Beef Market Equilibrium. Beef Market Equilibrium. Beef Market Equilibrium. Index Tracks Demand Changes. December 2, 2009

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1 Bf Dmand Updat & Pofsso of Agiutua Eonomis Pudu Univsity it P S P E Bf Makt Equiibium D Rsah Suppotd by Cattmn s Bf Boad Q E Q Bf Makt Equiibium Bf Makt Equiibium P P S S 1 S P E P 1 Movmnt fom P E to P 1 is movmnt aong an xisting dmand uv, i.., no dmand shift Q E Q 1 D Q Dmand Shift (din) P E P 1 D 1 D Q E By hoding quantity onstant, w an s what happns to pi Q Indx Taks Dmand Changs But it dos not addss why dmand shifts oud Bf Dmand Dtminants Pojt Thanks to Suppots of this Rsah Cattmn s Bf Boad & Aabama Cattmn s Assoiation Nbaska Bf Couni Cooado Bf Couni Okahoma Bf Couni Gogia Bf Boad South Dakota Bf Industy Couni Idaho Bf Couni Txas Bf Couni Iowa Bf Industy Couni Wyoming Bf Couni Mississippi Bf Couni Wisonsin Bf Couni Sou: USDA, Dpt. of Comm & Jams Mintt, Pudu Univsity Pi Dfatd By CPI, 1980 =100 fo Choi Domsti Bf Dmand Indx Pudu Univsity 1

2 Bf Dmand Mod Dsignd To Addss Why Shifts Oud bf quantity & pi ompting mat & oth goods pis onsum xpnditus food safty hath nutition MACROECONOMIC EFFECTS: Consum Inoms & Expnditus onvnin Wak Consum Inoms Mans Consum Spnding Wi Din Psona Disposab Inom vs. Psona Consumption Expnditus Quaty at Annua Rat, Sasonay Adjustd, T 12 i 10 8 Rssion Psona Disposab Inom i 6 o 4 n Psona Consumption Expnditus 2 $ 0.1 Consums Pushing Savings Rat Bak Up Whih Wi Continu to Hod Down Consumption Psona Savings % of Disposab Psona Inom Quaty, P n 2 t 0 Rssion -2.1 Sou: Buau of Eonomi Anaysis Sou: Buau of Eonomi Anaysis Consums Pud Bak on Food Puhass But Stating To Rbound Quat Chang fom Pv. Q 3.0% 2.5% 2.0% 15% 1.5% 1.0% 0.5% 0.0% -0.5% -1.0% Pntag Chang in Psona Consumption Expnditus fo Food Quaty, Annuaizd Rat, Sasonay Adjustd, % Sou: Buau of Eonomi Anaysis u Invstmnt Vau Consums A Tading Down $14,000 $12,000 $10, $8,000 $6,000 $4,000 $2,000 $0 But Sti Vau Convnin Jan. Wky Vau Ov Tim of $10,000 Invstd on Jan 2, 20 in Std Food Companis Jan. 2, 20- Nov. 30, 2009 Fb. Ap. Jun Aug. Ot. Who Foods MDonads Dow Jons Industias Ruth s Chis Hospitaity D. Jan. Ma. May Ju Sp. Nov Pudu Univsity 2

3 Bf dmand & th U.S. Eonomy bf dmand bnfitd fom Long-un gowth in U.S. onomy & ow savings at But wak inoms & inas in savings at in 09 hoding bak bf dmand Na-tm, onsums dision to hod down xpnditus wi ontinu to dominat oth fos affting bf dmand CONSUMER INCOMES & EXPENDITURES Bf Expnditus A Sma Rativ to Inom Bf, Pok, and Pouty Expnditus As a Pntag of Disposab Psona Inom, % Bf + Pok + Pouty 3.0% S 2.5% h 2.0% Bf a As xpnditus absob ss inom 1.5% onsums tnd to bom ss pi sponsiv 1.0% Pok 0.5% Pouty 0.0% Ya Rsuts Pi Effts 1% inas in bf pi ads to a 0.42% das in quantity dmandd Sma spons to pok & pouty pis Impiations Don t giv onsums a ason to not buy bf Stiv to impov podut quaity Povid satisfatoy ating xpins Sou: USDA and LMIC R 15 FOOD SAFETY 12 Consums Pay Attntion to Food Safty a s Bf Food Safty Ras Cass I & II Ras, Quaty, Inas in as duing 2007 sutd in a 2.6% dmand din 0 Sou: U.S. Food Safty Insption Svi Pudu Univsity 3

4 Rsuts Food Safty Bf Dmand dins as safty as inas Two vs of impat Cunt pus1 & 2 quat aggd sponss 10% inas in bf as 0.2% din in bf dmand Ras sponsib fo appoximaty 2.6% din in bf dmand duing 2007 vs Impiations Rsuts Food Safty Consums xpt food to b saf Shap inas in as (suh as 2007) dos gnat signifiant domsti dmand din Confims nd to b poativ on food safty Conns About Hat Disas & Bf Sti Hoding Bak Bf Dmand HEALTH INFORMATION 100 A t i s Atis Pubishd Rfning Hat Disas & Dit Mdia Jounas, Quaty, Sou: Mdin Rsuts Hath Infomation Rsuts indiat bf dmand dins in spons to infomation inking dit, fat, hosto & hat disas 10% inas in jouna atis inking dit & disas 0.2% 02%d din in bf fd dmand d Compaing 2004 to 1982 inas in atis inking dit, fat, hosto & hat disas xpaind a dmand din of about 9% Rsuts Hath Infomation Impiations Continu ommuniating bf s positivs Emphasiz bf s nutitiona poptis Consums Hath & nutition pofssionas Pudu Univsity 4

5 Consums Rspond To Nutition Info. NUTRITION INFORMATION Nt Atis Pubishd Rfning Atkins Dit Positiv Minus Ngativ Atis, U.S. Nwspaps, Quaty, A 400 Atkins Dit Boostd Bf Dmand t 300 i s Sou: LxisNxis Rsuts Nutition Atkins-typ typ dits suppotd Bf Dmand Doubing of nt positiv (positiv minus ngativ) atis on Atkins Dit d to 0.8% inas in bf dmand Fom 1998 to 2003, mdia infomation suppoting Atkins-typ typ dits boostd bf dmand about 2% Consum Awanss About On of Bf s Positivs Is Inasing A t i s Atis Pubishd Rfning Zin o Ion o Potin & Dit U.S. Nwspaps, Quaty, Sou: LxisNxis Rsuts Nutition Bf Dmand bnfitd fom inasing onsum awanss of bf s nutitiona bnfits 10% inas in atis fning Zin, Ion, Potin & Dit d to 0.25% inas in bf dmand Atis in 2007 w up 268% ompad to 1982, boosting bf dmand about 7% Impiations Rsuts Nutition Atkins and ZIP (zin, ion, potin) indis dmonstat pow of positiv infomation Industy nds to Communiat how bf fits into a hathy ifsty Idntify & Rsah oth nutitiona bnfits Emphasiz nutitiona poptis Pudu Univsity 5

6 Fma Empoymnt Sugd in 80 s & 90 s But Lvd Off Ov th Last Dad CONVENIENCE 62% 60% 58% 56% 54% 52% Pnt of Fmas Empoyd Outsid th Hom Quaty, % Sou: U.S. Dpatmnt of Comm Rsuts Convnin Bf dmand dind as fma mpoymnt outsid th hom inasd 1% inas in fma mpoymnt outsid hom -0.6% din in bf dmand But +0.6% inas in pouty dmand Food Consumd Away fom Hom Inasd But Lvd Off Rnty 48% 46% 44% 42% Pntag of Food Consumd Away Fom Hom Quaty, % Sou: U.S. Dpatmnt of Comm Rsuts Convnin Bf dmand dind as Fma mpoymnt outsid th hom inasd 1% inas in fma mpoymnt 0.6% din in bf dmand Food onsumd away fom hom inasd 1% inas in food onsumd away fom hom 1.6% din in bf dmand Pouty bnfitd fom ths tnds Why? nw podut poifation mphasis on onvnin Rsuts Convnin Impiations Pouty bnfitd as fma mpoymnt outsid th hom inasd Why? nw podut poifation mphasis on onvnin Bf an spond by dvoping and makting mo nw poduts onvnint, tasty, nutitious & a good vau Pudu Univsity 6

7 Bf Dmand Pojt Th Big Pitu Consums vau onvnin Convnint bf poduts hav gat potntia Consums spond to nw poduts that mt thi nds Consums a ptiv to infomation about hath and nutition Povid positiv hath & nutition infomation to onsums Safty of bf is sti impotant Pudu Univsity 7