So what's the reason for the jump in prices? While many factors have contributed to this situation, one of the biggest has been exports of our product to foreign consumers. Beef and veal exports for March were 46% higher than they were one year ago! Leading the way for this increase is South Korea which imported over three times as much US beef in March 2011 as they did in March 2010. You may recall news stories about the Foot-and-Mouth outbreak in South Korea late last year. In order to prevent the highly contagious disease from spreading, over one million head of hogs and cattle had to be euthanized. This created a huge domestic supply shortfall. South Korea has turned to foreign trading partners to meet its growing demand for beef.
And where do we go from here? Growing demand from Asian countries for animal based protein diets and a very favorable currency exchange rate point to the fact that exports will remain high. (As a sidenote, we are now exporting beef at the same level we were in 2003 before concerns over BSE shut us off from many trading partners). Fortunately for consumers, we are also coming into a seasonal period of higher beef supplies which will moderate retail prices near term.
How have higher food prices affected your grocery shopping habits?