I love to grill. And if you are grilling on a budget, you have noticed a recent spike in meat prices. June 2022 marks the first time that Chicken (Boneless Breast) is now more expensive than a Pork Chop (bone in). USDA Choice Sirloin Steak also continues to outpace the other grilling meats in its per unit cost inflation. It is now more than 2 times more expensive than Chicken and Pork. Lean Ground Beef is now 2/3 the cost of Steak. This marks the greatest disparity in recent history (outside of a single month blip during Covid). All costing data from the USDA which updates monthly.
In this article, we will look at meat prices and what drives them. Our objective is to help you grill kings plan out your most cost-effective meat related meals, while also giving you the background on the economics of meat.
Chicken Prices
Prices of wholesale poultry have doubled recently. A wholesale broiler (chicken) ended last year at a cost of 89 cents per lb. That same chicken is up to $1.14 per lb in August of 2022. The August number pulled back a bit from $1.29 per lb over the summer of 2022 which equated to 45% inflation!! There are several factors playing into this spike.
- Covid – Covid shifted how we ate chicken. A large portion of chicken consumed in the US came from Restaurant and Fast-Food outlets. In Covid this was shut down for a period pushing people to grocery stores to get their chicken. Grocery store chickens are smaller than those sold to Restaurants. This change in demand resulted in producers shifting to the smaller birds rather than growing them larger. As we have reopened, demand has moved back to the restaurant space calling for the larger birds and producers are working to rebuild that flock.
- Shifting Demand – The U.S. has seen a shift from “bucket chicken” to Chicken Sandwiches over the past few years. This has put extra demand on the breast meat, again shifting the demand from the whole bird to a portion. In an article from “The Poultry Site”, David Anderson, Ph.D., AgriLife Extension economist at Bryan-College Station in Texas, said the following about shifting demand; ‘“There is plenty of chicken, but when you have all these chains making chicken biscuits and chicken sandwiches, which are a hot product right now, and they’re all made of chicken breasts, there is only so much of those specific cuts to go around.”’
- Feed Prices – This article from KCRA3 in Sacramento, talks about food inflation in general and sites that chicken prices are primarily driven by the cost of feed. ‘”Corn is what really drives the price,” said Bill Mattos, president of the California Poultry Federation. Mattos said 60% of the cost of producing chicken is in the corn feed. He said shortages and shipping issues are also factors of rising costs.”’
Pork Prices
I was surprised to see a Pork Inflation Calculator online. It amazes me what can be found online. After playing around with this, it shows that Pork has under performed to general inflation over the past 90 years. This trend remained in the near term (2015 to current). As we mentioned in our open, the cost of a Bone In Pork Chop is now lower than a Boneless Chicken Breast for the first time in our measurement (2015).
This said, Pork is not immune to inflation in 2022. The Bone in Pork Chop has seen a 7.1% increase in cost from $4.22/lb in 2021 to $4.52 in 2022. Pork has a large export market component to consider. The USDA suggest this will soften in the back half of 2022 and first half of 2023 due to the strength of the dollar. This softening should hold prices down, relative to its meat brethren, but like chicken some of this tepid demand will be offset by rising feed prices.
Beef Prices
Beef has some unique pricing components that break trends with Pork and Chicken. Like Pork and Chicken, Cattle prices are derived by demand, feed prices, but also energy and weather conditions are an important component. Droughts in the west have driven up the cost of cattle and the increase in diesel is affecting all components of transportation.
US News reports that farmers are reducing herd sizes by 2% related to drought. This will have lasting effects suggesting that Beef prices will remain inflated in 2023 and 2024. Expect Steak and Ground Beef to remain at significant premiums to Chicken and Pork.
Meat Prices and What to Grill
As grain prices subside coming off the spike from the Ukraine war, we should see some relief in feed prices for all the meats. Pork has the brightest of short-term outlooks from the consumer standpoint. Experts suggest U.S. prices should remain stable in the near term. Beef has the bleakest of consumer outlooks, as prices are poised to continue to rise in the next few years. We will follow-up on this article occasionally to see how these predictions play out. But for now, Pork is your cheapest option for the near term. Enjoy and happy grilling!