A Bottle, Can, and Cup Calamity

Argentina’s Onofri Wines, Monster Beverage, and Oklahoma’s Gray Owl Coffee have the same problem.

Let’s take a look.

Beverage Container Shortages

At home during the pandemic, we are drinking more alcohol and canned soda.

Bottles

Our alcohol demand spike made it even tougher for an Argentinian boutique vineyard, Onofri Wines, to cope with a bottle shortage. Combined with a fire at a local glass producer, they recently wound up with a 6,000 bottle shortfall.

You would think that a wine bottle shortage should create a decrease in wine exports. Not necessarily. As you can see below, Argentina’s vineyards sent wines, packaged in bulk, elsewhere to be bottled:

https://www.bloomberg.com/news/newsletters/2021-10-08/supply-chain-latest-argentina-doesn-t-have-enough-bottles-for-famed-red-wines

But “elsewhere” they might also have some difficulty. Reporting a similar bottle shortage problem, Napa Valley vineyards are searching for alternate packaging. But as one article points out, most of us won’t buy a fine wine in a box. However, state controlled liquor stores in Pennsylvania have a solution. They’ve limited consumer purchases to no more than two bottles of booze a day.

Cans

Meanwhile, Monster, maker of energy drinks like Juice Monster Mango Loco, is dealing with can shortages.  At home during the pandemic, we drank more beer and Coke in cans. In addition, the proportion of beer in cans has risen during the past decade. With more consumer demand and producers preferring cans, it was just too much.

https://qz.com/2058236/why-america-doesnt-have-enough-aluminum-cans/

Cups

And now, as some of us are returning to our past lives, coffee shops are trying to stock up on cups and lids. Because of factories that had to divert to health-related items and shipping difficulties, the containers for our drinks are also less available. As a result, stores like Oklahoma’s Gray Owl Coffee are asking customers to bring their own cups. Others, receiving an order for a small, have to serve a large drink. In addition, one coffee roaster says his cups cost three times as much.

Our Bottom Line: Demand and Supply

The beverage container shortages are really a demand and supply story. Below you can see the pandemic shift in demand. Then, we also had countless snarls in supply chains. Moving demand to the right and supply to the left leaves you with a higher equilibrium price and many unhappy consumers (that economists would say is less consumer surplus). Those unhappy buyers can be found along the segment of the demand curve that is below the new equilibrium price:

Technically, we do not have a shortage. With a new equilibrium, we just have a higher price and fewer beverage containers…

And many stressed wine, soda, and coffee sellers.

My sources and more: The WNYC Brian Lehrer Show introduced me to the coffee shop cup shortage while this article told me more. Meanwhile, the wine bottle shortages were explained by a Bloomberg Supply Chain newsletter and this radio station. Then, finally, Quartz and a craft beer brewer had the can story.