Factors affecting beef demand

Abstract

We investigated factors that have affected beef demand over the last two decades. Beef demand is typically modeled as a function of beef prices, competing meat prices, prices of all other goods, and consumer expenditures. Our comprehensive model also investigated the impact on beef demand of food safety issues, health concerns, and changes in consumer lifestyle and demographics. Results from this analysis help explain changes in beef demand that occurred during the 1980s and 1990s. First, consumer concerns about food safety, as measured by increases in beef recalls, had a negative impact on beef demand over the last two decades. Second, consumer awareness of the linkage between cholesterol and heart disease also contributed to the decline in beef demand. In contrast, as the net number of medical journal articles linking cholesterol and heart disease increased, poultry demand actually increased. Finally, increased labor force participation by females had a negative impact on beef demand, because an increase in female employment outside the home likely resulted in a decline in time available for food preparation. Because poultry demand benefitted from this consumer demographic shift and because of beef's negative health image, these results suggest that beef industry efforts to provide consumers with more convenient, high quality products have lagged behind those of the poultry industry.