Retail Meat Prices & Price Spreads
Related Reports
- Livestock, Dairy, & Poultry Outlook: February 2013
- Livestock, Dairy, & Poultry Outlook: January 2013
- Livestock, Dairy, and Poultry Outlook: December 2012
- Livestock, Dairy, and Poultry Outlook: November 2012
- Livestock, Dairy, and Poultry Outlook: October 2012
ERS collects data on livestock and meat prices from other USDA
agencies, the Bureau
of Labor Statistics (BLS), and commercial information sources
to calculate retail, wholesale, and farm values for beef and
pork.
Retail Prices
In 2002, ERS began providing monthly average retail price data
for selected cuts and aggregate categories of beef, pork, poultry,
lamb, and veal, based on electronic supermarket scanner data. The
database contains meat-cut categories that correspond to BLS
meat-cut categories and provide an alternative way to estimate
retail prices. (Congress mandated this alternative process in the
Livestock Mandatory Reporting Act of 1999.) Along with the BLS
categories, the ERS database includes price data on additional
cuts, information on volume sold, and the discount effects of
featuring. (An April 2003 Amber Waves data feature contains a
few examples on how meat prices respond to featuring and season.)
For more information and the data, see Retail Scanner Prices for Meat, which is housed
at Colorado State University's Livestock Market Information Center (LMIC) as
of October 2004. The pilot program between ERS and LMIC has monthly
data running from January 2001 until April 2008.
BLS also publishes average retail prices for selected meat cuts.
Scanner data standard table 1 presents average
retail prices for selected meat cuts from both BLS and the
supermarket scanner data. BLS collects prices from a larger number
and greater variety of outlets, but does not collect data on sales
volume. Comparing Two
Sources of Retail Meat Price Data (November 2009) compares BLS
and scanner data, describing the differences between these two data
sets and evaluating their relative strengths and weaknesses.
Price Spreads
ERS develops
price spreads for beef, pork, broilers, turkey, and eggs as a
measure that describes the allocation of the consumer dollar among
the various stages of marketing in the livestock/meat industry. The
measuring points are the farm and wholesale and retail levels in
the marketing chain. The farm and wholesale prices are from USDA's
Market News, and retail prices are from BLS. Prices from these
sources are standardized to reflect 1 pound of meat at the retail
level. Meat
Price Spreads are reported monthly for total (farm to retail),
farm to wholesale, and wholesale to retail.
Beef values and
price spreads
measure the value of a Choice steer to the farmer, the packer, and
the grocer. Pork
values and price spreads
measure the value of a slaughter hog to the farmer, the packer, and
the grocer. Both tables show values for the current month, the
previous 12 months, the last 12 quarters, and the last 6 years. A
historical
series
contains many more years of data on price spreads for beef, pork,
chicken, turkey, and eggs.
Price spreads can be volatile and may reflect lags in price
response at the farm and retail levels due to price changes. Lag
lengths may vary depending on whether prices are going up or down
and depending on expectations about future price changes.
Price spreads based on a current-dollar (nominal) values show
long-term increases. Marketing expenses reflect costs of labor,
utilities, facilities, and non-livestock materials such as
packaging. The costs of these items tend to follow inflation. After
accounting for inflation by deflating beef and pork price spreads
by the Consumer Price Index, deflated price spreads do
not show much of a long-term trend. Some studies suggest that
economies of size gained in meat packing have been passed back to
the farm, thereby raising livestock prices above what they would
have been without consolidation.
More information on price spreads can be found in U.S. Beef
Industry: Cattle Cycles, Price Spreads, and Packer
Concentration (April 1999); in the Agricultural Outlook
article, Controversies in Livestock Pricing
(December 2002); and in Beef and Pork Values and Price Spreads
Explained (May 2004).