Retail Prices Signal More Beef

Source: westerngrocer.com

The shift from food service to retail in Canada surpassed $20 billion in 2020. What does this change in consumer behaviour mean for beef markets now?

In 2020, food service sales were down $20.3 billion from 2019. Special service, catering to large gatherings, bore $3 billion of the loss. Retail outlets took over, increasing sales by $26.1 billion. Retail sales were up on average 9% throughout 2020, a steady trend that is reliable in the first quarter of 2021.

Beef demand at retail is supporting strong pricing, stable between $20.04/kg and $20.31/kg since August through January. Averaging $20.37/kg in 2020, the retail beef price was up 6% from the three-year average and up 2% from the recent high in 2016. In January 2021, the retail price of beef was $20.31/kg, up 4% from January 2020 and 5% from the five-year average. Rib cuts have been coveted in North America, with prime rib roasts at $37.66/kg this January, up 9% ($3.10/kg) from January 2020. January 2021 prices for ground beef and boneless blade roast were steady with January 2020. These products provide versatility for meals at home with both higher demand and North American supply stabilizing prices.

Beef supply is stable to ample with domestic production 13.6% higher year to date because of larger carcass weights. Winter weight gain lifted carcass weights up 22 pounds for fed cattle and up 3 pounds for lean cattle year to date. Slaughter is up 11% year to date at a steady pace.

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