Thanks to a drought across much of the major cattle-ranching states and a deadly pig virus, we may soon be doing what those pesky Chick-fil-A cows are always encouraging on the billboards: "Eat mor chikin." Or veggies. Or tofu.
The United States Department of Agriculture reports that beef prices are the highest they've been since 1987, and pork prices are up 13 percent from last year, just in time for the start of grilling season nationwide.
David Anderson, a professor of agricultural economics at Texas A&M University, tells NPR that the reason behind higher-than-average increases in beef costs is in large part drought, particularly in Texas, the nation's largest producer of beef cattle. Drought leads to fewer feed crops, which leads to fewer cows. Coupled with an increase in demand for American beef in China, we're looking at a small supply and big prices.
According to CNN, the price of a pound of ground beef is now $3.55, which is abnormally high, even when adjusted for inflation. Round steak was up to $5.28 per pound on average in February, five percent higher than the previous month.
"The way the market is, I don't see anything going down," says Ronnie Killen, chef and owner of Killen's Steakhouse and Killen's BBQ. "Beef prices have gone up anywhere from a $1 to $2 per pound across the board. Pork has almost doubled on some of the cuts."
In spite of this, Killen says he hasn't had to raise any of this prices--yet.
"I've just been eating it," he says of the loss of profit. "I haven't been open long enough at the barbecue restaurant to raise prices. If we sell beef ribs for $18 a pound, we break even. The only thing we've had to do is take beef ribs off the plate and make them a la carte."
Killen acknowledges that some people have been disappointed that they can no longer get the fabulous beef ribs on a fixed-price plate of barbecue, but he says most people have told him they feel like they're getting a great deal in general for the quality of the product.
"Fortunately, the barbecue place has been so busy that we've been able to hide it elsewhere," Killen says, referring to the need to pick up the slack caused by high meat prices in other ways. "If it stays like this for a year or more, then yeah, I might look at raising something, but at the end of the day, the place is making money. In the very first month, we made money, and it took the steakhouse four years to reach the same numbers. I don't anticipate anything going up."
The rise in pork prices isn't related to the environment or demand, but rather a virus that's been wiping out pig populations. PED, or porcine epidemic diarrhea, hadn't been seen in the United States prior to May of 2013, but since then it has spread to 27 states, including Texas. Scientists think it probably came from China, but because it's so new to American farmers, few know how to treat it--or stop it.
Craig Rowles, partner and general manager of Elite Pork Partnership, an Iowa farm that produces more pork than any other farm in the country, attempted to be proactive, training his staff to spot symptoms of PED and maintaining abnormally high levels of cleanliness to prevent transference.
Still, the virus hit his farm in November, according to the Associated Press, wiping out 13,000 pigs, most of them very young. The USDA estimates that because of the virus, the national pig population has decreased by three percent. It may not sound like much, but it has had a great impact on prices, particularly that of bacon.
It takes pigs about six months to reach an acceptable size to be turned into bacon, so expect it to take at least that long for prices to potentially drop. The cattle population may take longer to recover, as so much of that decline in numbers is the product of a drought that has no end in sight and increasing demand from overseas.
In the meantime, let's all start grilling tofu!
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