According to a new analysis, in the United States, meat and poultry prices are expected to rise, but more expensive cuts like steak should level out.
Evercore ISI issued a protein inflation note this week estimating that most protein prices are expected to climb “significantly” because of the higher feed costs, with chicken breast reaching as high as 70 percent year-over-year in the first half of 2022.
The report predicted pork and ground beef might jump as high as 20 percent year-over-year during the same period.
However, inflation for pricier cuts like steak is likely to level off or perhaps reduce as consumers alter their shopping patterns to more affordable products due to their budgets getting squeezed.
Evercore’s analysis suggested that ribeye and chicken wings prices could reduce by roughly 15 percent in the first half of this year.
“Chicken and hamburger costs are predicted to continue rising, while steak prices will likely reduce,” said David Palmer. He is a senior managing director of Evercore and oversees the firm’s Restaurant and Food Producers division.
The survey highlighted the rising costs of grains used to feed animals, such as wheat, soybeans, and corn, as a significant factor contributing to protein prices. Wheat, for example, soared following Russia’s invasion of Ukraine.
“We also note that beef is the least sensitive to grain volatility (from the Russia/Ukraine war) as feed comprises up roughly ¼ of production cost against 50 percent + for pork and 70-80 percent for chicken,” Palmer told FOX Business.
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