Summary
Retail protein prices have risen throughout 2010 reaching what we believe to be a record high for the beef, pork and chicken average.
Analysis
The chart of the week the average retail price for beef, pork and chicken. (see chart here- http://www.americanrestaurantassociation.com/content/record-high-retail-protein-price-average/). This is not to be confused with what we, as a company, mostly track which are wholesale prices and futures as these impact our clients products more so than retail prices. That being said, retail prices cannot be ignored. Part of the reason that wholesale protein prices appreciated during the latter part of last year was due to a decline in retail prices. Case in point, retail pork prices last December were the lowest for the month in seven years. Wholesale pork prices during December 09 appreciated roughly 15% which was the first such substantial increase in the market during the month in at least the last 10 years. Lower retail prices encouraged consumers to buy which, in turn, boosted volumes for wholesale protein products. As one can tell from the chart, retail protein prices have risen throughout 2010 reaching what we believe to be a record high for the beef, pork and chicken average. As low retail beef prices usually encourage consumers to buy, the inverse is true when retail protein prices are inflated. And this could impact demand as we move into 2011.
Source: Gerson Lehman Group
