The price of American beef, which is called ‘cost-effective beef’ and favored by Korean consumers, is showing a clear upward trend. There are also concerns that dining out costs and shopping cart burdens will increase further ahead of the year-end peak season.
According to the livestock distribution information of the Livestock Product Quality Evaluation Institute on the 21st, the consumer price of frozen ribs from the United States last month was 4,435 won per 100g. This figure is 3% higher than the previous year (4,304 won) and 19.3% higher than the average year (3,718 won). In large supermarkets, prices have risen by about 20% in a year.
The biggest reason for the price increase is the sharp decline in cattle breeding in the United States. As of January this year, the number of cattle raised in the United States was 87.2 million, the lowest in 73 years since 1951. This is due to the reduction of pasture land due to severe drought and severe cold over the past few years, and the sharp increase in feed prices such as corn, which has resulted in farms reducing their breeding scale.
The exchange rate is also a factor that pushes prices up. The value of the won, which was around 1,390 won per dollar in early September, fell to the 1,470 won range this month. If the dollar continues to strengthen, the cost of importing American beef will also rise. According to the Bank of Korea, last month’s import price index rose 1.9% from the previous month to 138.17, rising for four consecutive months. The industry believes that the burden at the end of the year will increase as these import price increases are reflected in consumer prices with a lag.
The price of domestic Korean beef is also rising significantly. According to data from the National Data Center of the National Statistical Office, the consumer price index for domestic beef in October was 109.84 (2020=100), up 4.6% compared to the same month last year. According to statistics from the Livestock Product Quality Evaluation Institute, the average price of grade 1 Korean beef tenderloin (100g) last month was 13,113 won, 3.9% higher than a year ago. Sales prices of Korean beef at large supermarkets have increased by more than 15% on average, although there are differences depending on the cut.
Domestic prices are also mainly driven by supply reduction. As oversupply continued for a while after the COVID-19 pandemic, farms reduced the amount of breeding and slaughter, and this trend has recently led to a rise in prices. An official at a large supermarket said, “The number of animals raised has decreased by about 16% compared to last year, and the price for sirloin has risen by nearly 20%.” The Korea Rural Economic Institute also predicted that the number of Korean beef slaughtered in the fourth quarter of this year would be 205,000, a 17.3% decrease compared to the same period last year.
An official from the livestock industry said, “The price of domestic beef has risen sharply since last July and is currently at a level that is more than 10% higher than the previous year.” He added, “The intention to raise cows is increasing, but it will take more time for prices to stabilize.”
https://n.news.naver.com/article/011/0004558978