Beef prices jump as consumers buy it up

Beef is red hot — for now. U.S. wholesale prices for the premium protein leaped the most in over two years on Monday as coronavirus-fearing consumers cleaned out meat cases at grocery stores in bouts of frenzied buying. The effect may be temporary as restaurant closures begin eating into demand for steaks and other pricey items.

Cheaper cuts like rounds and chuck that end up in retail stores were behind Monday’s gains, said Altin Kalo, an analyst at Steiner Consulting Group.

Wholesale beef rose 7.8 percent to $2.2436 a pound Monday, data from the U.S. Agriculture Department show.

The cattle futures market surged after USDA showed the higher beef prices. However, April live cattle futures closed 3.9 percent lower as broad jitters about demand and economic growth continued to weigh.

“Consumers have gone there and cleaned out all the meat cases, and you need to refill them, so there’s a scramble to get product,” Kalo said.

While restaurant closures across the U.S. are negative for beef, their effects won’t come into play for weeks. Meanwhile retail demand is immediate, said Kalo. Food-service shutdowns will have a disproportionate impact on more expensive cuts of beef, like prime steaks, said

Alan Brugler, president of Brugler Marketing & Management LLC.

Wholesale buyers may also be stocking up because they’re concerned about virus-induced labor shortages at plants, which could lead to a sudden reduction in the amount of beef coming onto the market.