The thought occurred to me, while driving in the quiet of some beautiful hill country on the Indiana-Ohio border in mid-November, that maybe I should have told my wife to buy more meat. She’d called earlier from Costco to ask what we needed, and all I could think of was to get “some ground beef.”

We’re not ones to stockpile goods; even in the panic of the COVID-19 pandemic, we did not buy in bulk. That thought surfaced, though, with a heightened awareness of surging meat and poultry prices, which have helped push overall prices to a level not seen in 30 years.

I pondered whether to stock up on a relatively cheap meat at its current price and avoid buying more and more later at potentially higher prices each time. Well, duh. This isn’t a novel concept; price-conscious consumers go about it that way all the time. But if a hopelessly buy-as-needed person like me is thinking that way, then price-consciousness or sensitivity must be a mounting and influential counter force. But is it?

The University of Michigan in November painted a grim picture of consumer sentiment in tough economic times. That sentiment, after all, fell in November to its lowest point in the last 10 years, and inflation was among the top concerns.

Indeed, inflation is occurring in staple goods across the board. But it’s rising meat and poultry prices — with beef, poultry and pork up a respective 20.1%, 7.5% and 14.1% in the last 12 months through October — that are adding fuel to the fire on large packers already being sued for alleged market manipulation and price-fixing.

One would think if consumers think they’re being gouged, they’d stop buying so much damn meat. And one might say, “Sure, Tyson enjoyed record profits on the strength of higher beef (33%), pork (38%) and chicken prices (19%) in its latest fiscal quarter, but sales volume decreased” to suggest the start of such an undertow.

But demand — or consumers’ willingness to pay — is not, as Purdue University ag economist Jayson Lusk says, an “on” and “off” switch. There’s an elasticity to it. Demand for beef, for example, on an aggregate level is often estimated at -0.6. This means that a 1% increase in price results in an aggregate 0.6% reduction in quantity of beef demanded, assuming that consumers’ willingness to pay hasn’t changed.

In recent months, though, as evidenced by strong domestic and international consumer demand, willingness to pay has increased. So, in this case, says Lusk, a 1% increase in price might have even less than than a -0.6% impact on demand. In fact, he says, it is possible for both price and quantity consumed to increase if willingness to pay is increasing.

High grain, labor, freight and energy costs are expected to continue through 2022, and so the industry likely will have little choice but to continue to pass those costs onto the consumer. If the consumer continues to pay for them, perhaps the supply chain will boost animal inventory — and help lower prices that way.

Until then, increased awareness of rising prices might be just that, rather than any significant behavioral reaction to them.

I never did, by the way, call my wife back and tell her to buy more meat. We’ll run out, and I’ll do as I always do: I’ll go to the store, pick up some more and pay the price.

This article ran as the Editorial in the December issue of Meatingplace magazine.

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