SACRAMENTO (CBS13) — Rising beef prices are forcing restaurants to choose between raising prices, or chopping items from menus.

A drought in the central United States has reduced hay production, cattle’s main meal. With less to feed them, ranchers are cutting back, too. Cattle production is down to a level not seen since the 1950s.

Taylor’s Market butcher Danny Johnson says this combination is driving all beef prices upward.

“I’ve seen spikes and it comes back down but this has been pretty steady,” he said. “There is always a rise during barbecue season, but this year was more significant. And even all the grind meats, the shoulder meats—all that stuff is going up too.”

Across the country, Costco and Chipotle have already raised their prices, and local stores like Taylor’s Market in Land Park have followed.

Johnson says his meats are 60 cents a pound higher than they were last winter.

But customers we spoke to aren’t ready to give up on buying steak yet.

“It hasn’t necessarily driven us there,” said Darren Bouten. “We don’t necessarily eat a lot of beef anyway so when we do eat it I don’t worry about price points.”

But some restaurants worry sales will drop soon if prices keep going up. Club Pheasant co-owner Patti Palamidessi says she tries to keep prices steady at the West Sacramento restaurant known for its steak sandwich.

“That is our main goal: good for us to carry on with business but comfortable for the customers to be here,” she said.

According to the U.S. Department of Agriculture, restaurants and markets are on average paying 11 percent more for the same cuts of meat than they were a year ago at this time. Shoppers shouldn’t expect many changes for at least a year.

But if the drought continues into next year, butchers and restaurant owners expect prices to go even higher. At that point, many of them say they will be forced to cut back on the beef cuts they sell, or get rid of the dishes.


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