There's been a startling decline in the amount of beef available to consumers in the United States. That's according to Purdue Extension Ag Economist Chris Hurt. It's a supply trend he expects to continue, but one that producers might buck in the short term in hopes of reaping the rewards of record high beef cattle prices this year and next.
"In terms of prices we think finished cattle prices will reach their lows in the late summer, probably late August," Hurt said. "That's going to be probably in the $106-$110 per hundredweight range, pretty close to where we are right now. As the weather cools moving into September cattle prices are expected to rise seasonally and average about $112-$116 in the in the final quarter."
For the entire year, that would put the average price at a record setting $110 to $112 per hundred pounds. Hurt is forecasting second quarter prices next year to average $3 to $8 above those prices. Hurt says the clear message is for beef producers is to hold on to their cows as the beef industry has a positive outlook for years to come.
This positive outlook comes along with a decline in the number of pounds of beef available per capita in the United States. There are fewer cattle in the U.S. and that means higher prices for consumers. They in turn are consuming less beef, but paying more for it at the meat counter. Half a dozen years ago, the average U.S. citizen consumed about 65 pounds of beef a year. That number will be down 15% or by about 10 pounds per person by the end of 2012.