Meat demand declines on recession fears
As the recession gets worse, people are eating less beef, pork and poultry, leading to the biggest decline in meat consumption since 1982, an industry analyst told the Kansas Livestock Association.
Hundreds of cattlemen gathered together for the group's annual convention amid fears over a global credit crisis and concerns about stricter environmental regulation under the Obama administration.
Consumers have already begun buying cheaper cuts of beef this year, CattleFax analyst Randy Blach said.
Per capita consumption of chuck was up 10 percent, while consumption of more expensive loin was down 7 percent so far this year, his statistics showed.
Blach added that Cattlemen on average lost US$130 a head for their cattle this year.
The global demand for beef will outstrip supplies, though the recession may slow that demand and the global credit crisis will take months to stabilize, he added.
US cattlemen now have the smallest cattle herd they have had since 1962 and it is expected to shrink another 2 percent next year, he said. But beef production remains strong because of heavier carcass weights due to improved genetics and nutrition.
Blach's outlook for next year was also grim. He forecast livestock inventories to continue shrinking and per capita meat consumption to decline. He also expected costs to remain high, with tighter profit margins.
However, Blach also anticipated US beef exports to increase next year by 27 percent because of a full year of access to Korean markets.