pork on the rise

Pork forecast

Yup it looks like production has slowed a bit, and prices may go up 10% by mid-summer.
Add to that the coupled effect of high beef prices and the Mad Cow fallout.

The good news, these price swings are always cyclical and things fall back to normal.

I haven't seen much of a rise here yet in spares or butts. I keep reading that it will happen, as consumers shift more towards protiens other than beef. The silver lining in rising pork prices is that even if they do spike, it takes a lot less time to get a pig to market wieght than it does for cattle. For that matter, every chicken in the country could die tommorrow, and the price would probably be stabilized within a few months.

What's killing me is the cost of beef. The trades report that US consumption hasn't really suffered in the wake of BSE news. I tend to believe them, as I've not experienced any downtrend. My supplier tells me that we ARE, in fact, importing some beef from Canada. The US is not exporting much beef at the moment, due to BSE. So, one would assume lower prices due to decreased demand, right? Well, I'm told that my brisket prices will rise again next week. The reason given... the US cattlemen are holding herds from slaughter to keep prices high. Is my distributor rep full of it? I've heard this from more than one source. If this is indeed the case, can we expect a drop in price when all of these "held" cattle reach the market? After all, you can't keep feeding a cow forever, and still turn a profit.

Is it possible that the cattle ranchers expect that they can turn these cattle to market once the export market opens back up, thereby offsetting the glut of supply with matching demand? I don't know the answers to any of these questions, just trying to figure out why I'm pumping an extra 70 or 80 gr. a year into my beef costs.

I think one thing that could really turn the US beef market is the finding of a half dozen or more cows that are infected with BSE in the US. I think that WOULD be enough to drive prices down, but at that point I think we'de all be feeling the effects of reduced beef consumption.

I'd like to get the inside scoop on this issue, but anyone who REALLY has all these answers either has a crystal ball, or is probably too busy to check this forum because they are getting ready to make a fortune on the futures market.

Excellent points Matt. It's interesting to note that the ranchers, wholesalers and retail outlets (grocery stores) all claim that their margins have shrunk and are getting smaller. Who does that leave? The processors. Slowly but surely over the years, the big ones gobble up the smaller ones, leaving less & less competition. Simple ecomomics tell you that those who control the supply, control the price. It would seem that the beef industry has taken a page out of the petroleum industry play-book.

With prices being as volatile as they have been, I am always checking at foodservice.com, they have weekly market reports which help give you an idea where things may be headed. But, as always, local markets will be different everywhere.