The UN Food and Agriculture Organization says its meat price index rose by 8 percent during 2014 while the other elements in its Food Price Index – cereal grains, vegetable oils, dairy products and sugar – fell. The index averaged 202 points for the year, down 4 percent from the previous year and 12 percent from the record set in 2011. It was the third year in a row that the index fell. Cereal prices registered the sharpest decline of the year, down 12.5 percent as farmers harvested bumper crops worldwide and the drought-shortened supplies of 2012 were replenished.
Short supplies and high demand in Europe and the United States fueled meat price increases in the past year. FAO says 2014 ended with a nearly 2 percent rise in its meat index for December with the strong U.S. dollar driving the increase. Pork prices were down in Europe and prices fell for beef and lamb from Oceania.
U.S. meat prices are forecast by USDA to rise by 4 percent this year, down from 8 percent during 2014. Beef soared in price by 11.5 percent last year and pork zoomed by 8.75 percent, setting records. USDA says “there are signs of (herd) expansion” by hog farmers, which would mean larger pork supplies this year. It takes six to 18 months to boost beef production and “signs of herd expansion at this point are anecdotal at best,” said USDA on Dec 23. Beef and pork prices in the grocery store are forecast to rise by 5 percent this year while poultry and seafood prices rise by 3 percent.
Americans spend 12.5 cents of each food dollar on meat, poultry and fish.