Burger Prices Soaring? Here Comes A Cheap "Test Tube" Alternative
Between fast-food staff demanding higher wages, weather-related excuses, central-bank-impacted energy/feed costs, and protectionist policies, consumers (rich and poor) of beef in the US could soon face dramatically higher prices. As Bloomberg reports, US beef production is expected to plunge to 21-year lows (falling for the fourth year in a row) and the 'herd' on July 1st was the smallest for that date since at least 1973.
Wholesale beef buyers from McDonalds (facing their own wage-cost demand pressures) to Ruth Chris are facing input prices rising at the fastest rate in almost 2 years even as agricultural commodities have dropped 18% this year.
The situation is not about to get better quickly either as it takes about 30 months to boost beef production - and given current levels through the feedlot chain, livestock analysts expect "some years of tight beef supplies." Bye bye Dollar Menu...and hello surging sirloin price... oh and there's no 'exporting' this inflation, a strong USD and additive-related restrictions means the world doesn't want what US ranchers are selling.
U.S. beef production is plunging to a 21-year low after surging feed costs spurred ranchers to cut herds, signaling record prices for consumers and higher costs for buyers
McDonald’s, ... probably will pay 2.5 percent to 3.5 percent more for beef this year, ... Retail ground-beef prices in June were up 13 percent from a year earlier and near a record set in January.
[McDonalds] will consider charging more for food, competition and price-sensitive consumers mean “we have less pricing power in 2013 versus a year ago,”
Beef costs for Ruth’s Hospitality Group Inc. ... climbed 17 percent over two years
It takes about 30 months to boost beef production, ... Returns have varied across the supply chain. A feedlot that put a 750-pound steer on a corn-based diet for about five months and then sold it at 1,300 pounds for slaughter lost $148 a head on average in 2012 and as much as $306 in July
Higher prices are curbing demand, with U.S. beef shipments tracked by the government down 2% this year through May. The dollar's rally to a three-year high in July is also eroding the appeal of U.S. exports and China and Russia are restricting meat with ractopamine, a feed additive that some U.S. producers use to increase lean muscle.
“You’ve got some years of pretty tight beef supplies,” said John Nalivka, a former U.S. Department of Agriculture economist.
The number of domestic cattle reached 89.3 million on Jan. 1, the lowest since 1952, according to the USDA.
But - there may just be a solution. From the Soylent-Green-like science-fiction pages, Al-Zazeera reports the world's first lab-grown burger to be cooked:
A group of scientists from the Netherlands will introduce the world's first in-vitro burger made in a laboratory.
The process involves taking the stem cells from cows and growing them in petri dishes until they have formed thousands of muscle fibres.
- advertisements -
- advertisements -