Americans faced relentlessly higher beef prices at the grocery store in 2014 and 2015 due to drought, tight supplies and high demand. Shoppers will get a break this year, with retail prices forecast to dip 1 percent, says the monthly Food Price Outlook. It would be the first annual decline for beef since 2009, when prices fell 1 percent, according to USDA data.
The strong dollar is constraining beef exports and keeping more meat on the domestic market. “This increased supply, along with weak demand, has placed downward pressure on retail beef prices,” said the USDA. “Additionally, favorable pasture conditions in some areas in 2015 and lower feed prices have allowed cattle producers to feed cattle longer and to hold cattle for herd expansion.”
Beef and veal prices during January were 5.7-percent lower than one year earlier, a sign of the softening outlook for prices. Retail beef prices skyrocketed 12.1 percent in 2014, when pork and poultry also set records. They climbed an additional 7.2 percent in 2015, as ranchers took the first steps to expand herds and, 16 to 18 months later, send more fattened calves to market.
Egg prices also are trending downward this year, said the USDA, forecasting an annual decline of 1 percent. During January, egg prices dropped 10 percent but they still are higher than a year ago. Prices soared last summer as a result of the bird flu that killed 11 percent of the hens producing eggs for table consumption, and by last June prices were nearly 22-percent higher than the preceding June. For 2015, egg prices were up an average of 17.8 percent. “As the industry recovers from this outbreak, prices at the retail level will continue to decline,” said USDA.
Meat and poultry production is projected at a record 97 billion pounds this year as beef, pork, broiler chicken and turkey output rise. “If realized, this would be the first time since 2008 that production of all major meats increase during the same year,” said USDA chief economist Robert Johansson at the annual Outlook Forum. “Table-egg production is expected to increase to 7.05 billion, almost 4 percent above 2015. However, this will be only the third highest production level after 2014 and 2013.”
Turkey production, also hit by bird flu in 2015, is forecast for 5.97 billion pounds, near the record 5.87 billion pounds of 2012.