WASHINGTON — Smokeys BBQ in Fort Worth, Texas, needed to do something.
The price it paid for brisket jumped a net 54 percent in just six months. It had cut its staff from 13 to seven. The only thing left was to raise prices for its customers, the first time in three years. A pound of Smokey’s brisket went from about $13 to $16. Pork spare ribs jumped from $22 to $27.
“We had to raise our prices. We had to adjust,” said owner Rosco Carrasco, who’s 47, noting his own costs. “If they continue to go up at this pace, we’ll have to do it again.”
Soaring meat prices are hitting producers, suppliers and consumers across the country. The price of beef and veal shot up more than 10 percent from June 2013 to June 2014, according to the most recent Consumer Price Index. Pork prices rose by 12 percent.
The largest price increases in three years are driven by one main thing: supply. Drought has thinned herds of cattle. Disease has struck pork.
While demand is high and technology allows more producers to get more meat than ever out of cattle, the domestic beef supply is at a 63-year low, according to beef industry experts and U.S. Department of Agriculture data.
Meanwhile, pork farmers in over 40 states have reported cases of a pig virus called porcine epidemic diarrhea (PEDv), an illness most fatal to newborn pigs. The virus has hit many pork farmers in Midwest states and North Carolina harder than others. The nation’s pig population is at its lowest since 2006.
Although swine populations probably will rebound soon, experts said, the beef supply could be a problem for several years.
“We’re seeing unprecedented price levels,” said Derrell Peel, an agricultural economics professor at Oklahoma State University. He added: “Ultimately, everyone will pay part of that impact.”
The drought that started in 2011 in many major cattle-producing states, especially Texas, cut down the grazing space for cattle. That forced farmers to sell animals to feed lots to be slaughtered. The economic recession and price shocks in cattle feed also contributed to the beef supply problem, Peel said.
The weather has improved in the past 90 days, making some cattle ranchers “cautiously optimistic” that the drought might end soon and farmers could start to rebuild their cattle populations, said Mike Miller, a senior vice president at the 35,000-member National Cattlemen’s Beef Association.
By and large, cattle ranchers “would probably say that they’re holding steady if not increasing.” Miller said of their herds. “It’ll take some time.”
Indeed, a cow can give birth to only one calf a year, and the calf can take 18 months to reach its required weight before it’s sent to market.
With the lowest cattle population in over half a century, cattle farmers are reluctant to sell much of their herds as they rebuild them, experts said.
“Even if we start rebuilding,” said Peel, the Oklahoma State professor, “that’s going to be a four- to six-year process.”
Beef prices will continue rising until 2016 before consumers can expect any relief at the checkout counter, Peel said.
The lack of beef and pork hurts the job outlook in the meat industry too.