Explaining the rising cost of beef

Published 12:00 am Sunday, March 15, 2015

Without looking up all the official data, I am going to try a simple explanation of why beef prices are so high in stores. There are still un-retired government ag types who keep up with the tally of cows and hamburger meat. I’ll stick with generalities and round numbers.

I’ll start at the end rather than the beginning. In the end, the old supply and demand economics is the reason for current beef prices. The number of cattle has declined substantially over the last quarter century.

True, we eat about a third less red meat per person than back then. But if that was the only thing in play, beef would be lower, not higher in price. Population growth has kept total demand from falling nearly as much as individual demand. Simply put, herd reduction outpaced any lowering in consumption of beef.

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Backing up nearer the beginning, many small family farms in this part of the country moved through a common transition last century. They were diverse subsistence farms in the first half of the century that grew a little of a lot of things to eat; vegetables, eggs, milk, pork and beef. The family’s cash came from cotton. Then the cash cotton was dropped as mechanization demanded larger acreage to hang on in the cotton business.

A lot of farms became small beef cattle operations with income coming from off the farm. This utilized the land and kept it in the family. Forty years ago there were about twenty million more cows and calves than now.

Most of us ate all the beef we wanted and could even afford ribeyes more often than now. We had a beef oversupply.

That supply eventually pushed cattle prices below production costs and reduced cow numbers much more than any loss of demand.

In the 1970s a lot of people just went out of the cow business. For some, soybean rent became more profitable and a lot less trouble than cows. For others, family land became pine tree farms.

Also, as time went by, few children reared on small part time beef farms chose to stay put and tend a handful of cattle at little or no profit. They grew up and into good jobs and had better things to do evenings and weekends. Changing times changed family farms yet again.

Other factors lowered the U.S. cattle population to the point where demand is now higher than supply. Conservation and wildlife programs affected grazing on public lands out west as well as some private property in our area.

Increased property values have also pushed cows aside. Cattle were historically relegated to the lower value agriculture land. But look where much of the recent residential construction boom has taken place: in former cow pastures.

I had a hankering to be a cowman and got in the business during the 70’s. Cattle were dirt-cheap, interest rates sky-high and I was young and penniless. I guess maybe I was a success because I paid off every loan. Eventually.

Terry Rector writes for the Warren County Soil and Water Conservation District, 601-636-7679 ext. 3.