Mary Skinner must eat red meat. His doctor told him. “I need protein,” explained this sexagenarian as he left Grand Central Market in New York. “Before I could buy a steak, But now, more and more, I turn to less expensive minced meat, he explained.
Although inflation moderated to 3.7% in the 12 months to September in the United States, in the case of the best retail beef cuts, the increase reached 9.7% in a year. In three years, steak, the most sought-after cut equivalent to beef tenderloin, jumped 27%.
The rise in meat prices thus outstripped general inflation. In the same market, a 30-year-old man from Connecticut explained that he joined the delivery service ButcherBox to reduce costs.
The plague of drought
The United States, which has an image closely associated with ranches and large herds of cattle, is suffering from a lack of livestock.
“Cattle production is at its lowest level since the 1960s,” said Scott Brown, a professor at the University of Missouri. In five years, the number of cattle has fallen by almost 10%, according to figures from the United States Department of Agriculture (USDA).
“The main reason is the drought” that has hit the breeding regions, especially the Great American Plains, “for many years,” explains Scott Brown, who places the origin of this phenomenon in the fall of 2020. The lack of rainfall reduces the number of pastures where livestock are fed and increases the price of forage.
In this difficult context, ranchers drastically reduce the number of animals they feed. By 2022, meatpackers will reach the highest level of slaughter “since the early 1980s,” emphasized Ross Baldwin from the agricultural consulting firm AgMarket.Net.
This decrease in the total herd was increased by more deaths because many animals fell in a fierce heat wave in August, which was added to the above-average ambient humidity.
Farmers partially compensate for these losses because they have improved cattle, producing a greater amount of meat than 10 years ago, and the possibility of achieving more cows with successful calving, Brown clarified. But at the same time, the demand for red meat is growing.
In 2022, Americans will eat an average of 26.8 kg of meat (about 500 g per week), 0.3% more than in 2021. Meanwhile, since 2015, the increase in consumption has been almost 10%, according to the USDA. With reduced supply and increased demand, wholesale prices for livestock more than doubled in March 2020 (+133%).
Lured by record prices, many farmers are selling their animals earlier, at lower ages and weights, and that’s keeping the beef population from growing, said Ross Baldwin, who doesn’t expect changes in the general situation in the next 12 months.
“It will take another three years (from next) for the (cattle) population to start to increase,” he said.
Meanwhile, “keeping calves for breeding (…) will reduce beef production in the short term, and prices will increase,” warned David Anderson, a professor at Texas A&M University. Finding enough pasture for a renewed and increased herd is also a challenge.
“The southeast has a drought, but not as much as the rest of the country,” emphasizes Scott Brown when referring to this region with low livestock density. “Could it happen that the cattle were moved there? It can happen”.
The USDA expects a new decline in livestock production in 2024. “Retail prices will remain stable, and ultimately, that will lead consumers to question whether to pay too much” for the product, it predicted. by Ross Baldwin.