Source: MEATINGPLACE, 1/26/16

Ample supplies of beef and an expected rise in pork production will keep retail prices for both proteins on a downward path in the coming year, USDA’s Economic Research Service (ERS) predicted in its 2017 Food Price Outlook.

Beef and veal prices paid by consumers declined 6.3 percent in 2016 as the increased pace of cattle slaughter, especially during the second half of the year, and higher carcass weights resulted in higher year-over-year beef production.
ERS predicts beef and veal prices will decrease an additional 2.5 to 1.5 percent in 2017.

Pressure on pork
Retail pork prices fell 4.1 percent in 2016, largely due to ample supplies of other animal proteins, particularly beef, available for domestic consumption.

With USDA forecasting a 5.1 percent increase in pork production in 2017, large pork supplies are expected to drive retail prices 1 to 2 percent lower this year, ERS said.

A chicken rebound?
Retail chicken price inflation remained relatively low into 2016 partly due to an increase in broiler production. The strong U.S. dollar also kept more broilers on the U.S. market, weighing on retail chicken prices.

Poultry prices declined 2.7 percent in 2016. However, as the industry recovers from lower 2016 retail prices, ERS predicts poultry prices will rise between 2 and 3 percent in 2017.

Wholesale prices
In 2016, farm-level cattle prices fell 19.4 percent and wholesale beef prices decreased by 15.5 percent. ERS expects farm-level cattle prices to decrease an additional 9 to 10 percent and wholesale beef prices to decline 7 to 8 percent in 2017.

Wholesale pork prices fell 1.9 percent in 2016 as litter sizes and hog inventories recovered, but ERS predicts prices will be flat to up 1 percent in 2017.

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