As news of meat processors and slaughterhouses halting operations made their way to the airwaves some of our customers started to panic. "Are you seeing shortages in the supply chain?, "hows your stock?", "will America run out of meat?".
The answer is. Keep calm. Eat meat.
America is not running out of meat anytime in the foreseeable future. Neither we nor other Meat purveyors will run out of meat. In fact, Meat inventories are up. While you may not know this... America exports A LOT of meat (500 million pounds of beef and a lot of pork) and as borders have closed or tightened, exports have slowed down.
What you will see (and we are already seeing) are some crazy fluctuations in price as the market adjusts to the new reality.
As restaurants shut their doors, the market was flooded by big chain players trying to move inventory to try to cut their losses... this meant selling everything as fast and as cheap as possible.This led to overall price decreases as supply outstripped demand.
This is why our prices dropped over the past couple weeks as we have a policy of fair pricing (which is why we don't do "discounts" or "sales"). For example our USDA Prime Center Cut Filet Mignon of 8oz went as high as $36.99 and is currently $26.99. We may need to increase again... we will adhere to our policy.
There is A LOT of Frozen inventory out there, specially from companies who took positions on product to speculate (remember, meat is a commodity). This sometimes irresponsible behavior has led to many of the large industry players to lay off workers and close plants. Expect big box stores and non-reputable industry players to start advertising beef at prices never seen before... expect industry insiders or those with beef to unload to start selling B2C (Business to consumers). But beware of the quality. Buy from reputable players whose processes and quality you know and trust.
SO NOTHING TO WORRY ABOUT?
By no means am I downplaying the impact of plant closures. Certainly there will be an impact. Particularly in pork. But when it comes to the upper echelon on quality... we do not expect shortages.
You may see some shortages on imported product (Australia / Japan) or Fish from the Mediterranean. But so far, supply remains steady.
Some higher end domestic programs have cut back on processing to address the new lower demand. As a result, instead of producing 160 Picanhas a week, we get 80. But this is a calculated move because the high end steakhouses who usually say a Ribeye for $120, are closed. This is not a shock to the system, this is a reflection of reality and is the healthy thing for these providers to do.
In the near term expect pricing to slowly creep back up, but we do not expect December 2019 levels of pricing for a while.That said, unlikely, but not impossible.
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