Meat prices soar in time for grilling season

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Canada's inflation rate is tame, but meat lovers see a different picture – prices for steaks and chops are soaring, just in time for barbecue season.

The price of a sirloin steak has risen 12 per cent, and pork chops are up 16 per cent in the past year, Statistics Canada says. By comparison, overall inflation is just 2 per cent, or 1.9 per cent for a broad range of food.

The reason? A piglet-killing virus has sent hog prices soaring, and fewer cattle are being sent to slaughter as herds have been slow to recover from years of culling. At the same time, North American grilling season is here, and slaughterhouses are bidding up prices to meet rising demand from grocery stores and butcher shops.

At Halifax butcher shop Getaway Farm, owner Chris de Waal has refused to pass on the higher costs to his clientele, until this past Saturday, when prices for pork and beef went up.

"The price of any animal has skyrocketed," said Mr. de Waal, whose family business buys calves and raises them to market weight on a farm in the town of Canning, N.S., before slaughtering them and selling the beef to customers at the downtown shop.

Livestock might be raised locally, but it is priced in Chicago. The price of live hogs on the Chicago Mercantile Exchange has risen 45 per cent this year. Cattle futures are up 14 per cent. The increases have helped Canadian ranchers and pig farmers, who have endured years of soaring costs, but it means processors and consumers are paying higher prices. Maple Leaf Foods Inc. recently said it matched the industry's 14-per-cent price hike for bacon and hot dogs in the first quarter of the year, and more increases would follow.

Unless consumers switch en masse to chicken and other cheaper meat, high prices for beef and pork will not ease for a few years, given the time it takes to raise cattle, and the deadliness of the pig virus that has no cure, said Kevin Grier, a livestock and meat market analyst with George Morris Centre, a food and agriculture research institute in Guelph, Ont.

Producers need to be confident prices will remain high before they decide to withhold cows from the market to breed. It takes at least a year to raise a calf to market. A pig gets slaughtered at about six months, but Mr. Grier reckons porcine epidemic diarrhea will reduce the number going to market in August and September by 46,000 in Ontario.

"The bottom line is the farmer has to decide, 'Hey, things are really good, and I'm going to retain these females and instead of steaks, I'm going to make them into mothers.' Right now, it's just too tempting to keep them going to the market," Mr. Grier said.

Mr. de Waal, who has been in business for five years, says he has been able to limit his price increases to the point there is not a big difference between the price of the pasture-raised meat he sells and the supermarket.

"The good news to all this is farmers are making money for a change, so that's nice," Mr. de Waal said in an interview. "[And] the margin of difference between properly produced, sustainably raised, ethically treated animals and commodity beef is starting to shrink. So folks who used to make their purchasing decisions based on dollars and cents are now saying, 'Hang a second: I am going to have to eat less beef anyway because of the price – I may as well as well spring for the extra few cents a pound and buy something that is locally produced.' So we are seeing a lot of people coming in that we haven't seen in the past."

Jessi Gillis, owner of Halifax butcher and produce store Highland Drive, said she is paying about 30-per-cent more lately for beef and pork. The downtown shop has been has been absorbing some of the higher costs, but has been forced to gradually raise prices.

Ms. Gillis, who sells beef from two local farms that raise cattle in pastures without hormones, said some customers have been questioning the increases. But she said most seem to understand farmers are facing higher costs for such things as feed, and want to support businesses that produce food sustainably.

"They're pretty good at seeing the big picture," Ms. Gillis said.