September 10, 2008

US beef and pork demand were down for the first seven months of the year while chicken demand crept up a mere 0.8 percent, according to industry economists.

The results were based on a demand  index calculated by University of Missouri economists Glenn Grimes and Ron Plain.

Domestic beef demand dropped 3.7 percent, pork demand was down by 3.9 percent, chicken demand up by 0.8 percent and turkey rose 3.5 percent from a year ago.

Economists in the weekly Cattle and Hog Outlook reports said January-July demand for live hogs jumped 8.9 percent beyond last year, while demand for live cattle rose 1.5 percent in the January-July period. The report noted that net beef imports declined to 3.6 percent from 7.9 percent during the same period last year.

The economists said current cattle futures prices might be too optimistic; noting that the beef supply in the first half of 2009 is expected to be down 1 percent to 2 percent, which means demand would have to increase 4 percent to 5 percent to achieve current futures prices.

Despite the evidence that cash-strapped consumers are opting for cheaper protein alternatives, demand for live cattle and live hogs rose in the same period, buoyed by strong exports and smaller imports.