Record cattle prices are threatening to push steak off the menu and take the sizzle out of beef sausages in Australia.
According to The Australian Financial Review today, some beef cuts have spiked by as much as 50 per cent in the past six months thanks to strong overseas buying – driven partly by the softening Australian dollar – and drought conditions.
The big price rises are putting the squeeze on margins in the meat processing industry and sparking warnings that shoppers need to get used to paying more for beef.
Butcher Peter Bouchier admitted it was very difficult to pass on the big cost increases to shoppers.
"There's just no cheap beef any more and it's the cheaper cuts that have probably taken the biggest rise, chuck, stewing steak and trimmings, which we use for sausage meat," he said.
Mr Bouchier, who has several Melbourne outlets, warned some expensive cuts of beef could disappear from butchers and restaurant menus altogether.
The major retailers are also grappling with the big price hikes.
A major Australian supermarket chain, Coles, said the price rises in beef were great news for farmers but had forced the supermarket giant to "minimise" the impact for some of these increases.
"[However] for some beef products in our supermarket, . . . we have needed to increase prices to reflect the higher cost, "a spokesman said.
An another supermarket chain in Australia, Aldi, also said rising prices were making it challenging to find cheaper cuts of beef.
"However, what we may see is consumers trying new cuts of meat like chicken or pork," a spokesman said.
CWB The House of Quality Meat supplies product to the restaurant industry and holds major contracts with pubs and clubs.
Tarik Yalcin, who has worked at CWB for 16 years, warned the higher prices for steak and sausages were here to stay.
He said it was hard to see what would bring them down given the ongoing overseas demand for Australian meat.
"Everything gets driven by the export prices," Mr Yalcin said.
The high cost of cattle is also hurting meat processors, which are cutting shifts and reducing production.
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