Beef demand: More complex than you think
More beef will continue to hit the marketplace and demand will matter when it comes to getting it all sold. But a new study reiterates that demand is more complex than we may think.
By B. Lynn Gordon, BEEF Magazine
Feb 06, 2020
In 2019, the beef industry witnessed record numbers. In all, 26.4 million head of steers and heifers, plus another 7.1 million head of cows and bulls were harvested to produce record levels of beef in country. These production and slaughter numbers translate into 513 million pounds of beef a week filtering through the U.S. marketplace. With all-time record high pounds of beef being produced, the industry continues to be intent on learning as much as it can about beef demand.
Dr. Derrell Peel, Professor of Agribusiness at Oklahoma State University teamed up with former master’s degree student, Lauren Bell-Clark to study the complexities of beef demand. The study consisted of 30 interviews with representatives from 22 organizations across all segments of the beef industry, including distributors, further processors, retail, food service, and industry organizations. From the interviews the team gained additional information to better understand beef products, product flow and product interaction. Peel and Clark reported their results during the 2020 Cattle Industry Convention Cattlemen’s College held Feb. 5 in San Antonio, Texas.
“The goal of our research project was to take beef demand and dis-aggregate it into a lot more specifics,” said Peel. "Beef demand is not one thing, consumers do not buy beef, they buy specific beef products or cuts of beef and most of the time the biggest substitute for a beef product is another beef product."
In Bell's summary of the comprehensive research some of the key findings included the growth and predicted future growth of ground beef in the market place. Currently ground beef is 50% of the U.S. beef market consumption, but estimates are that it could grow to 62%. Growth is also being witnessed in bone-in products. She also reported retail continues to drive beef demand more so than food service, and exports are growing demand and price levels for cuts, particularly from the chuck.
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