As corn and soybean prices continue to go up corn and soybean meal go up as well, and that increase in meat animal feed is about to make its presence felt at the grocery store. That’s the word from Purdue University and agricultural economist Chris Hurt.
Hurt says consumers of meat, especially beef, should see higher prices in the coming year. “When we go back and look at the period prior to 2007 when corn prices were averaging closer to $2 a bushel, we saw retail prices for beef during that time average about $3.84 per retail pound. Now we’re projecting in 2011 that we’re going to reach about $4.65 a pound, and maybe a considerable amount of that is related to the fact that feed prices to produce that beef are considerably higher in the last three years and eventually that has to get passed on to us in terms of our restaurant consumption as well as the dinner tables.”
Feed makes up as much as 60 percent of a livestock producer’s costs so with higher feed costs producers are getting very cautious about increased production. Hurt says herd size reductions can be expected.