Up, up and up.
That's been the trend for U.S. beef prices following market conditions that have seen the nation's beef herd dwindle to a 62-year low. That event was spurred by a long run of high feed prices combined with Western droughts that caused ranchers to cull herds instead of taking a loss on producing beef. That culling trend finally caught up with markets this past year and caused cattle prices to soar to record prices.
With consumers' appetite for beef - particularly ground beef which accounts for 42 percent of all beef sales - the question some have been asking has been, "When will consumers push back on high prices and buy less beef?"
There is some indication that happened in December. Live cattle prices reached $1.71 per pound last November. Since then, those live cattle figures have been off 5 percent in what should be one of the traditionally strong sales opportunities during the holiday season. Not only are American consumers pushing back, but so, too, are international customers as October beef exports were down 2.2 percent from this same time last year.
While no one is projecting a wide scale about face in beef consumption, consumers just might be moderating their purchases due to high prices. That means dairy producers should lower their expectations somewhat after experiencing cull cow prices that approached $1.20 per pound and checks from high-end bulls' calves as high as $5 per pound. Those prices could have been the watermark.
