Retail meat prices in January climb by most in seven years
Thu, 24 Feb 2011 9:30:16 PST - Author: Bruce Blythe, Business EditorRetail meat prices in January rose the most in seven years, as last year's accelerating food inflation extended into 2011 amid smaller cattle and hog herds.
A meat price index tracked by the U.S. Bureau of Labor Statistics rose 8.4 percent last month on a seasonally-adjusted basis compared to January 2010, according to a Feb. 18 report. That was the largest year-over-year gain for that month since 2004. Meat prices rose 7.2 percent in December compared with year-earlier levels and have climbed an average of 7 percent over the past six months.
Beef and pork prices are climbing in part because livestock feeders cut herds after feed costs soared in 2008 and the recession hurt demand. Prices for slaughter-ready cattle and hogs last year rose 25 percent and 22 percent, respectively, based on Chicago futures. As of Jan. 1, the total U.S. cattle herd fell to a 53-year low, according to the USDA.
Last month, pork prices were up 9.9 percent from year-earlier levels, the largest January increase since 1997, while beef rose 9.7 percent, the biggest jump since 2004, according to the Bureau of Labor Statistics.
Many analysts expect beef and pork to become even more expensive as $7-a-bushel corn discourages producers from expanding herds. Meat inflation is outpacing prices for most other foods, a concern for livestock producers because chicken production is rising and unemployment remains high. That may prompt consumers to buy cheaper meats, analysts have said.
Additionally, soaring corn prices are squeezing beef and pork producer margins, making any significant herd expansion unlikely, analysts say. On Feb. 18, corn futures in Chicago reached $7.15 a bushel, the highest price since July 2008.
Retail pork prices are expected to rise 3 percent to 4 percent in 2011 and beef is expected to rise 2.5 percent to 3.5 percent, according to a USDA forecast released in November.
Among specific cuts, bacon averaged $4.25 at retail during January, up from $4.16 in December and up 17 percent from $3.63 a year ago. Bacon hit a record $4.77 in October. Choice-grade, boneless sirloin steak averaged $6.27 a pound last month, up from $6.07 in December and up from $5.31 in January 2010.
For the broader food at home category, retail prices during January rose 0.7 percent from December, the largest increase since 2008, and rose 2.1 percent from January 2010, according to the Bureau of Labor Statistics, which is part of the Labor Department.
Thu, 24 Feb 2011 9:30:16 PST - Author: Bruce Blythe, Business EditorRetail meat prices in January rose the most in seven years, as last year's accelerating food inflation extended into 2011 amid smaller cattle and hog herds.
A meat price index tracked by the U.S. Bureau of Labor Statistics rose 8.4 percent last month on a seasonally-adjusted basis compared to January 2010, according to a Feb. 18 report. That was the largest year-over-year gain for that month since 2004. Meat prices rose 7.2 percent in December compared with year-earlier levels and have climbed an average of 7 percent over the past six months.
Beef and pork prices are climbing in part because livestock feeders cut herds after feed costs soared in 2008 and the recession hurt demand. Prices for slaughter-ready cattle and hogs last year rose 25 percent and 22 percent, respectively, based on Chicago futures. As of Jan. 1, the total U.S. cattle herd fell to a 53-year low, according to the USDA.
Last month, pork prices were up 9.9 percent from year-earlier levels, the largest January increase since 1997, while beef rose 9.7 percent, the biggest jump since 2004, according to the Bureau of Labor Statistics.
Many analysts expect beef and pork to become even more expensive as $7-a-bushel corn discourages producers from expanding herds. Meat inflation is outpacing prices for most other foods, a concern for livestock producers because chicken production is rising and unemployment remains high. That may prompt consumers to buy cheaper meats, analysts have said.
Additionally, soaring corn prices are squeezing beef and pork producer margins, making any significant herd expansion unlikely, analysts say. On Feb. 18, corn futures in Chicago reached $7.15 a bushel, the highest price since July 2008.
Retail pork prices are expected to rise 3 percent to 4 percent in 2011 and beef is expected to rise 2.5 percent to 3.5 percent, according to a USDA forecast released in November.
Among specific cuts, bacon averaged $4.25 at retail during January, up from $4.16 in December and up 17 percent from $3.63 a year ago. Bacon hit a record $4.77 in October. Choice-grade, boneless sirloin steak averaged $6.27 a pound last month, up from $6.07 in December and up from $5.31 in January 2010.
For the broader food at home category, retail prices during January rose 0.7 percent from December, the largest increase since 2008, and rose 2.1 percent from January 2010, according to the Bureau of Labor Statistics, which is part of the Labor Department.
