alexander Novikov.
In France, caviar prices languished near historic lows, champagne sales tumbled, while foie gras producers have had to cut output to prop up prices.
“Mid-March, it felt like the sky had fallen on us,” said Mr Florian Boucherie, who produces two tonnes of foie gras a year in France.
Oyster and razor clam fishermen from Cape Cod and other top fishing grounds have also had to curb catches as lockdowns upended global eating habits.
To plug the yawning gap left by eateries, many high-end food producers are attempting to reach consumers directly via e-commerce platforms. Others are steering more produce onto supermarket shelves.
But some vendors say selling to supermarkets is far less profitable than selling to high-end restaurants. In Japan, top sushi chefs pay 400,000 yen (S$5,200) for 10kg of the best cuts of tuna compared with the 25,000 yen paid by supermarkets for 10kg of lower-value cuts, said Mr Yukitaka Yamaguchi, owner of Yamayuki tuna brokerage at Toyosu Market in Tokyo.
He said “the best part of (the) tuna” was usually sold first to high-end sushi eateries but when these closed, the “harakami (fatty tuna) had nowhere to go”. They eventually started offering high-quality tuna to fish retailers and supermarkets.
For now, Mr Yamaguchi has had to park plans to retire as he has accumulated debt during the pandemic. “I had planned to retire when I turn 60, but that’s no longer possible,” he said.