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Industry At A Glance: Quarterly Beef Demand Index On The RiseIndustry At A Glance: Quarterly Beef Demand Index On The Rise

The second quarter of 2014 revealed the highest quarterly beef demand index measurement since the end of 2007.

Nevil Speer

November 6, 2014

2 Min Read
Industry At A Glance: Quarterly Beef Demand Index On The Rise

Beef’s continued price run has garnered a lot of media attention during the past year. That attention is well deserved: retail beef prices surpassed $5.90/lb. in September – more than 20% higher vs. last year at this time. As such, there’s ongoing concern about price resistance and general demand destruction at ever-higher price levels.

Aggregate demand for any product or service is the function of five key factors: population, income, tastes/preferences, expectations, and the price of other goods. The last item, price of other goods, provides reference to price competitiveness within the broader market. That invokes the concept of the substitution effect, whereby higher prices encourage consumers to switch to other goods – i.e., consumers trade down to pork and poultry.

With all that in mind, it’s helpful to step back and look at the longer-term picture with respect to beef demand and the U.S. consumer. Despite higher beef prices during the last several years, beef demand has also continued to advance. In fact, the second quarter of 2014 revealed the highest quarterly index measurement since the end of 2007.


Following that time in ’07, beef demand began a sharp plunge in 2008 with the onset of the financial crisis, and bottoming out in the third quarter of 2009. Since that time, though, there’s been a steady increase in demand (function of both quantity and price). That rise in demand has helped underpin better spending and higher cattle prices.

What’s your perception of beef demand and the general state of beef spending among U.S. consumers? What factors do you perceive as driving better beef demand during the past several years? Where do you see demand headed in the years ahead?

Leave your thoughts below.    


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About the Author(s)

Nevil Speer

Nevil Speer serves as an industry consultant and is based in Bowling Green, KY.

Nevil Speer has extensive experience and involvement with the livestock and food industry including various service and consultation projects spanning such issues as market competition, business and economic implications of agroterrorism, animal identification, assessment of price risk and market volatility on the producer segment, and usage of antibiotics in animal agriculture.
Dr. Speer writes about many aspects regarding agriculture and the food industry with regular contribution to BEEF and Feedstuffs.  He’s also written several influential industry white papers dealing with issues such as changing business dynamics in the beef complex, producer decision-making, and country-of-origin labeling.
He serves as a member of the Board of Directors for the National Institute for Animal Agriculture.
Dr. Speer holds both a PhD in Animal Science and a Master’s degree in Business Administration.

Contact him at [email protected].

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