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

STRONG beef demand at home and abroad is without doubt the top story of the year so far for the United States beef industry.

Consumers have kept buying beef despite record high retail prices. This in turn has enabled cash live cattle prices in the US to set new record highs for seven straight weeks.

But demand at home will now start to be tested as retailers increase their everyday beef prices and feature beef less aggressively to reflect the record-high live cattle prices and beef cutout values.

The US’s biggest holiday week and weekend for retail beef sales is Memorial Day (on May 26 this year). It caused wholesale beef prices to enjoy a huge rally in May.

But that is now behind the market. The July 4 Independence Day holiday and the week leading up to it is the second largest retail beef sales period of the year. But high wholesale prices mean that retailers will primarily feature ground beef, while featuring more pork and chicken items to put on the grill.

April’s All Fresh beef retail price averaged US$8.50 per pound, up from US$8.42 per pound in March and up 6.9pc from April last year. April’s USDA Choice beef retail price averaged US$8.83/lb, up from US$8.75 in March and up 8.3pc from April last year.

These were both new record high prices. In contrast, April’s pork retail price averaged US$4.91/lb, down from US$4.95 in March but up 2.1pc from April last year. April’s chicken retail price averaged only US$2.06/lb, the same as in March but up 5.6pc from April last year.

North American beef demand: “Good/great news story”

It’s easy therefore to make the case that retail beef demand in the US will suffer in the coming months as retail beef prices keep setting new record highs and the prices of the competing meats remain far below those of beef.

Looking at North America, beef demand in Canada can be viewed as a good news story, while US beef demand can be viewed as a great news story, says Canadian market analyst Kevin Grier.

Based on beef production and trade and population data, per capita beef consumption (pcc) in 2024 can be estimated. Based on that data, it is estimated that per capita beef consumption in Canada declined about 3pc last year to hit just over 23kg on a carcase basis. That consumption was the lowest value on record and was more than two times smaller than the largest pcc of 52.75kg which occurred in 1976*, he says.

Coinciding with the very low Canadian consumption last year was record high retail beef prices that increased 8pc, says Grier. Beef prices have increased 38pc over the average in 2019. Prices increased more than chicken and pork last year and since 2019.

When consumption and deflated consumer beef pricing are tabulated, it shows that Canadian beef demand increased about 2pc last year compared to 2023. Despite the decline in pcc, beef demand, which includes price, increased last year, he says.

US beef consumption increases

While Canadian beef consumption declined by 3pc last year, US beef consumption increased by 3pc, says Grier. When combined with a 5pc increase in the US beef consumer price, it translated into a 5pc increase in demand in 2024.

The definition of improved and robust beef demand

US beef consumption was higher than at any time from 2011-2021 despite much higher prices.

This is the definition of improved and robust beef demand. US beef demand is the engine that is powering cattle prices now. If it was not for consumer demand, there is no chance that cattle prices would be close to where they are today, says Grier.

International demand for US product

Meanwhile, demand for US red meat is at record levels in many international markets, even in the face of heightened competition.

This was the message from US Meat Export Federation President and CEO Dan Halstrom to USMEF’s spring conference. A lot of times the best defense is a strong offense, and in many key markets, USMEF is doing both, said Halstrom.

It is defending where necessary, especially against newcomers like Brazil, which has recently gained greater access in several key regions. But at the same time, USMEF is aggressively pursuing new opportunities in both established and emerging markets, he said.

As an example, Halstrom pointed to the recent expansion of USMEF’s staff presence, with new representation in West Africa and Malaysia, and an additional staff member in Indonesia.

He also shared video highlights from USMEF’s recent two-day trade seminar in Accra, Ghana, which attracted buyers from 12 African nations.

Halstrom concluded by comparing USMEF’s approach to international marketing to the insights shared recently at Berkshire Hathaway’s annual shareholders’ meeting. He noted that Berkshire’s leadership views holdings in markets such as Japan, for example, as investments of 50 years or more, focusing on company fundamentals rather than being distracted by short-term issues that dominate headlines.

That is really what USMEF also does, focusing on the long-term vision of building demand in targeted export markets, said Halstrom. Global populations are growing and the middle class is expanding but it’s really about the spending power. USMEF is not focused on all consumers, he said. It is focused on the top tiers in these markets and those top tiers want and can pay for high-quality protein.

Despite there being a lot of noise about international trade, USMEF is going to keep its eye on the ball and remain focused on the long term, he said.

* Editor’s note: 1976 was in the middle of the ‘Beef Slump’ era, when both US and Australian herd sizes rocketed to record highs, pushing beef prices lower and consumption to previously unseen highs.