Where’s the beef?

Where’s the beef?

The person who oversees our family farm was complaining about the price of beef. He said “Would you believe what ground beef costs?” I told him that I actually had not looked in the past 50 years since I only eat the venison from deer that I had harvested myself. But I am sympathetic. He was hardworking all of his life and is now retired with his wife 100 percent disabled due to a heart condition. He said that they couldn’t afford today’s prices and was wondering what had happened. I told him that the local grocery store usually ran a special BOGO on ground turkey at least once a month so he should check their weekly ads. Ground turkey? He looked at me like I was speaking in tongues.

The high beef prices are due to a number of factors. One is the herd is smaller than it has been in decades. That along with Trump’s 50 percent tariffs on Brazil which further reduced the supply of beef has led to these high prices. Now isn’t this what the president wanted? By restricting imports of beef due to the tariffs, beef prices have soared and US cattle ranchers are making record profits of over $700 per animal. So the cattle growers should be ecstatic. They may be, but per my conversation with the overseer, the American public is ticked off. Not to worry. Our intrepid president says that the cattle growers should voluntarily lower their prices and he will import beef from Argentina.

He said “The Cattle Ranchers, who I love, don’t understand that the only reason they are doing so well, for the first time in decades, is because I put Tariffs on cattle coming into the United States, including a 50% Tariff on Brazil. posted on if it weren’t for me, they would be doing just as they’ve done for the past 20 years —Terrible!” “It would be nice if they would understand that, but they also have to get their prices down, because the consumer is a very big factor in my thinking, also!” 

OK so let’s get this straight. The president is taking credit for raising the price of beef to the consumers resulting in record cattle prices while asking the cattle ranchers to voluntarily lower prices. He then said that maybe he will import more beef from his buddies in Argentina. “One of the things we’re thinking about doing is beef from Argentina.” Trump told reporters “We would buy some beef from Argentina. If we do that, that will bring our beef prices down.”

Needless to say that elicited a howl from the cattle folk and their representatives in Washington who sent the president a letter protesting such a move. Trump’s Department of Agriculture said that it would move to increase the size of the herd through expansion of grazing on federal lands. Maybe that will help eventually increase supply but cows do not pop out of the heifer fully grown like Athena from the head of Zeus.

One agriculture economist said that the president needs to take a course in supply and demand (where have you heard that before?) saying “If you want to increase the supply of beef long-term, you don’t do it by lowering prices.” Elementary. I will repeat: you don’t induce producers to increase supply by lowering prices.

So now we have a conundrum. Beef prices are at a record high, cattle growers are making record profits but the consumers are angry. The president wants it both ways, he is patting himself on the back for raising tariffs to restrict the supply of beef but he wants the cattle ranchers to lower their prices or else he will import beef from Argentina. If he heaven’s forbid, rescinds the tariffs, the ranchers will be ticked off as beef prices and profits fall. The president got himself into this mess. It will be interesting to see how he gets out of it.