Retail beef prices are forecast to climb by 5.5 percent this year, double the overall rate for food inflation, says USDA’s monthly Food Price Outlook. “Most retail beef prices, on average are…at record highs, even after adjusting for inflation,” said USDA. Beef prices zoomed by 12.1 percent in 2014 due to the historically small cattle inventory. “Many producers are holding on to their inventory to increase live weights, as steer and heifer prices have hit record highs,” said USDA, so it will be months before beef supplies increase at the grocery store.
Pork prices, however, are forecast to be stable, rising by 2.5 percent this year, the same increase expected in food prices overall. Pork prices shot up by 9.1 percent last year, reflecting the impact of porcine epidemic diarrhea virus on herd size. “However, there are some signs of industry expansion as the effects of PEDV have been subsiding,” said USDA. The forecast assumes normal weather; USDA noted continued drought in California “could have large and lasting effects” on fruit, vegetable, dairy and egg prices on the one hand while low petroleum prices could benefit consumers by reducing food production and shipping costs.