Extreme weather is about to beef up meat prices. Meat supplies apparently took a hit from the ice-cold weather, not to mention drought and food supply. In fact, the cattle herd is the smallest in 60 years, and that could lead to higher costs.
"We're seeing about 15 to 20 percent wholesale increases this week over two weeks ago. So we haven't done any price increases on beef, and won't do it until we see more cost increases on a long-term basis," said Scott Karns, CEO of Karns Quality Food.
But soon enough that will trickle down to you, the consumer, and you'll be shelling out more cash for your meat. That is because there are less animals available.
"It started off first with the droughts three years ago in Texas. Then we had droughts in the Midwest. Then we had the historically high corn prices. So when corn gets high, the farmers stop raising cattle and breeding cattle. And whenever you have droughts, farmers process their herds because they can't feed them," Karns said.
The recent cold snap put the final freeze on meat processing.
"Imagine being in a truck at 60 miles an hour, and you're going down the road, and it's ten degrees below zero. They just can't ship the products, so the plants close down and they don't process any product. And as consumers, we keep buying beef and chicken and pork, and eventually the prices go up," said Karns. "The beef market will come back. It may not get back to where it was, but it will come back."
Karns does not expect prices to go back down until 2015, but said chicken prices should remain stable because most chickens are processed below the Mason Dixon line.