Beef returns from U.S. likely to rise

Press, 4 January 1978, Page 22

Beef returns from U.S. likely to rise

NZPA staff correspondent Washington

The president of the American Meat Institute (Mr Richard Lyng) has said he thinks retail prices of hamburger and processed beef, the kind of meat New Zealand ships to the United States, will rise by between 10 per cent and 15 per cent in 1978,

Mr Lyng also said he expected shortages of such meat to develop in the United States and worldwide in the next two or three years. Mr Lyng made his forecasts at the institute’s annual “outlook for meat” press conference in Washington. The institute is the national trade association of the meat packing and processing industry. His predictions on rising .hamburger prices and supply shortages echo the projections of the United States Department of Agriculture and Mr Maurice Jones, the retiring North American director of the New Zealand Meat Board.

Mr Jones said earlier this month he believed prices for New Zealand beef, C.I.F. New York could average 10c a pound higher or even more in

1978 compared with this year.

Each 10c price rise means S3OM more for New Zealand in export

earnings. In the last two months, prices for imported beef have risen from below 60c to 68c at present. However, a firm idea of the real situation will not emerge for a week or two until the trade settles down to the post C h r i s t m a s-New Year period. But stocks of imported beef are low at present, due in part too the recent dock strike, and that is encouraging for future prices movements, according to informed sources. Mr Lyng said that the American public would have more pork and less beef in 1978, with meat prices remaining reasonable on average. Prices for ail beef could rise slightly with hamburger and processed beef prices probably higher because of the decline in slaughter of non-grain fed cattle.

“Prices for higher grades of beef should be held in check by the increased supplies of beef out of fedlots.” Mr Lyng said the recent high slaughter rates of non-fed cattle as a result

of poor prices and drought was "bottoming out” and

farmers were now retaining cows for herd rebuilding.

He predicted that the 1978 slaughter of non-fed animals and cows and bulls — which together provide the meat for the hamburger and processed meat trade — would be 31 per cent of the total cattle kill. This contrasts with 38 per cent this year, 41 per cent in 1976, and 48 per cent in 1975. and is the strongest evidence for projections of an approaching shortage of hamburger type meat. If shortages develop, as expected, Mr Lyng said he thought retail hamburger prices might rise from the present $1 per lb to $1.25. “That would be very high and at that figure would start to attract ground meat from fed cattle producers.” Mr Jones said in a recent interview he thought that approaching shortages of lean beef could lead to

the Administration ending 4restrictions on imports to combat such shortages and resultant rising prices. Mr Lyng would not be drawn into predicting whether he thought this would happen.