The Register-Herald, Beckley, West Virginia

Latest News

April 17, 2014

Video: Meat market

Prices for proteins — especially beef — are on the increase. Blame the weather, disease and China.

BECKLEY — The price of beef has everyone in a stew these days, and it doesn’t stop with the “what’s for dinner” protein. Prices of pork and chicken are on the rise, as well.

 

Beef prices are directly related to the size of the cattle herd, which, according to the Wall Street Journal’s online Market Watch, is at its lowest since 1951. Weather factors have played into the decline, as an early October blizzard last year killed tens of thousands of cattle in South Dakota and Texas is experiencing a drought — more than 75 percent of the Lone Star State is in severe to exceptional drought conditions — causing ranchers to sell off their herds.

 But in January, equities.com’s Andy Waldock reported that cattle on the hoof now weigh more, meaning more product for fewer animals slaughtered. Rather than balance the declining herd numbers, prices have continued to rise for normally inexpensive products like ground beef, and nearly exponentially for Grade A prime rib and rib eye steaks. Time reported this week that the February price of fresh beef averaged $5.28 a pound

Waldock reported that a growing middle class in China has a growing appetite for American beef, a trend that is expected to continue and “accelerate by 10 percent per year over each of the next five years.”

China purchased Virginia’s Smithfield meats last year for more than $4.5 billion to help feed the new demand. “Chinese beef imports through this year are 600 percent higher than last year,” Waldock reported.

Pork prices are expected to rise as much as 15 percent this summer, as the hog herd is diminished by a virus spreading through the Midwest. The highly contagious porcine epidemic diarrhea virus is fatal to piglets and will cause prices to be “significantly higher,” according to The Des Moines Register.

Priceonomics reports that beef consumption fell below chicken for the first time in a century, dropping to fewer than 60 pounds per capita in the United States.

Locally, prices are considerably lower than the national average, but still high enough to cause some customers at The Butcher Block in Beaver to have “sticker shock,” according to butcher Ralph Richmond.

Richmond, who has sliced the beef at The Butcher Block since 1977, is not without some sticker shock of his own, and while he’s trying to keep prices as low as he can, he’s balancing his own costs.

“(I’m) trying to hold prices down as cheap as I can, but I can only hold them so low and keep the lights on,” he said. “I’ve never seen a price like this; people can’t afford it.”

Richmond said beef prices began to rise after Christmas when a chuck roast was $3.99 a pound. Now, at $4.99 a pound, he said a roast could cost up to $20, when at Christmas it was $12, a 60-percent increase. Ground chuck costs $4.50 a pound. All cuts have gone up $1 a pound, he said.

Still people walk through the door at a fairly regular pace, and if the price is a problem, quality is the solution.

Vickie Hancock and her mother, Marie Catus, of Beckley came to the store for ground chuck, never batting an eye at the price.

“This is the best, I don’t care how much it costs,” Hancock said.

Catus, about to make a pot of chili to fend off the winter that wouldn’t end, said she’s been shopping at The Butcher Block for 35 years, and buys all her meat there.

“I’m willing to pay for the quality,” she said. “You can’t beat it with a stick.”

Richmond confirmed the causes of high prices to be a beef shortage and foreign exports, but he’s still hopeful that prices stabilize or at least return to normal nickel and dime fluctuations.

“I hope they don’t go no higher ; I hope the price will come down,” he said. “I’m sure with the price of beef, people are going to be reluctant to pay (for it) and maybe go buy cheaper stuff.”

As for his loyal customers, Catus among them, Richmond acknowledges they stop by his store with the worn, hardwood floors and the vintage meat showcases and freezers because they get what they pay for.

“People come here for quality,” Richmond said. “They do their grocery shopping in (big stores) and come here just because of meats.”

The Butcher Block also offers other meats, but neither pork nor chicken prices have risen to the extent that beef has, Richmond remarked. But he did say he’s heard of the virus spreading among pigs, and is preparing for pork chops to become more expensive, as well.

All of his beef is the grain-fed Midwestern variety, he said. Richmond doesn’t buy any locally grown beef for his shop. Because the state doesn’t have large cattle feedlots and the corn keep those cattle fed, Richmond said, the state doesn’t produce great quantities of grain-fed beef.

Fuel costs play into those Midwestern cuts, though, and Richmond said he pays a fuel surcharge on every box of beef shipped to Beaver.

Down the road in Daniels, Devin Billeter hasn’t raised his Dish Café beef menu prices because he relies on locally grown grass-fed beef for his burgers. Billeter and his partners, his wife, Tammy, Mark and Michelle Rotellini and Rosy Corley and Beverly Hall, use as many locally grown products as possible, he said, including ground beef from Swift Level Farms in Greenbrier County. Steaks are grain-fed Midwestern cuts, he said, because marbling in the meat makes it cook better at higher temperatures.

The partners are keeping those steak prices within what the market will bear, hoping to maintain a pretty loyal customer following as they enter their second year in business.

“We don’t want to scare them away,” Billeter said. “We still have the same prices on this menu as we did on the last one.”

Billeter said he’s heard rumors that pork prices will go up into next year, and he hopes that will help level out the rise in the price of beef.

But chicken? Chicken seems to be the more reliably priced protein staple, mainly because poultry’s growth period is a fraction of a larger animal’s.

“Chicken seems to be the life-saving protein while we ride this out, however long that may be,” Billeter said.

With a commodities market in such an upward spiral, running a restaurant and setting prices is bound to be tricky.

“Any time you have a commodity increase, especially in protein, it’s a challenge to the bottom line because you don’t want to gouge the customer,” Billeter noted. “We’re here for the community and we’ll do whatever we can to maintain the pricing at this restaurant.”

The locally grown angle has some lift, too, as customers look for meat choices that are guaranteed not to have hormones and antibiotics.

In Pocahontas County, Stompin’ Crick Farms offers locally grown beef, pork and lamb.

Farm owner and Marlinton Middle School principal Joe Riley said locally grown beef will eventually match the feedlot variety in price.

“If I slaughter it, I lose 50 percent of the weight,” Riley said. “It’s hard to readjust prices. A lot of times, it’s just shooting in the dark.”

Riley said the farm’s 40 customers generally get a variety box of meat, containing all three products, but he also has customers who purchase only the ground versions of each.

He and his wife Sarah, and children, James, Kayla, Silas and Hazel, are all hands-on farmers, with the kids growing into farm chores as they age.

The crew at Stompin’ Crick butcher eight steers, a dozen hogs and 16 lambs each year, with most of their sales coming in the fall of the year. The freezers are all empty now, as sales for locally grown meats have increased moderately.

Lamb prices have been pretty steady, and Riley expects his favorite will remain priced as it is for some time to come.

“I just like it better,” he said. “It has more flavor.”

— E-mail: ppritt@register-herald.com

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