Beef Loses Market Share to Pork and Poultry
Current high price of beef is not being driven by demand.
Compiled by staff
Published: Aug 10, 2010
The price of beef at the meat counter is up but it's not causing producers to expand the herd. The unfortunate side of the story according to Purdue Extension Ag Economist Chris Hurt is that other meats are going to absorb some of beef's market share. Hurt has been studying the price of beef at the meat counter and sale barn. It's up and he thinks it'll stay that way, but it's not driven by demand.
Hurt says there's just not as much beef around today as say last year or even more so three years ago. It costs a lot to eat beef, and for the time being, cash strapped consumers that have already cut back from eating 222 pounds of meat per year to 208 pounds are turning away from beef.
"The poultry sector is the one that is really starting to increase production rapidly," Hurt said. "So as we rebound from the 208 pounds, one of the unfortunate sides for the beef sector is that the poultry sector is going to gobble away at probably a good bit of that increase from 208 pounds up to say 215 pounds we'll see over the next couple of years."
Poultry supplies have already begun to expand and pork producers are expected to put more meat on the table next year. Hurt says the beef cattle herds however won't deliver until maybe 2013.
Seeing the beef industry move slowly to expansion is not a new concept. The beef cycle normally takes at least ten years and sometimes stretches to 15 years. This doesn't mean beef producers won't make money over the next few years, beef supplies will be small and many people still love to eat beef. This likely means that beef cow ownership will be financially rewarded.
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