US meat industry braces for impact of new measures, surplus

(Source: NBC News)
(Source: NBC News)
Updated: Aug. 8, 2018 at 10:51 AM CDT
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(WSFA/NBC) - The United States meat industry is bracing for the impact of new measures and sorting out an American meat surplus already present in the country.

Some butchers say the prices they pay for beef and pork haven't changed much this year despite the increase in the supply of meat.

Thadeus Gonzalez said, "All of our farms are all local to everywhere in the proximity of about 200 miles, so nothing is really going to affect us that much."

But some analysts say the rising amount of US beef and pork sitting in cold storage could mean trouble ahead for farmers and meat companies.

Meat that doesn't go to retailers, restaurants or export markets ends up in freezers.

The latest USDA monthly numbers show total pounds of stored beef were up year over year.

Frozen pork is up slightly from last year. Analysts say the numbers are not record-setting but big and foreboding.

Rabobank Executive Director Cristine McCracken said, "We're definitely expecting inventories to continue to increase. We're expecting a huge increase in production this fall, record high."

The amount of meat in cold storage has been building in part because of low feed prices, which is a major cost for producers.

Demand has also been on the rise especially from export markets. Experts say meat processors have increased production to fulfill the growing needs.

Eventually ballooning supply out-paced demand and now with trade tariffs in place on some beef and pork exports to China and Mexico. Some analysts say it's just a matter of time before the rising supply of protein will eat into profits of meat companies.

That's not all bad for the American consumer, however.

Some experts predict that the increased stockpiles may mean lower prices on meat around the holiday season this year.

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