Fire Up the Grill. I'm Greg Martin with today's Line On Agriculture.
Get out the charcoal. It's time to fire up the grill. Memorial Day is the unofficial start of grilling season, which is certainly good news for livestock and poultry farmers.
ANDERSON: Memorial Day is significant it's a weekend holiday where we expect people to be out going to the lake, getting in the backyard. Whatever they're going to do, a lot of time it's going to involve a grill and that grill is going to have meat on it.
American Farm Bureau Livestock Economist John Anderson says livestock and poultry farmers have waited a while for good news. They'd been losing money since back in 2008, putting a lot of folks out of business. Finally prices started edging back up at the beginning of this year.
Anderson: That has been reflected by a couple of things: a fairly tight supply situation, but also some improving demand as the economy has grown. So we've coming into this Memorial Day season at historically what are pretty good prices and that's been very favorable for our producers who very much needed to see some price improvement because of the rough couple of years they've been through.
And while that does mean higher meat prices for consumers, Anderson doesn't think many would want to return to the situation last year.
Anderson: I don't know that anybody is going to look back fondly in 2009. Prices were much lower, which was good from a consumer standpoint, but consumers were still feeling very strapped by all the other things that were going on in the economy. From that standpoint, 2010 is really better for everybody. Meat prices are higher. Consumers are going to pay more, but that reflects the fact that demand is stronger which would suggest that consumers feel like they're in a position to pay more.
One uncertainty this grilling season is the price of meat.
Anderson: Now we're going to watch and see how demand shapes up over the holiday weekend. You know what kind of clearance do the retailers get? What kind of movement do they see out of there their meat cases? Is demand going to be strong over the Memorial Day holiday? Is it going to be weak? That's kind of going to set the tone for how we move now into the early summer months. If movement's very good that's a very positive sign for demand moving forward. It may keep retailers fired up about continuing to feature meat and try to aggressively market meat. If demand is weak they may recalibrate a little bit there. So at this point as Memorial Day approaches we're kind of in a wait and see mode.
Anderson says the good news is that meat prices may start to dip mid-summer.
Anderson: Typically we do see the market pull back some as summer gets under way. most of that really comes from the supply side, not the demand side. Summer tends to be a pretty good demand season overall because there is a lot of outdoor activity, a lot of grilling and things like that. But it's also a time of year when we get bigger production coming on line, particularly in the beef industry. We're very accustomed to seeing wholesale meat prices and cattle prices slip in the summer months because of those more abundant supplies coming on line.
That's today's Line On Agriculture. I'm Greg Martin on the Ag Information Network.
