CME: Slight Drop in November Retail Pork Price20 December 2013
US - Retail beef prices set yet another record in November while prices of other proteins moderated slightly from October levels, Steve Meyer and Len Steiner report.
That is broad takeaway from November retail price data released this week by USDA’s Economic Research Service. The monthly data for nominal prices for January 2000 to present appear in the top chart below. The bottom chart shows the same prices series deflated to 2000-2002 dollars.
Some highlights from the most recent data release are:
- Continued strength for both beef price series. The Choice grade average retail price for November was a record-high $5.409 per retail pound. That broke the previous record set in October by 5.4 cents/pound. It was also 5.9 per cent higher than the Choice beef price one year earlier. Meanwhile, the All-Fresh beef price (which included Select grade, no grade and store grade product) sold for an average of $5.014 per retail pound, up 3.7 cents/pound from October and 4.5 per cent from one year earlier. November marks the first time ever that the All-Fresh price has been above $5.00 per pound.
- The average retail price of pork fell slightly (3.3 cents/pound) from October’s record high or $3.809 per pound to average $3.776 per retail pound in November. Though off from the record level, the November price is still up 8.6 per cent from 2012.
- The average composite broiler price for November was $1.956 per pound, down 7.5 cents/pound from October’s record-high and under $2.00 per pound for the first time since July. The November price was just 1.1 per cent higher than one year ago and follows two straight month of over 8 per cent year-on-year chicken price increases.
- The retail turkey price fell for a second month from its September record high. The average price for November was $1.721 per pound. That compares to $1.77 in October (down 3.8 per cent) but $1.488 per pound one year earlier (up 15.7 per cent). That kind of price increase would normally be cause for a big celebration but it likely took another significant year-on-year cut in per capita turkey availability to get it done. We say “likely” because we do not have November production or export data yet. Per capita turkey availability declined, on average, 4.3 per cent from year-ago levels from May through October.
While nominal meat prices are clearly at or near record highs, such is not the case for deflated prices — but one must look back a long time to find comparable real prices for beef and pork. Real prices, of course, are what we use in our demand index and real per capita expenditure calculations and represent prices in constant (in this case 2000-2002) dollars.
Beef prices are back to the levels of the early 1980s when beef demand was under assault over concerns about fat and cholesterol content. Real pork prices are back to the levels of the early 1990s. It is reasonable to note that while the real prices of the two “red” meats are just getting back to the levels of 20 and 30 years ago, real per capita disposable income has been 89 per cent higher than in 1982 and 55 per cent higher than in 1990.
Bottom line: Much higher incomes. Same prices of beef and pork. Wonder where all the money came from for those flat screen TVs and smartphones?
The story is different for the poultry species, however, where deflated prices are still well below their levels of the early 1990s and, in the case of chicken, even the early 2000s. Real turkey prices have risen pretty sharply since 2008 as higher feed costs were felt more acutely there.
But the general decline in real prices for poultry is impressive to say the least, especially when compared to the general long-term performance of those companies. As with all industries, not all have fared well all the time but they have done well enough to innovate and steadily push selling prices lower. That’s an admirable feat in anyone’s book.
ThePigSite News Desk