Scarcity and price hike plague the beef industry

Beef costs hit record highs amid supply chain woes The rising price of beef has butchers, farmers and consumers feeling the heat.

A record high in prices for steaks, ground beef and roasts at the grocery store is also being felt up the chain by those in charge of processing cattle.

While the price of beef is known to fluctuate, over the last several years, prices have steadily been on the incline.

Record Highs

"For a side of beef from three years ago, it's just about double for us," said Jack Clark, a butcher and co-owner of Hind Quarter Meat Co. in Barrie. "From last year about this time, I want to say it's up about 20 per cent."

Hind Quarter Meat Co. started as a pop-up store three years ago and struggled out of the gate to take off, but in 2023, its owners were able to set up a bricks and mortar store.

Clark said customers have taken notice, opting to purchase cheaper cuts like flank and hanger steaks rather than ribeye's and tenderloins, which are typically double in price.

The price hike comes as butchers and grocery stores enter their busiest season over the holidays.

"It's going to be very important for the beef sector to make a more sustainable model to get prices under control," Clark said. "There needs to be more slaughterhouses in Ontario. There's a lot of beef here but the supply and demand is thrown off by too many large processers and not enough small ones."

Farmers Struggle

The Beef Farmers of Ontario (BFO) represents 19,000 beef farmers in Ontario.

On its board of directors is Jim Whitley, a 4th-generation farmer in Creemore.

"Our calf prices are what we've never seen," Whitley said. "They're quite exciting and encouraging and to be honest, they're right back to where they need to be."

Whitley said prices dropped in the mid-2000s, but rallied back in 2014 and have been on the up since.

However, while beef as a commodity garners more prices, so too do the the overhead costs for farmers.

Whitley said drought, pandemic-rattled supply chains and soaring feed and fuel prices have taken a toll on those who raise their herds.

Cattle Shortages

All of that is compounded by a population of cattle that has significantly dwindled over the years.

"The inventories are as low as they've been since 1987, so with the cattle numbers being low, that means there's less cattle around," Whitley added. "At the same time, population is going up, so there's more demand on the market."

Recent numbers from Statistics Canada indicate the Canadian cattle herd fell 1.4 per cent from last year on July 1, to 11.9 million head.

Beef cattle took an even harder hit, dropping 2.2 per cent to about 3.49 million head.

At the Ontario Stockyards in Cookstown, auctioneers have seen the results of that scarcity.

Ab Carroll is the general manager of the stockyards and said it averages anywhere between $4.5 million to $5 million a week, or over $200 million annually.

"Increasing herds can take years to do," Carroll said. "You're looking at about two and a half to three years to get a calf on the ground and then another 6 to 9 months after that to raise it up to a marketable size."

One way that could help, is by helping younger generations to get into ranching.

Carroll said low profit margins makes entering the profession a daunting task.

"We're seeing more and more of these producers age out, the average age of the producer is getting higher and higher every year, less young people coming in," he said. "So if we can look at maybe lower interest rate loans and longer terms, some of these guys could at least take bite-sized portions to get in."