One of my favorite activities during the summer is grilling. My second favorite summer activity is eating what I cook on the grill. My wife encourages this activity since it gives her a break from cooking dinner and, since I am doing it outside, I don’t mess up the kitchen too much. I have a stack of grilling books and magazines filled with a variety of recipes. Often these call for spices and sauces we don’t have in our pantry so off I go to the store to purchase the items for my latest culinary adventure. While making my selection, price is certainly a consideration, but so is quality. Grilling is a great pastime and one that can be shared with family and friends — at least the end result can be. But our fear-mongering media is trying to scare folks that there will not be enough beef for their grills this summer or that the price of steak will be higher than their house payments.
Two of the biggest grilling days of the year are just ahead of us: Father’s Day and Independence Day. Coincidently, retail beef prices (which have been on the rise since 2009) are peaking at new record highs just as these holidays are occurring. This month, ground beef is averaging $3.50 per lb and steaks are averaging about $4.81 per pound. This is not the first time in recent years we have seen a dramatic jump in beef prices. In 2010m ground beef increased about 50 cents per pound, and between 2009 and 2011 the average price of hamburger rose almost one dollar. Beef prices also took a jump between 1986 and 1989 and between 2002 and 2004. In almost all of these cases, the cause was the same: the weather.
There are many factors that impact the price of food, but one of the largest is the weather. Weather has an impact on almost all of the raw materials used to produce the food items that fill the shelves of our grocery stores. Meat, milk, butter, cheese, eggs, grains, fruits, vegetables, spices, and oils are all affected by the weather. Some of the other large factors that impact the price of our food are transportation and refrigeration. I can’t think of three more unpredictable and uncontrollable factors than the weather, oil prices, and energy prices. So when you hear someone blame high food prices on farmers, farm policy, or ethanol, just laugh in their face and invite them to go shopping almost anywhere else in the world where their food dollar will go far less.
Now while you are standing over your grill (which was imported from one of our trading partners) and grilling your $4.00 steak using either propane gas or charcoal (both highly processed energy sources), contemplate this: producing a pound of beef is a very long, complex, and expensive process. Contrary to urban myth, steers don’t just pop out of the ground fully grown, munching grass, and waiting to be turned into grillable meat. Even before a calf is born and begins its journey to your meat case, a lot of people, preparation, and investments have been made to make that magical moment possible. After about 2 years when said calf is market weight, the farmer/rancher finally gets his payoff and the wholesale processor takes over turning that animal into a cut, trimmed, inspected, packaged, and labeled meat item that is then delivered to your local food store where it is kept clean and cold until you are ready to buy it. Just think about the number of people, processes, technology and investment it takes to put a cut of meat on your grill. And, keep in mind all those people, processes, and technology have to generate a profit because food production is a business not a public service, at least not yet.
The current increase in beef prices is due to a drought that has hit western beef producing areas of the US for the past 2 years and a drought last year in the Midwest which cut corn production and increased the cost of livestock feed. The use of corn for ethanol or the Renewable Fuels Standard (RFS) are not factors in the current beef price spike. A government report last week showed that US ethanol supplies are at the lowest level in 31 months and that domestic ethanol production is down. In fact, according to the Energy Information Agency, the US had to import ethanol last month to meet domestic demand. So despite media reports and cattlemen complaints, beef prices are not higher because we are using more corn for ethanol.
While beef prices are at historically high levels, other meats, poultry and even pork have begun to return to more normal prices. Beef prices will also return to pre 2010 levels, it will just take longer because of the longer production cycle of cattle. So if $3.50 hamburger busts your budget, try some ground pork or turkey.
It amazes me that a 50 cent jump in hamburger prices over a 6 month period of time generates lots of finger pointing and massive media coverage, but a 50 cent jump in gas prices over a weekend goes without notice. Americans have very high standards when it comes to the variety, freshness, color, packaging, safety, and taste of the meat they buy. Yet many gripe about having to pay for these high standards. As you flip that USDA inspected, certified Angus steak on the sizzling grill this summer, ask yourself which is the better value, that great tasting $4 piece of meat you are about to serve, or the bottled water you will serve with it that costs $10 a gallon.
by Gary Truitt