A Purdue University news release said that although some of the high prices can be attributed to drought, there’s an incomplete understanding of why the prices have skyrocketed.
“It is easy to list some possible causes, but none of them seem to be large enough to have caused such startlingly high prices,” said Purdue’s extension economist Chris Hurt.
Hurt listed possible reasons for beef prices being high, but said that some who guessed that demand may have been up as supplies were low were proven to be wrong when the first-quarter GDP growth was only 0.1 percent.
The unexplained high prices so far this year have shown cattle ranchers new possibilities for profit potential, Hurt said in the release. Citing National Oceanic and Atmospheric data, the release said it is projected that only 15 percent of the brood cows will be in drought areas; about 85 percent of the beef cows will be in regions that can support herd expansion.