Consumers, restaurants to feel hit from beef prices
POSTED: Monday, March 4, 2013 - 11:00pm
UPDATED: Monday, March 4, 2013 - 11:14pm
Longview, TX (Longview News Journal) — It’s good news-bad news for beef producers — and not good at all for restaurants and consumers.
With beef prices expected to increase by 10 percent this summer, producers and sellers are worrying their product could become a luxury as meat market and restaurant menu prices spike.
“People are going to start looking for pork or chicken — something that is a little cheaper,” said Billy Tevebaugh, manager of Tevebaugh Meat Packing Co. in Longview.
Retail beef prices have risen by an average of $1 per pound since 2007. And prices for cattle have jumped by as much as 25 percent in the past two years as the nation’s herd dropped to its lowest level in six decades.
For beef producers, rising prices are bittersweet, said Bill Hyman, executive director of the Independent Cattlemen’s Association of Texas. The association represents cow-and-calf producers who are on the market’s selling side — the side that usually profits when prices increase.
But Hyman said high prices could wedge U.S. producers — including those in Texas — out of the market. Although beef prices naturally rise in the summer when demand peaks, he said a 10 percent increase in time for grilling season would open the door for foreign beef producers — namely Mexico and Canada — to profit from the U.S. demand for beef.
“We’re in a world market,” Hyman said. “When our domestic prices reach a certain point, beef importers will have a chance to bring in beef from other countries.”
The wedge could come in as domestic producers also are contending with higher feed prices also related to the drought and increasing prices for fuel.
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