Wholesale-to-retail price spread increases for U.S. choice beef
The spread between farm prices and retail prices of U.S. choice beef has been rising in real terms since 2000 because of an increasing spread between wholesale and retail prices. The spread between wholesale and retail choice beef prices averaged 75.5 cents/lb during the 1990s, but averaged 93.7 cents/lb during 2009-13. The ERS price spread calculations standardize the farm, wholesale, and retail product values over time, so the expanding wholesale-to-retail spread suggests rising costs in that segment of the supply chain, rather than changes in product mix or quality at each price point. In contrast, the farm-to-wholesale price spread has tended to decline slightly since 2000. These trends in price spreads may arise from differences in cost inflation in key inputs in the farm-to-wholesale and wholesale-to-retail segments of the supply chain, differences in productivity growth in each segment, and changes in the degree of market competition in each segment. This chart is based on data from the Meat Price Spreads data product.
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