Potential for meat shortages may go away sooner than later

Huge grocery chains and even fast-food giant, Wendy's, have announced some unavailability or temporary rationing on the amount of meat customers can buy. But before you run out and try to jam your refrigerator full of meat, pay attention to why this problem may go away sooner than later.

Grocery giants Kroger, Costco and others are limiting meat purchases while one in five Wendy's won't be selling burgers.  

To avoid meat hoarding, many grocers are limiting purchases. UC Davis Professor Daniel Sumner is a renowned agricultural economist.

"As consumers, we're probably gonna pay a little more and/or another way the stores will say, 'Well, we don't want to raise our prices too much, so you'll only buy two packages,'" said Professor Sumner.

Coronavirus has shut down numerous meat packing facilities causing a shortage. Beef, pork and chicken farmers are paying a huge price. "Those folks are in trouble because they've got big supplies that can't get processed," said Sumner. As closed plants slowly reopen to workers, it will not be business as usual.

"You give them their social distance at work, that means you have to slow down everything. You have fewer people on the line. It all goes slower," said Sumner.

To assure a reliable supply, much of the nation's wholesale meat is purchased far in advance of delivery at a price determined by the futures market. With tens of millions of layoffs, supply and demand are uncertain.

"So the slaughter people are saying, 'We're not gonna pay much for those pigs three or four months from now.' And the farmer says, 'Well, in that case, it's not worth putting a whole bunch of corn and soybeans in them,'" said Sumner.

Even small retailers, such as Oakland's Village Market, are seeing meat price increases.

"Yeah, I was talking to my meat manager and he said it's kind of a range depending on the meats and the cuts; you know as much as a dollar a pound," said Village Market Owner Keith Trimble.

But since this store always buys locally, supply volumes are more reliable. "We buy it from Petaluma Poultry and Harris Ranch and Niman Ranch and they're all local producers," said Mr. Trimble.

While hoarding is unlikely here, the market is willing to protect all its customers.

"If we start to see too much of that, we'll cut back on what we're allowing people to buy, just like we were doing with eggs and toilet paper and things like that," said Trimble.

For now, this problem seems to be short-lived. "I certainly wouldn't encourage anyone to say, 'Well, we're running our of meat.' because we're not." said Professor Sumner.

A nearby Safeway in Oakland has yet to take such steps on limiting purchases.