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Inflation affecting livestock products from the ranch to grocery store aisles

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Posted at 8:27 AM, Feb 02, 2022
and last updated 2022-02-02 10:28:31-05

It’s hard to miss inflated prices and the sticker shock at the grocery store, particularly the price of beef.

Professor Eric Belasco, who focuses on agriculture economics at Montana State University, has been researching the livestock industry for over a decade and calls this an "unprecedented" time of inflation.

“Trying to pinpoint where that inflation is coming from in the beef sector,” Belasco said. “Most of the inflation is for at-home products, not restaurant products.”

Essentially, beef products go from the ranch to processing plants, to the store or restaurant. In between the plant and the final destination is where most of the cost lies, according to Belasco.

Fuel for trucks driving through passes, a shortage in labor, logistics, and the cost of trucking all are factors that hike up the price on the shelves.

During the pandemic, many people elected to cook at home. More cooking at home meant stores needed to have a larger stock of beef. Ranchers in Montana also are having to pay premium prices, but not for the animals—for the feed.

“Worst drought I’ve experienced since being here, and really you look back historically so that has an impact—can you find enough feed, forage to keep those cows in Montana,” Belasco said.

One proposed way to keep Montana cows in Montana is by building more small meat processing plants in the state. When a large plant needs to quarantine or shut down, that puts a bottleneck in the producers. Small plants would be able to consistently move product to the shelves, according to Belasco.