Beef Prices Rise-Lima News – Ohio News Time
Beef prices have risen 30% since the start of the pandemic, and Raleigh Dennis is in the red.
“It’s an outrage,” Dennis said after a recent grocery sale.
Atlanta retirees have said they love the beautiful beef tenderloins on the table.
Inflation is driving consumer goods prices up almost entirely, with coronavirus closings and other fallout accused of running out of everything from wood to computer chips. Supermarkets are another place where pandemics have been surprised by Americans.
Since 2019, Chuck Roast has risen nearly 29% to $ 6.80 a pound. Ground beef is currently at $ 4.68 a pound, up nearly 23%. According to the Department of Agriculture, $ 10.59 per pound of sirloin steak is up 30%.
Beef prices are rising so rapidly that even Congress is wondering why. We hold public hearings and promise to legislate on transparency. The industry says market power drives up prices, but ranchers, retailers and consumers are skeptical of the record profit margins of meat packers.
The North American Meat Institute, an industry group, has been assessed as COVID-19 has hit meat packers at new costs, including providing employees with personal protective equipment and readjusting factories with protective screens. The document indicates that it has increased. Slowing or closing slaughterhouses due to disease has reduced production, and the pandemic has also increased transportation costs due to a shortage of truck drivers.
At the same time, the demand from American and foreign buyers is increasing. And, like the Georgia Chicken Processing Plant, beef stuffers are forced to pay higher wages to hire workers.
Hedgers Edge’s Andy Gottshchalk said prices were rising due to an unusual market.
“They became record profit margins without their own genius,” he told the Atlanta Journal-Constitution.
The four largest beef packers, Tyson Foods, Cargill, JBS and National Beef Packing, dominate 80% of the market. As of the spring of 2020, Hedges Edge estimated that they made $ 1,000 for each cow transformed into a box cut. Over the past few months, it has been in the range of $ 300 to $ 400. However, it was under $ 200 for most of 2018.
Financial information for JBS, National Beef and Cargill was not available according to a third quarter document filed with the United States Securities and Exchange Commission, but Tyson reported operating profit for the first nine months of 2021 in 2020. He indicated it was $ 2.4. billion more than in the same period. Commission. Beef sales boosted him, he said.
But higher prices don’t mean cowherds like Cleeve Jackson, who live in Floyd County, Ga., Are earning more. His price for live cows hasn’t fluctuated more than a penny or two from the $ 1.40 a pound he earned in a recent auction.
Beef is Georgia’s fourth-most profitable commodity, according to 2021 calculations from the University of Georgia, earning ranchers $ 661 million. Only broilers, cotton and timber are more profitable.
The beef industry is one of the most integrated segments of agriculture. Most Georgian cattle are shipped to the Midwest to feed more for fattening. Feedlots raise them to slaughter weight before selling them primarily to the four major meat packing plants in the Midwest. Integration has its advantages, but it also has its disadvantages.
Wendium Sawadgo, assistant professor and farm expansion economist at Auburn University, said consumers will benefit from integrating meat packers to help lower production costs.
“But processors have market power, so we can’t pass all the reduced costs on to consumers,” he said.
Some of the inconveniences caused price fluctuations in the country. A fire in August 2019 shut down the Tyson plant, which produces 6% of all American beef, for a month. Last June, JBS was hit by a ransomware attack and had to temporarily shut down its factory. This was 20% of the processing of American beef, which contributed to the shortage.
According to Sawadgo, a shortage means higher prices.
This game between shortages and prices has caught the attention of ranchers and retail lawyers.
Fred Gretsch, who runs Gretsch Brothers Angus in Oglethorpe County, Georgia, near Athens, said: He fears they have the power to dictate rather than follow the power of the market.
“When the fire started, they were able to do two things,” said Gretsch. The slowdown in production led to a resumption of livestock awaiting slaughter, creating excessive prices for livestock.
“They were able to drive up the price of beef in the market for end users and push back the men who feed them, the feedlot and the veal producers,” he said. ..
Pricing proceedings in Minnesota and Illinois allege that meat packers’ production slows during times of high demand. The meat packers have denied this claim.
The White House and members of Congress are also monitoring what’s going on with the price. Agricultural and judicial committees are holding hearings calling for price transparency and how the structure of large corporations deals with ranchers and feedlot owners. Lawmakers are discussing deregulating small-scale or rural slaughterhouses and providing start-up or expansion grants to increase competition.
The White House also said that President Joe Biden’s administration “enforces antitrust laws, encourages competition in meat processing, and increases pandemic profits that hurt consumers, farmers and ranchers across the country.” The statement was released on September 8.
The North American Meat Research Institute has blamed COVID-19 and called on government officials to stop the industry scapegoat.
Despite the price hike, people are still buying beef and meat, and prices are expected to remain stable until at least 2022.
Jackson sees this for the long haul. He has a full-time job in drugstore sales, so he doesn’t rely on cows to achieve his goals. He wants to keep doing it and at least earn enough to pay for the farm road.
“I am a third generation farmer. Hopefully there will be a fourth generation behind us, ”he said.
Cleeve Jackson stands by her cow on September 24, 2021 at her cave source ranch.