Washington — Retail beef prices are soaring reaching a record $3.21 a pound for USDA-choice cuts in January because of a harsh Plains winter that has been tough on cattle.
Prices are likely to dip by the summer, but bounce back up because of tight cattle supplies. Producers only now are starting to rebuild herds that they thinned because of drought and low prices in the late 1990s.
The winter has been so cold and damp that cattle are taking several months longer than usual to fatten up. In bad weather, cattle in feedlots don't eat as much and use up energy staying warm.
"We have basically had one of the harshest winters that we have seen in a very long time," said Chuck Levitt, a meat analyst with Chicago-based Alaron Trading Corp. "The last time we had a winter this severe across the major cattle feeding areas was in 1993."
The previous record for retail prices was in September, at $3.13 a pound. In the late 1990s, they were averaging about $2.80.
Live cattle are selling for 82 cents a pound, up from 78 cents last month and about 68 cents in February 2000.
"We've definitely seen the beef prices go up big time," said Rickey Figueroa, executive chef of Atlanta's Chops Steakhouse.
The price the upscale restaurant is paying for beef tenderloin has gone from $15 to $20 a pound in recent weeks. So far, the restaurant isn't changing its menu prices.
Americans have rediscovered a taste for beef at the same time that U.S. meat exports are up and many producers have been sending all of their calves to slaughter, rather than holding females back for breeding.
Experts say it's too early to asses the effect on U.S. prices and supplies from outbreaks of mad-cow and foot-and-mouth diseases in Europe.
U.S. cattle supplies are down 1 percent this year and 6 percent from a peak in 1996.
Beef consumption, meanwhile, reached 99.5 pounds per person last year, up from 98.7 per person the year before and 95.6 pounds in 1997. U.S. beef sales to Japan and other export markets rose 11 percent in 1999 and another 4 percent last year.
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