'Great Recession' Plus High Corn Prices Are Changing The American Diet

feedlot beef cattle photo

Beef cattle feedlot. Image credit:WhyFiles, via USDA

I was surprised to read in Business Week, via Bloomberg, that "the U.S. cattle herd may have shrunk to the smallest size since 1958,..." Farmers are culling herds because demand for red meat is down in this Great Recession (thanks Wall Street), while corn prices are way up (thanks Congress for the luxuriant corn-based ethanol incentives).

From the farmer's viewpoint: "Corn, the main ingredient in livestock feed, jumped to a record $7.9925 a bushel in 2008 on the Chicago Board of Trade, and prices averaged about $3.79 last year, the third-highest annual average since at least 1959." With the cited level of herd reduction, corn prices will fall eventually, helping ranchers - unless Congress goes for another round of ethanol incentives first! (Makings of a classic challenge and response scenario that will play out for years more.)From the standpoint of changes to the American diet, it's not that meat prices have gone up that much (see data here); it's that people have less to spend on it, period. Go stand by the butcher counter about 4pm on a weekday and watch the body language. You'll see customers reach for fancy packages, examine price tags, shake heads, and walk away.

Staple choices for Americans are adapting to a new reality.
Less expensive cuts of meats and smaller amounts of meat per meal, with more veggies and grain. These are the new choices for the middle class. Those with no jobs and the working poor are probably already there.

Unknowingly, I expect, more Americans will slowly adopt the preferences of a most-honored founding father. According to A Day In The Life Of Thomas Jefferson on Monticello.org:

Jefferson ate meat only "as a condiment to the vegetables which constitute my principal diet." Many family members remarked on this habit, and though we cannot call Jefferson a vegetarian as defined today, for his time, he did eat an unusually small amount of meat, preferring the produce of his garden. The garden featured more than 250 varieties of herbs and vegetables, including those that others considered exotic or even possibly poisonous, such as the tomato.

Back to the present.
Unlike meat, American cheese prices are rising dramatically, which indicates growing demand.
The price of class III milk, used to make cheese, tumbled to a six-year low last year of $9.24 per 100 pounds, after global demand slowed. The price has rebounded 57 percent since then to $14.54 yesterday on the CME.

Consumer responses?
I've noticed cheese prices going way up lately. My response has been to buy stronger tasting, aged cheeses and use them as low-volume flavor builders in complex dishes. I also buy less beef lately, as I prefer now the taste of buffalo and venison.

What used to be known as "Good Seafood" is way too expensive, period. Only the Wall Street fat cats, captains of industry, and real estate moguls, can support what's left of unsustainable fish species market. Seafood choices for my table are tilapia and cat - or what I can catch.

These changes came slowly to my kitchen and I bet the same it true for more Americans. More will come, no doubt.

What are your observations about these trends? How have you responded?