This Christmas, Consider a Festive Rack of Ribs
(Bloomberg) – If you want to avoid the inflation crisis, forget ham and turkey this Christmas. Grab the ribs instead.
Turkey has been hit by its worst-ever bird flu outbreak, limiting supply and sending prices soaring during the year-end holidays. It has also helped drive up the price of ham, the other traditional holiday protein, as shoppers look for alternatives. Meanwhile, cuts of pork that don’t require as much processing, such as B. Ribs, experienced a plentiful supply and falling prices. Chicken prices, which had been higher in recent years, also started to cool down.
Companies like Baldor Specialty Foods are preparing for sticker shock. The supplier to restaurants and grocery stores is promoting customers for the first time whole chickens for holiday meals, in part because ham prices are up 15% from last year. It also advertises a 10-bone pork rack as a less expensive option.
“We’ve tried to get creative with what we can offer, which is a lower price per pound,” said Kevin Lindgren, Baldor’s Director of Merchandising. “The processing and the product just got significantly more expensive,” he added, noting that spiral ham requires extra labor for smoking, curing and slicing. “Especially since August, we’ve seen it increase quite significantly.”
According to data released Tuesday by the US Department of Labor, ham prices rose for the fourth straight month in November, rising 7.8% year-on-year. Prices for the poultry category, which includes turkey, rose almost 18%. The recent increases come on top of higher protein costs across the board during the pandemic, as high feed costs and labor shortages across the supply chain are driving prices higher. And while core inflation is slowing, food inflation appears to be holding up.
US Foods Holding Corp., a restaurant supplier, said limited capacity and economic challenges have led to higher ham prices. In an email, the Rosemont, Illinois-based company said it offers its customers “low-cost alternatives” and is working “very closely with our suppliers and operators to mitigate cost increases and ensure supply.”
At Famous Dave’s, a grill chain with about 120 locations across the US, ham costs are up about 25% year over year. The company offers holiday dishes like whole hickory-smoked turkeys and double-smoked ham that retail for $89 individually or $159 as a bundle that includes mashed potatoes, mac and cheese, and cornbread muffins. The company says prices are about 20% higher than last year.
Consumers are “feeling the impact” of inflation when they shop, said Al Hank, co-chief operating officer of BBQ Holdings, the chain’s parent company. He predicted some will skip meals for the winter holidays. “Maybe they don’t choose to get the full package,” he said. “They will supplement and make their own mashed potatoes.”
For its appetizers, Famous Dave’s is introducing less meaty options like grilled cheese sandwiches at some locations. The goal is to make up for lost margins from higher protein costs while keeping menu prices reasonable for guests.
A low supply also contributes to higher prices. Bacon inventories in US cold stores in October were the lowest for the month since 2006. And pork production also fell 3.2% in the year ended Dec. 10, according to the US Department of Agriculture.
“We just have less pork production overall,” said Holly Cook, economist at the National Pork Producers Council. “Labor is part of that, and we have fewer pigs in the US right now than we did before.”
At the same time, the US sent 9% more ham to Mexico. That’s an estimated one-fifth of the total U.S. ham supply that crosses the border, said Bob Brown, an independent livestock and meat market consultant in Edmond, Oklahoma.
“The cost of spiral ham is skyrocketing,” said Tony Sarsam, CEO of SpartanNash Co., a grocery retailer and distributor. “We’re seeing pretty significant inflation there.”
Supply in Turkey is also low – many have been taken out of cold storage as avian flu kills millions of birds. Some of the recent outbreaks have occurred on turkey farms in South Dakota and Iowa, further limiting availability.
According to Chris DuBois, protein practice leader at IRI, retailers are still offering some discounts on center-of-plate proteins like ham and turkey to lure shoppers. That means consumers should be able to find some relative bargains, especially when shopping this coming weekend. “Price declines will not be as generous throughout the period,” DuBois said over the phone.
Margaret Akbar, 73, said she was closely following the sale of a ham she plans to buy at nearby grocer Mariano for Christmas this year. “I kind of have to watch my money,” said the retired nurse, who lives in Chicago.
In addition to the more expensive hams, Akbar says the sausages and sliced deli ham that she regularly picks up for her grandson have gone up in price. That forced her to cut those purchases by about half, she said. “Prices have gone up”
Melissa Cookston, a chef who sells her Memphis-style barbecue ribs and pulled pork on the Goldbelly Food website, raised the price of her holiday hams this year. You’ll go for about $150 for a double-smoked spiral ham (shipping included), a 50% jump from 2021.
“Traditional holiday proteins are consistently more expensive and are impacted by a range of supply chain issues and inflationary pressures,” she said in an email, noting that her hams are “no exception.”
(Added a quote from the CEO of SpartanNash Co.)
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