Photo by Michael P. King/UW-Madison CALS
Beef prices were a bright spot in Wisconsin agriculture this past year and consumers supported those prices across the nation. But is that going to continue? Brenda Boetel helps us answer the question. Brenda is an agricultural marketing specialist with the Division of Extension and she chairs the Department of Agricultural Economics at UW-River Falls.
Boetel expects strong prices to continue for beef in 2024. However, that means those prices will also be high at the grocery store.
“Because we have such a lower supply of beef right now, there’s just not as much beef available for the U.S. consumer, which means that we’ve had some record high beef prices,” she says. “We’re going to continue to see increases in beef prices at the retail level… that increase should not be to the extent that we saw previously, however, they’re still going to continue to go up.”
Boetel says a surprising trend in 2023 was that consumers continued to support high beef prices across the nation. But when do consumers push back on high beef prices, and opt for a cheaper protein? Brenda walks through the economic scenarios that would cause that pushback.
“The biggest concern we have for 2024 is if we start to see a recession or we start to see even further declines in consumer savings,” she says. “That basically means that they’re trying to find alternative ways to make savings, then that’s the bigger concern for beef because it’s the highest priced protein out there.”
In that scenario, she says consumers would look to save money by opting for alternative proteins.
Pork producers saw lower hog prices in the past year, and that’s likely to continue due to lower demand and steady supply. But there’s another factor in the market that is causing concern — California’s Proposition 12.
Boetel paints the picture for us of how individual state regulations can throw a wrench into the marketplace.
“Producers, in order to be able to have their pork sold in California, they have to meet the guidelines of the pork production under that initiative,” she explains. “Which means that a lot of producers will have to change barns, facilities… in order to meet those guidelines if they want their pork to be sold there.
She says California consumes the most amount of pork of all the states.
“That’s going to create a lot of upheaval because if we have pork that’s produced that’s not under those guidelines, it can’t be sold in California — Is it then going for the export market, is it then going to other retail stores to other states within the United States? That’s going to create a lot of variability and a lot of uncertainty yet.”
In the U.S., Wisconsin ranks in the top 10 for turkey production, and in the top 20 states for chicken and egg production. So when the Highly Pathogenic Avian Influenza came around in 2022, Wisconsin felt the pressure. Fast forward to today, broiler and egg production is thriving compared to the last few years, according to the numbers from USDA.
Boetel says the good news will continue for producers if they can stay protected from the avian flu.