From CattleFax:
We hear a lot about beef demand as a function of price, particularly during a recession. There are various demand models, and CattleFax has developed one as well to understand the price/usage relationship. Rather than delve into the details of the current domestic demand situation, let’s take a larger, longer, look at what demand may or may not do over the next 10 years.
Currently about 9% of U.S. beef is consumed overseas. 91% is consumed here domestically. However, more than 95% of the world’s population lives outside of our borders. This potential pool of demand is staggering. Bans, quotas, and tariffs limit our potential in many markets. Low incomes keep us out of others. It is unrealistic to target a wide percentage of the global population, however, a unique variety of cuts and variety meat items provides a massive potential market for U.S. grain-fed beef, a niche in the global marketplace.
Global population is adding 75 million people per year to the planet. The United Nations’ ag branch (FAO) estimates that global beef production will need to double by 2050, just to keep pace with rising incomes and populations. Key access barriers will crumble under continued pressure, just as they have the past 20 years, i.e.: Japan, S. Korea, Mexico, and Canada. Meat inflation globally is up 21% since January 2009. Global beef demand 10 years from now will likely be phenomenal. Market access and industry innovation are key. Foreign consumer perceptions of safety and traceability need to be addressed. Over the next 10 years, global and domestic demand opportunities for this industry are immense.