North American Meat Institute: White House Economic Council Not Very Economic

90

The North American Meat Institute (Meat Institute) today dismissed another desperate attempt by the White House Economic Council to shift blame for record food inflation to the meat and poultry industry.

“The White House Economic Council is again demonstrating its ignorance of agricultural economics and the fundamentals of supply and demand,” said Meat Institute President and CEO Julie Anna Potts. “This argument is simply a rinse and repeat of their September attempts to blame meat and poultry companies for inflation that is not limited to food, but is being felt across the economy.

“Beef, pork and poultry all have their own supply and demand market fundamentals. The calculations used by the Economic Counsel awkwardly and misleadingly combine these sectors and the Council’s analysis conveniently excludes data on rising input costs, rising fuel costs, supply chain difficulties and labor shortages that impact the price of meat on the retail shelf. Plus, recent economic data indicates packer (wholesale) margins have fallen by 30-60 percent depending on the species as the industry works through the historic supply chain disruptions of the last 18 months.

“This cherry picking of data is obvious to all. It is no coincidence this blog post appears on the same day as the Consumer Price Index is released showing gas and energy prices are up nearly 60 percent over the past 12 months which is nearly 10 times the rate of inflation for food.

“The Economic Council continues to insist market structure is the reason for higher consumer prices of meat and poultry. In beef production for example, the same four firm concentration ratio has been operating in the market for nearly 30 years. Why the sudden inflation?

“The answer is consumer demand for meat and poultry products has never been higher. Members of the Meat Institute are producing more meat than ever before under extraordinary circumstances to keep our farm economy moving and to put food on American’s tables.”