02/22/23 Time to Fill the Freezer Again as Beef Prices are Set to Surge

As I talked about in a recent report, total U.S. cattle numbers decreased 3 percent year-over-year as of January 1 according to the most recent USDA cattle inventory report. The beef cow herd saw a decrease of 4 percent, dropping to levels not seen since 1962. With this reduction in numbers, consumers will continue to see beef prices increase at least through 2025. In the last two years, retail beef prices have increased nearly 15 percent, so two to three more years of price increases will be brutal for consumers.   It’s not uncommon to see beef purchases decline during an economic downturn, and there is no doubt that is exactly what our country is going through. According to the definition of a recession, two consecutive quarters of negative gross domestic product (GDP), our country had been in a recession during the first and second quarters in 2022 before growth returned. This fact coupled with raging inflation and increased interest rates forced consumers to reevaluate their spending habits. Choice/Prime Beef is often considered a luxury item, so it’s an easy choice for consumers to trade down to a cheaper protein option, such as chicken or pork. Some consumers might not…