June 28, 2004

Prices Up For US Beef And Dairy Products

A strong demand for US beef and dairy products is affecting consumer prices as the Fourth of July holiday approaches, according to a survey of California supermarkets.

The California Farm Bureau survey showed higher average prices, compared with the results of a similar survey last year, for ground beef, tri-tip roast, all-beef hot dogs, milk, cheese and butter.

Local butchers put part of the blame for high beef prices on the Atkins diet craze, high gas prices, the mad cow disease scare earlier this year and other factors.

"Prices are extremely higher," said Paul Bagnasco, meat department manager at Shopper's Corner in Santa Cruz. "There's a high demand."

Ron Pinkham, meat manager at Deluxe Foods in Aptos, says prices have been high, but are getting weaker.

"With the beef program we're on with Harris Ranch, our prices are considerably higher than chain stores," he said. "But it's holding its own right now. We were paying a dollar and a half a pound more for ribeyes three weeks ago."

Prices for the complete summertime market basket of 21 food items in the survey averaged $49.35, up 15 percent from the 2003 survey.

Demand for American beef has stayed strong while supplies remain tight, affecting retail prices nationwide. But California Farm Bureau Federation President Bill Pauli said supermarket prices for milk and dairy products should soon begin to reflect decreases in on-farm milk prices.

"The average price that California dairy farmers earn for a gallon of milk will drop 33 cents on July 1," he said, "and we hope wholesalers and retailers will pass that along to consumers."