U.S. beef lovers feeling the effects of cattle diseases striking Europe

Saturday, April 14, 2001

Stephanie Brenowitz Dispatch Business Reporter

Just in time for the summer grilling season, the foot-and-mouth scare in Europe and a cyclical downturn in cattle production are driving up beef prices.

"It's terrible,'' Diane Kaiser said as she picked out a whole tenderloin at the meat counter of Carfagna's Specialty Foods, 1405 E. Dublin-Granville Rd. "The last time I was here, it was $5.99 a pound. Now it's $7.99. My husband is a regular, old meat-and-potatoes kind of man, but we can't afford to eat like this very often.

"This summer, we will be grilling a lot of chicken.''

Consumers across the country are getting hit with the highest beef prices on record, the U.S. Department of Agriculture says. In the Columbus area, butchers report that filet mignon and New York strips are up at least a $1 a pound over last summer; ground beef is up 50 cents to 75 cents a pound.

"We're feeling the pinch, which means consumers are going to feel the pinch at home,'' said Dino Carfagna, co-owner of Carfagna's. "Everybody has to eat, sure, but they don't have to eat beef.''

Meat-loving Americans can blame part of it on Europe. Because of mad-cow and foot-and-mouth disease there, cattle have been quarantined or destroyed, cutting the world's supply of beef. Although ranchers in the United States do not ship to Europe because of trade regulations, some American producers are shipping beef to European customers in the Middle East and Asia, which means less beef for us.

Cattle ranchers say the U.S. beef supply already was low for several reasons. Ranchers who liquidated excess animals in the early 1990s, when beef wasn't as profitable, haven't been able to rebuild their herds. A harsh winter kept young cattle from putting on enough weight to be slaughtered.

Ranchers say they also are bearing the cost of higher safety standards for consumers. For example, cattle-feeders are exploring ways to document the movement of every animal so that if one develops a disease, health officials can find the source of the contamination.

Such precautions are expensive.

"The American consumer is so fickle,'' said Steve Buckalew of United Producers, a cattle-marketing cooperative based in Columbus. "Their grocery bills aren't as high as they are in other countries around the world, but they still complain. If they want to be sure their meat is safe, there's a cost.''

All this is occurring just as demand for beef is increasing for the first time in two decades, says the Washington-based National Cattlemen's Beef Association. Consumers spent a record $52 billion in 2000; they ate more beef than either pork or chicken, said Cattle-Fax, a private market-research firm.

Steve Yoder said his customers at the Top Steak House on E. Main Street didn't complain when he raised the price of a New York strip from $22.95 to $25.95.

"I've never had a comment, because people are willing to pay for quality,'' he said.

To save money, Yoder hired a butcher rather than pay to have the meat cut into steaks before delivery. But he's still considering another price increase next month.

Wendy's International says it's paying more for hamburger but isn't passing the cost on to customers. Because the beef industry is cyclical and falls into a supply slump about every 10 years, the Dublin-based fast-food chain had factored in the rising cost of beef, said company spokesman Bob Bertini.

All hope is not lost for a summer filled with grilled burgers and steaks. Joseph Glauber, an economist with the Agriculture Department, said production will catch up with demand by late summer.

In the meantime, Ohio's cattle producers aren't complaining. While ranchers elsewhere are receiving $77 per hundred pounds of beef, which is high, some producers in this state are getting as much as $85 for the choicest cattle, Buckalew said.

"For the first time in a couple of years, cattle is actually profitable,'' he said.

"Corn and grain prices are low; cattle prices are strong. A few years ago, ranchers were getting rid of their herds because it didn't pay to raise them. Now, it sure does.''

http://www.dispatch.com/news/news01/apr01/660366.html

-- Martin Thompson (mthom1927@aol.com), April 14, 2001