Beef Prices Climbing, But Other Food Prices More StableWed, 05 Jun 2013 10:12:03 CDT
Food price inflation should be low this year, except when it comes to beef prices, according to USDA economist Ricky Volpe who says greater beef exports combined with shrinking domestic supply is pushing up prices.
"International demand for these foods has been growing so we've seen demand going up while supply has been flat lining or even going down lately. The drought contributed to that as we saw ranchers across the country liquidating their herds in an effort to reduce costs. And so here we are in 2013 where beef prices are in many cases are at record highs and are going to continue to climb until the cattle inventories start to really expand to meet demand, which because of the size of these animals and the cost associated with growing them probably won't happen until 2014."
Poultry and egg prices are also increasing, but Volpe says prices in the rest of the supermarket should be stable for the rest of the year.
"The impact of the drought is looking like it is going to be less than was originally forecast and what that means is that right now we're on track for a year of basically normal food price inflation. We're forecasting a range of two and a half to three and a half percent."
And, Volpe says, pork prices should be flat this year.
"The inventory of hogs has been increasing a lot faster than has been the inventory of cattle. We've also seen to some extent consumers shifting away from pork products and towards poultry products, which historically in the last few years have been relatively less expensive."
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