Following years of tightening beef supply — and subsequent record beef prices — America’s beef farmers and ranchers are expanding their herds. USDA’s cattle inventory report shows inventory numbers have increased 1.4 percent this year and for 2016, industry analysts are forecasting continued herd expansion, as long as Mother Nature continues to cooperate. This means more beef is coming to market later this year and into next. As a result, grocery retailers and foodservice operators will have more flexibility and options when procuring beef products.
Throughout this time of higher beef prices, demand for beef has grown. In 2014, the wholesale beef demand index increased 18 percent and retail beef demand grew nearly 7 percent. Consumers have remained willing to spend more for the beef they want, even more so than for other proteins. The Oklahoma State University Food Demand Survey shows that consumers are willing to pay 34 percent more for steak than a chicken breast and 66 percent more for steak versus a pork chop. This strong consumer desire for beef is what sent a signal to beef farmers and ranchers to increase production.