The summer barbecue season is quickly approaching and with COVID-19 restrictions easing across most of the country, there could be strong demand for meat products like burgers, steaks, chicken breasts and pork chops as Canadians gather again with friends and family.
The prices for meat proteins have been climbing since the start of the year, and there’s no sign the upward pressure is going to lose its sizzle.
A combination of supply-chain disruptions, higher prices for the grain needed to feed livestock and increasing demand will impact not only consumers but some producers as well.
“We’re expecting consumers to pay way more at the meat counter than before,” said Sylvain Charlebois, the director of the Agri-Food and Analytics Lab at Dalhousie University in Halifax.
Charlebois said Canadians have already seen prices for chicken and pork go up by five percent on average since the beginning of the year, and he expects beef prices to rise even higher this summer.
“The food inflation rate could actually exceed seven or eight percent, in beef in particular.”
Depending on who you talk to, the increases in wholesale prices for chicken, beef, pork and lamb have already climbed much higher than that.
“We’ve seen the biggest increases in rib eye, tenderloin, New York steak and sirloin, brisket as well,” said Alexander Ross, the owner of Harry’s Natural Meats in south Calgary, of the price fluctuations of the past year.
“Those are the main cuts that have gone up in price drastically, anywhere from 15 to 30 percent.”
Consumers will likely pay more regardless of whether they’re shopping at the grocery store or ordering from a restaurant.
As prices climb, you might expect profits to do so, but that’s not necessarily the case for all producers.
Cattle producers have been affected by pandemic-related disruptions to the supply chain, particularly on account of staffing shortages and closures at processing plants.
A slowdown in processing has created a bottleneck at the farm and feedlot while domestic and international demand for Canadian beef has been strong.
As a result, cattle producers and feedlot operators were earning less while the tighter supply and steady demand drove up prices for processors and retailers, according to a market analyst with Canfax, a division of the Canadian Cattlemen’s Association.
Perillat of Canfax said grain prices have gone up partly because of weather concerns and drought in parts of the U.S. as well as strong demand from China, which has increased its imports of barley and corn from North America.
While feed prices are rising, the biggest wild card has been the impact of COVID-19, which disrupted nearly 20 processing facilities across the country since the start of the pandemic.
On the retail side, he said, grocery stores have also faced added costs, including the expenses associated with stepped-up cleaning measures and other COVID-19 precautions, which have likely been passed onto customers.
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