April 5, 2010

US domestic beef demand picks up in 2010

Beef demand in the US is expected to stabiliSe as economy slowly recovers this year.

Last year, the US retail beef demand index was the lowest since 1999, representing a fall of more than 4% from 2008, according to the Livestock Marketing Information Center (LMIC). Since the most recent peak in the index, which was in 2004, the decline has been about 14%.

LMIC points toward the severe global economic recession as the primary factor for the decline. Consumers were especially cautious about buying higher value beef items when faced with decreased income and job uncertainty.

The trend of large year-to-year declines in retail beef demand is forecast by LMIC to end as the economy slowly begins to pick up in 2010. However, consumers are expected to remain selective and price-conscious. The slow growth in demand will put a "cap" on how high beef and cattle prices can be supported by supply reductions, LMIC says.