031240 Beef Prices at Highest Levels in 30 Years

Blame it on mad cow disease. Or even the Atkins diet. The fact is, beef prices are at their highest levels in almost 30 years.

"We've seen beef prices reaching almost historic highs," said agricultural economist John Anderson.

Christine Holloway of Hattiesburg said she buys more beef products than other meat and has not noticed an increase in beef prices over the past couple of months.

"I have always bought beef products because there is so much more you can do with beef for dinner compared to other meats," said Holloway, who buys ground beef at least once a week. "I do look at the price of it each time I buy it, but it doesn't seem to be that much more. My total grocery bill is not higher, that's what matters to me."

While it has been a seller's market in the cattle industry, area grocers haven't been as grateful for the price increase.

"We've seen a trickle down effect of pricing," said Todd Lewis, E&B Discount Grocery manager. "We've had to pass it along to our customers."

Customers at the Winn Dixie supermarket on Lincoln Road recently found signs apologizing for the highest beef prices in 27 years.

Anderson, a Mississippi State University assistant extension professor, explained the all-time highs in the cattle market can be attributed to three factors: herd size, mad cow disease in Canada and consumer demand.

"We've seen a historically small cow herd this season," Anderson said.

In addition to fewer cattle, the discovery in May of mad cow disease in Canada closed that country's borders to cattle exports.

"Typically 10% to 11% of our supply of beef originates from Canada," Anderson said. "This is happening at the same time as smaller herd numbers just sort of magnified the effect."

While the United States does not import a large amount of cattle or beef from Canada, the impact has been seen in retail dollars and cents.

"It's not a great deal, but it does have some impact on our prices," said Sammy Blossom, executive director of the Mississippi Beef Council.

Canada's closed beef borders have bolstered the cattle market for America's producers, according to Lee Taylor, Forrest County's cooperative extension agent.

"It is helping our producers," Taylor said. "A lot of producers are selling their cattle instead of holding on to them."

An increased demand in export cattle has further helped farmers and boosted retail beef prices.

"When the Canadians lost their export business, we picked up additional export business in Japan and Mexico," Anderson said.

Consumer demand has also been on the rise, pushing this year's beef prices higher than ever before.

"We've seen a 10% increase in beef demand since 1998," said Blossom, who also serves as the executive vice president of the Mississippi Cattlemen's Association.

Blossom said the increased demand for beef is due in part to the marketing campaign whose slogan is "Beef, It's What's for Dinner".

"Consumers are showing a stronger preference for beef," Anderson said.

Farmers credit new diets sweeping the country for driving up consumer demand.

"The demand for beef has increased because of people going on high protein diets, like the Atkins diet," said Oak Grove cattle rancher Harold Traylor, president of the Forrest- Lamar Cattlemen's Association.

The Atkins diet calls for its adherents to eat more protein and fewer carbohydrates.

Traylor said he doesn't believe beef prices will remain at the high levels much longer.

"Prices will probably decrease in the next few months," Traylor said. "Cattle will probably come back in from Canada and that will probably decrease prices."

"We will rebuild our cattle numbers and prices will go down as they always do," Blossom predicted.

"We will see prices moderate some in spring and early summer due to more resistance to these higher prices," Blossom said.

Source: Hattiesburg American (Mississippii, USA)

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