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Beef industry seeing demand

Author: Kristy

Steady economy allows shoppers to weather high beef prices

PUBLISHED ON DECEMBER 10TH, 2014


LAKIN, Kansas – Since 2011, weather and crop production have taken a toll on cattle.

“We couldn’t afford to feed the cattle, so more cows went to slaughter and we had to shrink the herds,” said Steve Landgraf, manager of Lakin Feed Yard.

National herd numbers were at their lowest in decades and the short supply led to record prices at the grocery store, ground beef prices reaching over $4.00 a pound.

Despite initial doubts about consumers inability or reluctance to pay the higher price, industry experts say a steady global economy and sinking oil prices have led to shoppers continuing to buy beef.

This year saw record beef exports to other countries, and a trend toward protein rich diets.

“Consumers did an excellent job of continuing to buy beef,” said agriculture expert John Jenkinson.  “Retailers did an excellent job of absorbing that shock of the higher beef prices.”

While the producers would like to see the demand for beef stay steady, they’re also benefiting from the corn prices.  Considering that each cow eats about 36 pounds of feed per day, lower grain costs help their bottom line.  With more rain and cheaper corn they’ve been able to rebuild herds and send bigger cows to slaughter.

“I think that in 2015 we will continue to see the supply of market ready beef hold steady, if not slightly increase, but that may be offset by demand.  [Supply and demand] may increase at the same level,” said Jenkinson.

An increase in supply could lead to lower prices for consumers.

“I think the prices will drop.  We make more money, we produce more, that’s how capitalism works,” Landgraf said.

Posted in In The Industry |
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