THE worst of the drop-off in domestic beef consumption courtesy of upward trending retail prices may be done.
Although, the ever-widening gap between traditional steaks and chicken, pork and lamb is fodder for concern.
While the latest Australian Bureau of Statistics figures show beef retail prices rose in the December quarter, to an average $18.50 per kilogram, up 4.2 per cent for that quarter and 11.6pc for the year, butchers are reporting they have stabalised for the most part since January.
Likewise, anecdotally, consumer purchases across the range of beef cuts appear to be holding steady.
However, the overarching trend towards greater convenience appears to be favouring the alternative proteins.
Chairman of the Australian Meat Industry Council's National Retail Council, Brisbane butcher Ray Kelso, said beef retail prices had flatlined in the past month.
The growth in chicken and pork sales, however, was continuing, he said.
“Beef cuts have become more of a boutique line, for special occasions, than they ever have been before,” Mr Kelso said.
Domestic beef consumption in 2015 was 27.9kg per person, down from 30.7kg in 2014.
Meat and Livestock Australia’ forecast for 2016 is for a very small further decline to 27.5kg.
Manager of market information Ben Thomas said that prediction was based on the expectation of a stabalisation of retail prices following the large jump last year.
He said the $18.50/kg average for December wasn’t the highest retail beef prices have been, taking into account inflation adjustments.
In 2006, the average price in today’s dollars was $19.50/kg.
That was a time when Australia was exporting large volumes to Japan after the US was cut out due to disease.
As that situation eased, domestic retail beef prices stabalised and early anecdotal evidence suggested 2016 was ‘following suit’, Mr Thomas said.
“However, in real terms chicken prices do continue to trend lower,” he said.
“But it is not a dramatic fall by any means and it’s not only chicken - in fact pork is where we’ve noticed a more significant shift in volumes consumed per capita.”
That is perhaps what the beef industry should be keeping closest watch on.
Mecardo market analyst Angus Brown, in his latest article titled “Retail beef prices rising but chickens coming home to roost”, points out the beef premium to lamb has reached a seven-year high of 23 per cent, despite retail lamb values being dragged higher by beef.
Beef was now 2.44 times more expensive than chicken, which is an all-time record, and will no doubt see the trend of more chicken meals at the expense of red meat, he said.
Mr Brown it was not surprising the retail beef price rose in the December quarter as it generally lagged the cattle price.
“We suspect retail prices will continue to rise but at a slower rate - in fact, they could track sideways until cattle prices start to ease,” he said.
Consumption, however, seems to be a much more complex beast.
“With less beef available over the coming years, it will be hard to know if decreased consumption means demand is actually dropping off,” Mr Brown said.
Butchers think not.
Mr Kelso said: “The challenge for the industry is promoting the value of beef - the price may have gone up but it is not dear relative to the increases in other consumer goods.
“I paid $35 for a haircut this week where just a month or two ago it cost me $25.
“Mince, for example, is still exceptional value when you take into account the nutritional benefits and how many people you can feed for one kilogram of beef.”
Northern NSW butcher and owner of Pottsville Meats on the Tweed Coast, Peter Barnes, said the trend towards ‘quick and easy’ was making stir fry a popular option and lifting sales of chicken and pork.
When it comes to securing beef custom, the secret was in consistency, he said.
“We do nothing but MSA (Meat Standards Australia) so people always get what they expect and can trust us,” he said.
Mr Kelso said from the point of view of profitability of a butcher, other costs such as astronomical rents in shopping centres were having a far greater impact than record cattle prices.