October 31, 2007

Drought to hike prices of US beef

A drought that scorched the Southeast region this year is going to cost Americans at the beef counter.

The dry spell wiped out hay crops across the region, forcing cattlemen from West Virginia to Alabama and from Maryland to Kentucky to sell large numbers of current and future breeding stock this fall. The region produces some 30 percent of the calves sent to US feedlots and experts predict it will take three years or more for the nation's beef supply to recover.

While the US Department of Agriculture doesn't keep regional statistics, market reports for Southeastern states show higher numbers of cattle are going to market this fall.

According to Tennessee Cattlemen's Association Vice President Luke West, people are selling are healthy four to six-year old cows which is the calf crop for the next seven or eight years.

National Cattlemen's Beef Association spokesman Joe Schule said it will ripple through the industry until breeding animals are replaced. He said the drought's impact on the normally vibrant cattle economy will definitely ripple the cattle herd which will hurt consumers.

That will hurt consumers, Schule said, because supply is a big factor in the price of beef.

Just how much the drought will cost consumers is uncertain because of other factors, such as grain prices. Meat prices have already climbed because of higher demand and rising grain prices. The Bureau of Labour Statistics says the price of ground beef rose 6 percent from January through September, roasts are up 5 percent, steak has risen 4.47 percent and all other beef is up 2.95 percent.