A monthly column written for Beef Central by US meat and livestock markets commentator Steve Kay, publisher of US Cattle Buyers Weekly

 

 

 

I BEGAN covering the US beef industry 40 years ago. At that time, beef was under severe attack as the ‘unhealthy’ food that caused heart attacks, obesity and much more.

The industry survived those attacks by focusing on higher quality beef and its superior nutritional values in a balanced diet.

Remembering that time, it is amazing to realise today that beef is “The King of the Proteins” again in the eyes of many Americans. Beef demand in the US is booming, and two previously absent factors are causing it: the Make American Healthy Again movement, and new dietary guidelines emphasising the importance of protein in a balanced diet.

On top of that, tens of millions of Americans on GLP-1 weight management medications are adding more protein to their diet to retain muscle as they lose weight, as the New York Times wrote on November 2. 

One would think that rising beef prices would force consumers to switch to cheaper animal proteins like chicken or turkey. But think again, said a recent story in the New York Post.

Even as beef prices climb, two groups remain hungry for their favorite protein, the gym-obsessed and GLP-1ers, according to studies co-authored by Arizona State’s Morrison School of Agribusiness assistant professor Justin Bina. And both are willing to pay a premium to get their protein fix.

Bina’s report revealed that fitness-maxxers will spend up to US$1.91 more per pound for ribeye steaks from retailers and grocery stores and up to US$2.47 more at a restaurant.

The physically active population is a more reliable consumer base, bolstering protein purchases, he told the Post. Bina found that males were more frequently engaged in strength-based exercise, indicating that they consume protein intentionally to aid in their fitness goals.

Coach Dre, a 31-year-old natural bodybuilder and fitness coach from Ohio, told the Post that the cost of high-protein foods is an often-overlooked expense in the fitness world, where building muscle can mean spending more on food.

Dre himself eats beef four to five times a week, usually opting for a New York strip steak. Even as prices continue to climb, the Cleveland stud isn’t backing down. He shells out hundreds of dollars a month to hit his protein target, scarfing down lean beef several times a day, he told the Post.

Demand for protein has skyrocketed in recent years as American eating habits have changed, said the NYT.

The Make American Healthy Again movement and new dietary guidelines emphasise protein. Tens of millions of Americans on GLP-1 medications are adding more protein to their diet to retain muscle as they lose weight.

Companies have added protein to everything from cereals to Kraft Mac & Cheese.

But Americans increasingly want their protein through high quality beef. With the country’s cattle supply at its lowest level in 75 years, that demand has pushed steak prices to nearly US$13 per lb (almost A$41/kg) and ground beef to nearly US$7/lb ($22/kg). US steak prices are up 3.5pc in the last year and up 16.6pc in the last two, said the NYT.

The well-off among American consumers have never been more able and willing to pay for great beef, and it has the market outcome of raising the price, Glynn Tonsor, a livestock economist at Kansas State University, told the NYT.

The average American is projected to eat 59 pounds (27kg) of beef this year, up from a low of 54 pounds (24.5kg) in 2014. Still, the rising cost of beef, and groceries overall, has been a common talking point on the campaign trail in the lead-up to the US mid-term elections this month.

With the exception of chicken, consumption of other forms of protein hasn’t kept up with beef, said the NYT.

Chicken remains the cheapest and most consumed animal protein. Whole chickens cost just US$2 per pound (US$4.40/kg), while boneless chicken breasts are double that. It is favoured by those with health concerns about red meat, even though more recent studies suggest that some of those concerns are overblown.

In the early 1990s, Americans ate about as much chicken as they did beef, about 65 pounds (29.5kg) a year of each. Since then, chicken consumption has soared in the US, with people expected to consume on average about 108 pounds (49kg) this year. Almost all of that is from broiler chickens, birds developed to yield a lot of meat.

The cost of pork has remained about the same over the past five years, said the NYT. While consumers may be looking to eat more protein, they aren’t getting it from pork.

Pork chops cost around one third of what steaks do at retail in the US, but that hasn’t been enough to get more Americans to try them out. Pork consumption has essentially remained flat, around 50 pounds (23kg) annually per person, for 40 years, according to USDA data.

The cost of pork has remained about the same over the past five years, ranging between US$3.50 and US$3.75 per pound. Wholesale pork prices are falling and pork production is down slightly.

Pork sales also suffer more than other meats from high gas (petrol) prices. According to USDA, bacon consumption is a complement to restaurant meals and road trips, both of which slow when gas prices rise.

All of this suggests that chicken is the survival food and that beef is the Protein King and meat treat.