2023 Beef retail prices reach new highs, domestic supplies projected lower

Average retail beef prices have finally turned lower after trending counter-seasonally higher through the summer. If seasonal trends play out for the remainder of 2023, retail beef prices will decline a significant 7 per cent in October, rebound 10 per cent in November, then decline 12 per cent in December. Retail prices (stewing cuts, striploin cuts, top sirloin cuts, rib cuts and ground beef) averaged $22.20/kg in September, 1.5 per cent lower than August’s all-time high of $22.54/kg. High-end beef rib and top sirloin prices were down 16 per cent and 2 per cent, respectively, from their all-time highs in August. However, those price declines were largely offset by increases in stewing beef (+14 per cent), striploin cuts (+6 per cent) and ground beef (+2 per cent).

On the competing meat front, September retail pork prices declined 2.1 per cent from August to $9.84/kg. Price increases of 10 per cent for bacon and 2 per cent for loin cuts weren’t enough to offset the 22 per cent and 5 per cent drop in shoulder and rib cuts. Poultry prices also fell in September, down 2.4 per cent from August. The most popular, chicken breast, saw prices increase 5 per cent. Whole chickens were down 12 per cent, drumsticks were down 11 per cent and thighs were down 1 per cent. Competing meat prices fell more than beef, resulting in larger price ratios; with beef-to-pork at 2.26:1
and beef-to-chicken at 2.22:1.

Canada’s beef cow inventory sits at 3.66 million head as of July 1, down 1.5 per cent from last year. The number of beef heifers retained for breeding was down 3.2 per cent to 600,900 head. Both metrics of future beef supplies point to a reduction in beef production until at least 2026. Once herd re-building begins, domestic beef production will be further reduced, as breeding heifers are retained on cow-calf operations, rather than moved into feedlots.

Total domestic beef production (including slaughter exports and offals) is projected to be down 5.3 per cent to 3.42 billion pounds in 2023. Fed production (slaughter exports) is expected to be down 6.5 per cent to 2.75 billion pounds. Non-fed production, up 1.7 per cent to 578,000 pounds, will support total production this year.

In 2024, total domestic beef production is projected to continue to decline around 3-5 per cent from 2023. Fed production is projected to be down approximately 4 per cent; non-fed production is projected to be down almost 5 per cent.

Reduced domestic production in 2023 has opened a window for larger import volumes this year and is
expected to continue in 2024. When domestic beef production increases, it will be easier to move consumers away from imported beef to Canadian beef than it will be to move consumers from pork or poultry to beef. Therefore, increasing import volumes during times of reduced domestic production should be seen as a positive for the Canadian beef industry as it supports per capita consumption.

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