Beef prices were already rising before Japan's nuclear crisis, which is expected to increase the cost of summer barbecues. Image: CC wickenden/Flickr

Just in time for barbecue season, add beef prices to the list of things impacted by the Japanese nuclear disaster. Prices for beef and other meats were already rising before the Japan earthquake and tsunami triggered a nuclear crisis. But now Japan’s demand for U.S. meat exports is expected to soar amid fears that domestic beef is contaminated with nuclear radiation.

Radiation increases demand for U.S. beef

Cattle futures rose to a record for the third day in a row Friday, driven by speculators betting that demand for U.S. beef will increase as nuclear radiation levels in Japan contaminate food supplies. Prices rose 7.2 percent in March and 12 percent in the first quarter. According to the federal government, Japan was the the third-largest importer of U.S. beef in 2010. Survival of cattle in Japan’s Fukushima prefecture near the wrecked nuclear plant is in question as radiation contaminates soil and water and forces farmers to leave the area. Hazardous radiation levels have also been detected outside the evacuation radius around the Fukushima plant.

Why beef prices have been rising

U.S. consumers have already been paying more for beef because of soaring commodity prices. Beef has the highest production cost among all meat, and beef production costs went up 14 percent in 2010. For example, cattle farmers pay more for livestock, grazing land, fertilizers, feed and processing systems than poultry farmers. It also takes more time and expense to get cattle ready for sale compared to other meats — about 46 days for a chicken compared to several years for beef. Plus, the cost of fuel used in machinery and trucks is rising. Wholesale beef prices last week rose to the highest point since January 2004.

Summer grilling will be expensive

As U.S. beef producers struggle with escalating production costs, more are selling their animals to the slaughterhouse instead of breeding them to increase their herds. In Texas, the leading U.S. cattle producing state, the worst drought in 44 years is forcing ranchers to reduce herds. According to the National Cattlemen’s Beef Association, last year the U.S. cattle herd shrank to 92 million head, the lowest numbers since 1958. Before the Japan nuclear disaster, export demand from developing nations was already soaring as their citizens gain the means to consume more beef. As exports increase and supplies go down, beef prices could rise more this summer if the U.S. economy continues its recovery. According to the U.S. Department of Agriculture, U.S. consumers could expect to pay as much as 5.5 percent more for meat this year with prices rising faster than food costs in general.


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