Just in time for this year’s grilling season, beef prices have risen to their highest point in 27 years. This has taken consumer and restaurants by surprise with relief likely not to happen anytime in the near future.
As cattle herds dwindle and the export demand increases from countries such as Japan and China, the average cost of retail fresh beef has climbed to $5.28 per pound as of February. That price was nearly 25 cents higher than in January and the highest the country has seen since 1987.
Everything being produced is consumed, said one analyst and prices likely will remain high for the next few years as producers of cattle start rebuilding their herds amidst questions about whether the Midwest and Southwest will have enough rain to help pastures replenish.
At the same time, trips to the local grocery store could take longer as shoppers search out the best cuts of beef that will not break the bank.
Restaurant owners must also deal with high prices. Menu prices are being increased regularly. Since the start of February, some restaurants have increased their prices by 5% a month. Some are trying to cut other costs so they do not have to pass along the additional cost of beef to their patrons.
Some restaurants are adjusting the portions of steak they serve making them look the same size but thinner to help offset the increasing price.
Some restaurants now are serving sirloin in 6-ounce portions compared to 8 or even 10-ounce portions that were previously served.
Fast food restaurants have trimmed cost through reducing menu items and offering other types of meats, including burgers made from turkey meat. Chain restaurants contain buying in volume, which means they usually receive better prices.
For one group, the higher prices have come as welcome news. Ranchers especially in Texas have for many years struggled amidst high feed prices and drought.
Despite the recent numbers showing the cattle herds are the smallest in the nation since 1951, prices for beef have yet to decline along with the herd size, as demand remains strong.
Beef is not the only type of meat with prices that are higher. Pork has increased and largely due to a virus that is killing millions of piglets.
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