“Perfect storm” sees beef prices quadruple inflation

The price of beef has shot up by 26 per cent since the end of 2019, almost quadrupling the rate of overall inflation in the same period, with the most acute hikes in Adelaide, Hobart, and Canberra.

Colin Holt, chef and co-owner of Hudson Meats in Sydney’s Cammeray. The price of meat has skyrocketed recently due to upward pressure on all parts of production. Photo: Britta Campion / The Australian

A “perfect storm” has caused the price of beef to shoot up by 26 per cent since the end of 2019, almost quadrupling the rate of overall inflation in the same period.

The surge is due to a combination of lingering effects of the 2017-19 drought, soaring grain and feed prices from Russia’s invasion of Ukraine, increased transport costs from spiking fuel prices, and labour shortages.

The rise in beef and veal prices has been felt most acutely in Adelaide among capital cities, where prices have increased by 30 per cent since December 2019, and least in Melbourne, where prices have increased by 24 per cent in the same period, according to the Australian Bureau of Statistics.

Increases in the price of meat have generally beat inflation since the start of the pandemic.

In addition to meteoric beef and veal prices, lamb and goat meat prices have almost doubled the pace of inflation since the end of 2019.

The the price of pork has kept pace with it and poultry prices have increased only by 4.4 per cent, more than two percentage points behind the rate of inflation.

The price rises have been driven mostly by the more highly sought cuts of beef, said Allan Cooke, owner of Big Country Meats in Coffs Harbour. “The traditional executive cuts have taken the greatest rises,” he said.

This, as well as generally high overhead costs in restaurants, has recently led to a hotter market for secondary cuts, said Colin Holt, co-owner of Hudson Meats at Cammeray on Sydney’s lower north shore. “Restaurants are looking at a lot more secondary cuts – cuts that would normally be forgotten about … so now everyone’s going to be looking at cheeks, and shanks, and stuff like that, which tends to be a little bit cheaper.”

Mr Holt laid most of the blame for skyrocketing beef and veal ­prices on the 2017-19 drought.

“Three years ago when there was the drought ... everyone had to get rid of their breeding stock,” he said. “We have the lowest head of cattle for 20 years.

“What’s happened now, you’ve had all this rain this year, a year ago, everyone’s grass is up to their elbows but there’s no cattle.”

Other animals such as pigs were not affected as much because cows produce fewer offspring and take longer to gestate and mature.

The Russian invasion of Ukraine has also raised grain and feed prices. Russia and Ukraine typically supply about 30 per cent of the world’s wheat. This supply crunch, in turn, has increased international competition for Australian produce.

The Department of Agriculture, Water and the Environment anticipates a higher proportion of Australian grain produce will have been exported overseas in the 2021-22 financial year.

Additional reporting: Rebecca Borg