Americans Continue to Demand Beef Amidst Record PricesFri, 25 Jul 2014 17:53:40 CDT
Across the board cattle and beef prices have surpassed record levels. Speaking at the Oklahoma Cattlemen's Association annual convention, Livestock Marketing Information Center Director Jim Robb says from an economist view its a combination of the supply and demand side coming together.
"The domestic consumer demand has stayed surprisingly strong and we've had some support in the beef complex from the trials and tribulations in the pork industry and the moving up of pork and hog prices," Robb said. "Then the export demand has been surprising good at these very high prices that foreign demand has stayed very strong and very robust for beef, in fact we are getting year over year increases still in beef exports."
At the OCA meeting, Robb talked with Radio Oklahoma Network Farm News Director Ron Hays about the market situation. On the supply side, the industry has shrunk numbers significantly in recent years from ongoing drought in the south as well as the Midwest. In the short term Robb says packers are needing animals, which pushes cattle and in turn beef prices higher. He says there are strong fundamentals under the market and at some point the market will peak, but no one knows when that will take place.
While beef prices have moved to record levels, demand has not been effected. Robb says part of that is Americans having a craving for beef and in looking at the meat case, pork and chicken prices have also increased.
"Overall we have to remember that the US average consumer spends 11 percent of their disposable income according to USDA (on) food at home and away from home," Robb said. "So you have to shock 'em and really the beef prices have been a bit of a concern, but they haven't changed their buying patterns very much and that's really been a very key component of why we have these very strong prices."
Looking ahead Robb looks for this summer to be a turning point as the industry reaches a transition point nationally toward stabilizing and starting to build the cowherd.
Overall consumers have adjusted to these higher prices and have not backed away from beef. Robb says beef demand is following the overall health of the economy and he doesn't see beef demand dropping substantially, unless the economy slides into a major downturn.
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network- but is also a regular audio feature found on this website as well. Click on the LISTEN BAR below for today's show- and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
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