Consumers are set to pay the most ever for hamburgers and steak for this year’s Fourth of July holiday as rising demand pushes beef prices to a record and increases the cost of a basket of barbecue staples.
The CHART OF THE DAY shows retail beef jumped to a record in May and the cost of seven foods commonly consumed while grilling gained 1.8 percent from a year earlier. Rising prices may not crimp demand for foods eaten on the American holiday because it falls on a Wednesday this year, boosting sales for parties on the weekends before and after.
“This is a boom time for us,” said Beth Weiss, a spokeswoman at Omaha Steaks, the largest U.S. direct shipper of beef that now has 80 stores. “On the Fourth of July, you grill, that’s what you do. I can certainly understand that there are more parties if the Fourth falls mid-week.”
July 4 is the most popular day of the year for Americans to grill outdoors, according to the Hearth, Patio & Barbecue Association. Beef prices have climbed as U.S. exports reached a record last year and the domestic cattle herd shrunk to the smallest since 1952.
Meat packers “feel like they’re getting a three-for-one bang for the Fourth of July,” Ryan Turner, a risk manager at INTL FCStone, said during an interview in Chicago. “It’s a really good thing for them because they catch the weekend before, catch the day of and catch the weekend after.”
U.S. retail beef climbed to a record $4.687 a pound in May, according to the most recent data from the Department of Agriculture. The price is a composite that includes choice beef and other beef and hamburger values. The Bloomberg-compiled index of barbecue staples comprises lean ground beef, white bread, American cheese, iceberg lettuce, tomatoes, ice cream and potato chips.