Americans face higher food prices at the supermarket because of a drought this summer, but the increase will not have a lasting impact on inflation or the Federal Reserve's thinking on monetary policy.
USDA Livestock Analyst Shayle Shagum lays out the livestock situation:
“As we move forward and look at an increasingly tight supply of beef, we are looking to see choice beef prices move into the $5.00-$5.10 range for 2012.”
And more than $5.10 in 2013.
But, how high will prices go? That’s ultimately a question for retailers:
“How much can they afford to push prices forward to the consumer is the question.”
Before the consumer says ‘enough is enough’, much like 2010 when consumers turned to other sources of protein, such as peanut butter, and other non-meat proteins.
Farm Bill Being Held Hostage in House
Ag Secretary Tom Vilsack says whatever House Speaker John Boehner’s reasons for holding up the 2012 House Farm Bill – they aren’t good enough. He says Boehner’s argument last week that Crop Insurance is enough to deal with the worst drought in seven-decades leaves out all of the livestock producers in the country – which he says is hundreds of thousands of people…
“They aren’t good enough to justify delay on what is passed through the Senate and what is passed through the House Ag Committee in a bipartisan way with bipartisan leadership.”
Vilsack announced new administrative drought relief steps. USDA will encourage crop insurance companies to give producers a 30-day grace period to November 1st on unpaid premiums – allow haying and grazing on some CRP and other conservation lands.
But Vilsack says without much hay and with soaring feed prices – that’s just not enough…
“Some folks are beginning the process of liquidating their herds and they know full well that nothing else can be done beyond the steps we have taken to open up more grazing areas. The sad reality is that congress needs to get a disaster program in place to help these producers.”
And to keep food prices in check.
Egg Groups Have Competing Views on Egg Bill
The Senate Agriculture Committee will hold a hearing on the impact of the Egg Products Inspection Act Amendments of 2012 later this week. Two different egg groups are at odds over the bill – which would require farmers to use larger cages for egg-laying hens. Egg Farmers of America says the bill will impose unsustainable costs on farmers. United Egg Producers supports the bill – saying it would preempt competing state standards.
America Still Loves a Good Burger
In spite of all the negative pressures on beef demand – sluggish economy, high beef prices, unwarranted negative publicity – Americans still love a good burger.
Case in point: Forbes this week lists Five Guys Burgers and Fries as America’s fastest growing restaurant chain.