US lettuce shortage is estimated to cost Olive Garden $4-$5 million in Q2

A lettuce disease called Impatiens Necrotic Spot Virus (INSV) has resulted in lettuce shortages across North America. The virus hit the Salinas Valley in California this fall, an area that produces about 50 percent of all the lettuce eaten in the US. Lettuce shortages and high prices are affecting businesses in the restaurant industry, including Olive Garden, a restaurant chain with annual sales of about $5.1 billion.

In a recent earnings call, CFO Raj Vennam of Olive Garden’s parent company Darden Restaurants said that lettuce shortages cost the company about $4 million to $5 million in the second quarter. Most likely, many other restaurant businesses are impacted by the shortage.

INSV is often fatal to plants and has been ruining Salinas Valley yields. It has caused lettuce prices to go up even more. They had already increased since the start of the pandemic. According to Restaurant Business Online, the average price of a box of iceberg lettuce was $14 in October 2019. In October of this year, it cost $67 — an increase of some 379%. 

Source: Entrepreneur


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