Inflationary pressures continue to impact the global beef market
Further increases in beef prices run the risk of consumers substituting to other proteins or reducing their overall consumption, analysts warn.
As global beef supplies are to remain tight this year, prices are expected to rise. However, is not just the lack of beef in the international market that is going to keep prices elevated, Rabobank analysts warned. Over the past two years, retail beef price movements have been phenomenal, driven largely by strong consumer demand and some supply shocks.
In many cases, this increase in prices was caused by demand-pull. With supply unable to keep up, the increase in demand has created an imbalance in the market and, as a result, beef prices have lifted, Rabobank's quarterly report says.
Rising inflationary pressures continue to impact the beef supply chain. Several the cost increases will be permanent and will need to be accommodated within the supply chain. While the demand-led increase in beef prices may have alleviated some of the pressures of the cyclical cost increases, finding a way to maintain beef demand and cover further cost increases may prove a more challenging task.
Further increases in beef prices run the risk of consumers substituting to other proteins or reducing their overall consumption.
Source: meatinfo