The 2012 Food Price Index and Forecast reported that American beef and veal prices increased by 10.2%, pork prices by 8.5% and poultry by 2.9%.
Overall, meat prices experienced the second-largest increase of all food-at-home categories (8.8%) behind fats and oils, which rose by 9.3% between 2010 and 2011.
“Beef and pork price increases in 2011 were driven largely by record-low inventories for cattle and hogs, combined with strong international demand for beef and pork products,” said Richard Volpe, economist with the Economic Research Service.
“This environment persists in 2012 and meat prices are expected to remain high, particularly for beef and less so for pork. Poultry prices are rising now, as consumers shift towards chicken products as a means to avoid sustained high prices for other meat products.
“The volatility of grain prices is certainly a factor, but right now we are dealing with structural, long-term inflation for meat.”
ERS forecasts that meat prices in general will increase by 3.5-4.5% in 2012, with beef and veal prices rising by 4-5%, pork by 3-4% and poultry by 3-4%.
Food prices surged in the final quarter of 2011 with the food-at-home Consumer Price Index (CPI) increasing by more than expected to 4.8% in 2011. According to ERS, price increases will fall in 2012 to between 2.5-3.5% – assuming normal weather conditions and no shocks to the global commodities market – which is within the historical average of 2.8% (1999-2011) for food-price inflation.