Business & Investment

Grinch hits candy cane maker with sugar deficiency, twisted supply chain Reuters

© Reuters. File Photo: On December 16, 2021, you can see dozens of candy canes at the Hammons Candies shop in Denver, Colorado, USA, the largest candy cane wholesaler in the United States. REUTERS / Alyson McClaran


By PJ Huffstutter and Marcelo Teixeira

Chicago (Reuters)-This year, Andrew Scheman’s candy cane business was flooded with orders, but the business was by no means sweet.

Schumann, CEO of Hammons, based in Denver, Colorado, said: “We can’t keep up with demand.”

Candy makers like retailers and farmers have been accused of soaring commodity prices, labor shortages, transportation and supply chain roars during the pandemic and can no longer be fully monetized during the holiday season. ..

For over a century, Hammond candies have been stuffed with a classic Christmas treat for small gift shops and large grocery stores. This is the largest wholesaler of handmade candy canes in the United States.

Hammond’s labor costs have increased by 30% this year, but staffing remains a problem. The company’s 250 crew has dropped by nearly 100.

It’s not just Hammond.

Co-owner Greg Clark was excited when Sam’s Club, a unit of Wal-Mart (NYSE :), ordered Doscher’s Candy Co.’s gourmet candy cane. Still, he said, Dosher’s had the staff and supplies to produce about 70% of the handmade candies that Sam’s Club wanted.

“More and more Sam’s Club members are buying seasonal candy, including candy canes,” a spokeswoman for the company said. “We increased purchases from other suppliers and advanced inventory and production where possible to meet expected demand.”

According to market data from the National Confectioners Association and IRI, total sales of seasonal confectionery have increased by 20% over last year in the five weeks leading up to December 5. Non-chocolate sales during the winter holidays, including candy canes, have increased by more than 34% since 2020.

Retailers have increased their holiday candy items per store by more than 9%. According to the data, the total amount of non-chocolate products in the store has increased by nearly 23%.

Many consumers are struggling to stock up for the holidays after missing a family gathering last year.

“This is the fourth grocery store I hit today, trying to find enough candy cane for our trees and stockings,” browsing Mariano’s grocery store in Chicago 51. Year-old Terry Andresson complained.

Kroger (NYSE :) Co, who owns Mariano, declined to comment.

Spangler Candy Co., the largest candy cane maker in the United States, has made an additional shift this fall to meet demand, said Kirk Vashaw, president. The Ohio-based company has abandoned its business and faced supply chain headaches.

“We had a cherry flavor coming in on Monday, but the truck was delayed so we had to stop and switch to raspberries,” Basho said.

Lack of sugar

Due to tight global supply, some sugar suppliers are limiting sales to food manufacturers.

According to USDA data, the United States imports about a quarter of its annual sugar demand. This year’s domestic crop strip was destroyed when hurricane Ida struck Louisiana, the second largest sugar cane-producing country in the United States.

Meanwhile, fares are skyrocketing and yields in Brazil and Thailand, the world’s leading sugar producers, are lower than expected. The price of sugar is the highest in 10 years.

“I’ve heard that some commercial buyers see erythritol as an alternative sweetener,” said Bob Cymbala, a food trader at A & J Global USA, about a sugar substitute made from corn.

However, the price of corn-based sweets is also rising. Clark of Doscher’s Candy said the corn syrup supplier used to make candy cane is estimated to increase by 10% in 2022.

The US government adjusted sugar import quotas after some foreign sugar suppliers failed to deliver their products amid tight sugar supplies.

Rick Pasco, chairman of the Sweets Users Association’s industry group, said candy producers have been hurt by US sugar policies that limit imports to protect local producers.

“You only get a small part of what you need,” Pasco said.

Grinch hits candy cane maker with sugar deficiency, twisted supply chain Reuters Grinch hits candy cane maker with sugar deficiency, twisted supply chain Reuters

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