1 However, this behavior has resulted in rising retail beef prices, while farm‐level fed cattle cash prices are declining (16% decline from the beginning of this year and a 9% decline year‐over‐year, McMillin, 2020). The shortages have more to do with problems with in‐store logistics and not with shortages in the rest of the supply chain. Current stockouts occur because consumers are “forward buying” in anticipation of future restricted mobility. “(A)ll the beef was gone (except for a bit of ground beef), about half the pork was gone, and chicken was plentiful” and, further, that new plant‐based burgers are not being purchased (Lusk, 2020).Ĭertainly, this is an initial reaction and there is no particular reason for the trend to continue. Several trends have been identified for beef consumption as grocery shelves are being emptied by consumers in the anticipation of being quarantined in the future. This creates logistical problems for wholesalers and retailers as they relocate products between sectors. Consumer food purchases have dramatically shifted from “food consumed away from home” to retail grocery sales. Social distancing has drastically changed consumer behavior. Some of the impacts on the consumer are already partially known. Of course, any analysis of the impacts of COVID‐19 on the Canadian cattle industry is at this time purely speculative and should only be used to help outline the potential boundaries of the economic impact and suggest potential avenues for further study. Most of the discussion will be descriptive, but, at the end of the article, I will employ a North American cattle/beef model to consider some possible broad‐brush outcomes. I will discuss the impacts of the pandemic on the cattle beef supply chain starting from the retail sector and working backward to the primary producer. As a result, the impact will be largely driven by logistics and negative income effects for consumer demand and not by traditional supply‐side drivers. Moreover, it is the health of ranchers, feedlot staff, packing plant workers, transport drivers, grocery and distribution workers, and, finally, the population of consumers and their income status that is driving the impacts in the cattle and beef sector. The difference is that COVID‐19 is truly a health crisis. In each case, the market shock resulted in a rapid onset of the impacts. Thicker borders, limited hook space in packing plants, and uncertainty about consumer reactions were all aspects of the 2003 BSE event. Although markets and individuals are reeling from COVID‐19, there is a sense of déjà vu in Canadian cattle markets.
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