Distribution Shifts and Demand, Not Hoarding, Is Causing COVID-19-Related Shortages

Shortages, gluts, and the concomitantly higher (in most cases) prices for certain goods continue with no end in sight:

• Toilet paper remains hard to come by.
• Eggs lately have seen skyrocketing prices, with wholesale prices tripling since the beginning of March.
• Vegetables are scrambling to find buyers, as much if not all of Florida's crop will rot in the fields.

Yet, as Will Oremus writes in Medium, in the case of toilet paper, the problem mainly is one of distribution channels:

In short, the toilet paper industry is split into two, largely separate markets: commercial and consumer. The pandemic has shifted the lion’s share of demand to the latter. People actually do need to buy significantly more toilet paper during the pandemic — not because they’re making more trips to the bathroom, but because they’re making more of them at home. With some 75% of the U.S. population under stay-at-home orders, Americans are no longer using the restrooms at their workplace, in schools, at restaurants, at hotels, or in airports.

Georgia-Pacific, a leading toilet paper manufacturer based in Atlanta, estimates that the average household will use 40% more toilet paper than usual if all of its members are staying home around the clock. That’s a huge leap in demand for a product whose supply chain is predicated on the assumption that demand is essentially constant. It’s one that won’t fully subside even when people stop hoarding or panic-buying.

In other words, there is no easy way around this. With eggs, retailers are even taking a loss on pricing. This is largely due to commercial egg producers trimming flocks after a brutal 2019 where they "on average lost 2.7 cents per dozen eggs produced". And this despite cost decreases in feed and fuel, two of the biggest costs of the egg industry. It will take a substantial increase in the size of laying chicken flocks to make up the difference, yet as Bob Krouse of MPS Egg Farms says, "Once we're through the coronavirus, it'll be back to business as usual" — that is, he's not expanding.