Coronavirus: Can supermarkets handle Kiwis' panic-buying?

Sales at some Pak'nSave supermarkets were up 50 percent at the weekend, as Kiwis panicked in the wake of the first confirmed case of COVID-19 on our shores.

"It was an incredibly busy weekend," Foodstuff North Island chief executive Chris Quin told The AM Show on Monday, with the record-breaking Lotto jackpot adding to the chaos.

Queues were out the door at some supermarkets in Auckland on Friday night, and crowds gathered outside stores before they opened on Saturday, to stock up on items like toilet paper, bottled water and hand sanitiser. 

Photos afterwards showed empty shelves where toilet rolls used to be.

"This weekend we moved 100,000 extra cartons into our stores to try and replenish and make sure customers could just shop," said Quin.

Although it might be a short-term financial bonanza for Foodstuffs, Quin doesn't want it to happen again.

"The number one message we'd have is if we shop normally, it'll work just fine. It doesn't help all of our customers get what they need when they need it, and there's just no need to do it. The supply chain in New Zealand is not under threat."

There have also been questions around whether Kiwis have even been buying the right things, should the virus get loose here. A study last year found plain old soap and running water is more effective at protecting you against viruses than hand sanitiser.

"You don't need it," said paediatrician Renee Liang, also appearing on The AM Show. "If you've got access to soap and running water, then washing your hands is better than hand sanitiser. But if you don't have access to running water - say if you're out - then having hand sanitiser handy is a good idea."

Despite this, Quin said there is presently a global shortage of hand sanitiser. 

"A lot of people have decided that's a method of dealing with it. When you listen to the great health advice we're getting here, I think there's are number of ways of keeping yourself safe - and it sounds like handwashing is the most important thing you can do. 

"[Sanitiser] comes in and out of stock pretty quickly because of the demand. Our suppliers are doing the best job they can to get us an allocation from where it's made globally - it's made in a number of countries - but it is in hot demand, people have decided."

Soap is particularly effective on COVID-19 because its outer layer is made of fat - which is dissolved by soap, killing the virus

Renee Liang and Chris Quin.
Renee Liang and Chris Quin. Photo credit: The AM Show

There is also no apparent threat to the water supply. Even if everyone in New Zealand was infected, COVID-19's mortality rate of about 2 percent would leave plenty of people still alive to keep it going, and there's no evidence it can be transmitted that way. 

Economist predicts 'impact on the supermarket sector down the track' 

The number of new cases in China, where the virus originated, was declining until this weekend, when the numbers started rising again. If it gets totally out of control, economist Cameron Bagrie says the shelves in supermarkets here face ending up empty before customers get a chance to clean them out.

Cameron Bagrie.
Cameron Bagrie. Photo credit: The AM Show

"China is the world's big factory, and that factory has basically stopped. Supply chains around the world are grinding to a halt," he told The AM Show.

"China is the global factory - they don't just supply iPhones and televisions, that sort of stuff; it's all the small stuff such as packaging, furniture, inputs in the construction process. New Zealand brought in $13 billion worth of goods in the last 12 months. That number is going to shrink, and shrink by quite a lot. 

"What we're seeing at the moment is if you can't get the orders, if the stuff doesn't turn up, well that stops New Zealand factories, it stops New Zealand production, and it's going to have an impact on the supermarket sector down the track. 

"An awful lot of New Zealand food, we package it up - how do we package it up? We put on wrapping, we put on packaging that we've sourced. Where do we get it from? Typically China."

Markets around the world had their worst week last week since the global financial crisis in 2008. Bagrie says this week is likely to be "somewhat wobbly" as well. 

"Globalisation has been at the epicentre of what's gone on around the globe - which is basically a fancy name for saying we've become increasingly integrated, but also very reliant upon China."

Ultimately, he admits, at stage "no one really knows" what's going to happen. 

 

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