Pandemic causes meat prices to soar

Customers entering grocery stores last week were aghast at the escalation in beef prices, leaving some to opt out of buying it at all.

A 2.79-pound package of 73% lean ground beef was selling at King Cash Saver, 2020 Main St., for $6.29 a pound, totaling $17.55, the price before the store’s 10% mark-up for its cost.

Some people have suggested bypassing stores and are encouraging people to buy directly from farmers and ranchers, but Cory Steeves at Timber Creek Meats in Parsons said that may not be a viable option right now.

For the last 11 weeks, Steeves said Timber Creek has been insanely busy, selling about four times the amount of meat it usually sells. The last two weeks it is not surprising considering people can still buy hamburger at Timber Creek for $4.99 a pound.

“I think we’re probably a little bit different than some businesses. It seems to me there are just tremendous amounts of fear and panic. It seems like (if) there is any kind of news, of any kind, it creates more fear and panic and people buy more food.

“And I think you just have more people at home cooking, where I think something like 40% of all of our food is ate out at restaurants typically,” he said. “I think people are just cooking at home a lot more, which has been good for our demand for sure. We’ve actually hired four other people that are working for us, but they are probably temporary.”

Steeves said Timber Creek has an advantage over grocery stores because it has its own meat-processing business in town, allowing it to buy local cattle, process the meat and sell it, maintaining prices a lot better than can grocers, who rely on meat-processing plants.

“But the big thing is the demand has increased so much we’re just not set up obviously to provide all of Parsons with meat all at once. We just don’t have the capacity or the ability to do that. It’s made it a challenge kind of,” Steeves said. “So right now my brother, Eric, and his wife, Amanda, they kind of run the custom processing side of it and I run the store, and we help each other back and forth. Right now, as far as being booked (on processing) we’re booked until December. It’s the same concept. It’s been the same since the beginning, but here in the last two weeks with all the people wanting beef, it’s difficult.”

Politicians talking to the media about meat shortages are doing more harm than good because it is creating panic and people are buying more meat, when there is really not a meat shortage. Rather, meat is not being processed as fast as it is normally. Instead of creating panic, Steeves suggests, politicians should be stating the system is under strain because of plant closings and share a plan to fix the situation.

Because there is panic, and people are buying more, Steeves said he has a lot people wanting to get a quarter of a beef or a half of a beef, or a whole beef or a hog, who’ve probably never done it that way. While people are getting online and encouraging people to buy cows directly from local ranchers, Steeves said small meat-processing facilities are not set up to handle that.

“It’s good, but now, all of the sudden, you have 100,000 people in the state of Kansas who want a half a beef. The infrastructure is not there to do that. We’ve kind of over the last three or four decades consolidated the meat industry to where we have these huge meat processors that are controlling everything. Now that that system is kind of wobbling we’re paying the consequences of that. We can’t rewind that in 10 weeks. The infrastructure is not there,” Steeves said. “You take a big plant like out at Dodge City at National and they process about 500 beef an hour. So you take a little meat plant like here, and they maybe do 10 beef a week. So the system has gotten to where a big plant in one hour can do what it would take ours all year long to do.

“Consequently, the vast majority of time, the big plants are on such a tight margin that a small processor can’t compete. Now these big plants are running at 60% capacity and they have to get more out of the product because they are not running at capacity, because they are not efficient. And then it is all part of supply and demand, and that people continue to buy it.”

Timber Creek is so busy, it can barely keep up with general purchases. It is not equipped to put together meat bundles normally offered to regular customers each month. Steeves supposes the busy days will not last as big meat-processing plants begin to get back up to speed.

“It is just a consequence of gigantic meat business. I’d like to say I’d like to see it reversed, but I know once everything gets back to normality, everyone is just going to go buy meat where it is the cheapest. That’s just the way that it is.

“It will be interesting to see how it plays out over the next couple of weeks to a month. I don’t see the prices falling very quickly, at least in the next couple of weeks, but I think it eventually will because I just don’t think people can afford it.”

Other areas impacted

Beef and pork are not the only forms of agriculture impacted by COVID-19. Every area of agriculture is impacted to some degree. But shutting down sectors of society may have saved agriculture from being impacted in some areas as badly as it could have been.

“If we had not done what we have done, shut down societies, it would have been a problem,” said Perry Sorrell, general manager of Bartlett Co-op Association. “If I’m a farmer and I have one week to plant corn and that’s the week I have coronavirus and I couldn’t, then I just lost my crop for the year. I had some producers take that very seriously. All the things they had to contact us for. If they had to put on anhydrous and they came in our store to pick up a tank, it changed the way we would do that. Instead of us going out and helping and hooking them up, we tried to get them to stay in their vehicles and limit our contact.”

Sorrell said that caused some difficulties. The co-op also had trouble getting supplies.

“Warehouses only hold so many tons of fertilizer. We only have so many bags of seeds and those things. We had trouble getting some supplies here because of shutdowns. … We were hit in ways we’re not traditionally used to. If I need a bag of seed we could get it somewhere, and that is not the case now. Or getting the people to deliver it. The trucking industry wasn’t affected for long but it was.”

Challenges on the livestock side related to the health of animals.

“Some of our folks take multiple vitamins and in our livestock we supplement vitamins and minerals. Come to find out vitamin A, D and E, which is prime supplement we put in our feeds, it is nearly all made in that Wuhan, China, area. So when they shut down, we were fearful we were going to run out and here we are in Bartlett, Kansas, a couple of minutes away from there,” Sorrell said. “So we had to look to find other sources. Two or three of our suppliers said, ‘We are done. We don’t have any.’ Even when they did get where they were going again, those products are being quarantined before they can enter the market, which I am so thankful for. 

“Even on the crop side, some of the micronutrients are made in that China area. They are not available. Back in the day, when I was young, we didn’t know we needed those things, so that doesn’t feel so bad as not having toilet paper,” Sorrell said.

Because of certain supplies not being readily available, and fewer people wanting to get out, sales have fallen, though Sorrell said he is not sure of the financial impact yet.

“I don’t mean as a complaint. I’m so grateful for opportunity. We made coming in our doors hard and some people would do everything to blow through those restrictions, not necessarily caring about their neighbors. So we had those challenges. We want to keep our people safe and at the same time protect our customers, too. That caused extra expenses, but compared to places that had outbreaks, it was well worth it,” Sorrell said. “I’m so very proud of our county and our communities for the efforts they took. I believe we saw the effects of the efforts in that we did not see as bad of an outbreak, or worse outbreak, but that is just my opinion.”

Business is picking back up now, he said.

“We are still having some challenges, but it’s getting better. We’re just getting over the coronavirus challenge and we’re being hit over the head with the water challenge. With the rains it’s hard to deliver feed and hard to deliver propane. Even our little store slows down on these days. But it is picking back up. We are seeing customers coming through the doors.”

Perhaps one of the hardest things for the co-op is knowing that a good portion of its business in the spring is youths involved in the county fair and seeing that portion of their business fall off.

“I’ve got a couple of folks that are outside salesmen for us and they spent a lot of their own time with families, making suggestions and those kinds of things. Those guys are dead in the water. First they can’t have contact and second families just aren’t sure what they are going to do,” Sorrell said. “My heart goes out to those folks. There is so much that goes into that. Our county I know is trying every way they can to make it work, but our kids are faced with decisions. … There are hard decisions being made. It is a brand new time. … This also helps them prepare for real life in that situation, too.”

Commodities markets are all being impacted by COVID-19, said James Coover, Wildcat Extension District crop and soils agent. Corn is probably the most affected. 

“The market has dropped off considerably because of the ethanol plants closing down and some of the other market factors as well. Some of those plants have talked about coming back on in a few months. Some have talked about maybe never coming back on, so there is a lot of uncertainty going on right now as far as those grain markets.”

As for as wheat, sorghum, soybeans, all of those markets have dropped off a little bit, though by a smaller percentage. 

Still, COVID-19 has impacted nearly every aspect of agricultural. 

“There’s really no place that has not been affected,” Coover said, explaining farmers and ranchers are hoping for some assistance through the Economic Injury Disaster Loan that was originally closed off to agricultural producers, but they are waiting on Congress about being included.

“That still hasn’t been decided. There is a lot of uncertainty and questions right now in the agricultural world. What’s going on? When’s all this volatility going to stop, and where are we going to end up at the end of all this? The USDA projections are coming out. They are usually a lot more pessimistic, I guess you’d say, but it’s hard to know what is going to happen,” Coover said. “Even the economists are stating this is unprecedented. We are grasping at straws. We usually have a much firmer basis upon what is going to happen.”

This article originally appeared on Parsons Sun.


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