The Real Reason There Might Be A Candy Shortage This Halloween

Prepare your sweet tooth for some sour news from the candy industry. Trick-or-treating will likely take a hit in 2022, thanks to The Hershey Company, one of North America's top candy producers. In its financial report for the second quarter released on July 28, Hershey raised its full-year financials outlook, stating double-digit growth across all segments. But that rosy report belies an upcoming Halloween horror for consumers: a candy shortage. At least from Hershey.

Along with the quarterly financials report, Hershey's CEO Michele Buck revealed that the company will fail to fully meet consumer demand for autumn candy, notes the Seattle Times. Hershey's made production decisions for the Halloween holiday earlier in the year, when existing circumstances forced key decisions. Now they're facing the impact of those choices, many dictated by external forces and others by internal "mistakes" hinted at by Hershey CFO Steve Voskuil.

Here's a look at what's causing the impending Hershey Halloween meltdown.

As with other food sectors, candy-making got a lot harder when the pandemic and Ukrainian crisis collided. Lingering pandemic-related labor shortages and supply-chain issues compounded when the Ukraine-Russia conflict started affecting the availability of ingredients, per Food Dive. CEO Michele Buck explained how the Russian clampdown on natural gas supplies to Europe impacted Germany, which is a main source of ingredient supplies and equipment for The Hershey Company.

After production impacts on its factories affected Easter sales, Hershey had to make decisions for the next major candy-centric holiday, Halloween. Because the same production lines churn out candy for Halloween and everyday candy supplies, they were forced to choose which to prioritize, explains the Seattle Times. Resource allocation went to maintaining a consistent stream of products to retailers throughout the year — while also launching a longer-term plan to reduce production bottlenecks.

By May, Hershey had announced a capacity investment plan that included expanded distribution and fulfillment centers as well as 10 new production lines, per Food Drive. But the short term will take the brunt of long-term promise. Most implementation results will bear fruit in 2023, according to Buck, long past the coming Halloween 2022 holiday.