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| What I saw last night were people that aren't much affected by beef prices, including steaks, and lots of them. Rural America isn't exactly a booming economy. Yes beef prices can change buying patterns. But there is a substantial population that has shown their willingness to shrug off the highest prices in history. Mixed drinks were $13 and people were having a couple. What's $50 for a decent steak?
There is an incredible amount of affluence out there. And beef (thanks to a number of factors) is more popular than it has been for a while. Whether it be the carnivore diet, or JFK Junior changing diet recommendations. Cattle numbers are short and not showing much expansion, again for a number of reasons. Do I think they can keep going up forever? No, but they are A LOT higher than I could ever have imagined. What will make prices come down is not domestic production increase, not for a time any way. People keep getting their panties in a knot because of Trump saying one thing or another. The market responds for a few days but comes back with record prices. A combination of short supplies that took years to create and will take years to correct (if ever) and crazy demand. Denver and Colorado have become as liberal a place as there is. But here is a restaurant that serves meat and a lot of it, full of people. It ought to be struggling by many peoples thinking. People struggling to put $5 gas in their nearly new cars. But they are building million dollar homes as quickly as they can build them. My daughters boy friend sells real estate. Knows of $120 million for 80 acres to build a data center.
What I have come to understand is that I grew up and still live in a different world. Where a ten year old truck is your "new" truck. Grains are cheap by design not a reflection of what it takes to grow them. But cattle have become a different sort of commodity. Big AG killed the goose that lays the golden egg, for the time being anyway. Beef isn't over valued, it was under valued for decades. If you think cattle numbers are short now, wait for a substantial correction in prices (for what ever reason). | |
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If you think beef is expensive
