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Source: by David Widmar, Agricultural Economic Insights (AEI)

During the height of uncertainty about the pandemic and economic shutdown, the U.S. meat sector found itself in the middle of several COVID-related disruptions.

On the demand side, consumers rushed to the grocery stores, initially emptying the shelves, while restaurant activity slumped and summer BBQs were in limbo. However, the supply-side challenges proved to be even more challenging throughout the spring and summer.

With some of the uncertainty settling, this week's post steps back to review U.S. meat consumption trends and the forecasts for 2020 and 2021.

U.S. Meat Consumption, 1970 - 2020
Throughout this post, we discuss per capita meat consumption. It is important to note the USDA reports these data as per capita meat disappearance. This measure is the residual of production, beginning and ending inventories, import, and export data.

In other words, the USDA does not explicitly measure consumption but offers a proxy measure that is essentially consumption. When discussing consumption, we are truly reporting the USDA's measure of meat disappearances. Furthermore, a decrease (or increase) in consumption is not a change in demand.

Figure 1 shows the per capita consumption of total red meat and poultry since 1970. After peaking at nearly 222 pounds in 2017, total meat consumption began to slump during the Great Recession and eventually hit a low of 202 pounds in 2014. Beginning in 2015, meat consumption trended higher and is forecasted at 225 pounds in 2020. Looking ahead, total consumption is expected to slump slightly into 2021 (224.8 in 2021 compared to 225.1 in 2020).

Figure 1. Per Capita U.S. Total Red Meat and Poultry Consumption, 1970 2021f. Data Sources: USDA ERS and WASDE.

U.S. Beef Consumption - A Long Decline, With A Recent Upturn
Beyond the total consumption trends, it's important to recognize each meat has its own set of opportunities, challenges, and trends. Figure 2 shows U.S. beef consumption, which has been a long story of decline.

In the 1970s and early 1980s, per capita consumption was around 80 lbs. Consumption slipped but stayed around 65 pounds throughout the 1990s and early 2000s. After the Great Recession, consumption slipped, again, to a low of 54 pounds.

For 2020, consumption was more than 58 pounds. On the one hand, the upturn since 2015 is significant and noteworthy. However, the reality is that beef consumption remains well below 65 pounds per capita, which was last observed in 2007.

For 2021, consumption is estimated to be slightly lower than in 2020, down 0.4 pounds per capita year over year.

Figure 2. Per Capita U.S. Beef Consumption, 1970 2021f. Data Sources: USDA ERS and WASDE.

U.S. Pork Consumption - Mostly Flat
Overall, pork consumption has been mostly flat at 50 pounds per capita over the last fifty years (Figure 3). At 52 pounds in 2020, forecasted consumption is expected to increase 0.5 pounds in 2021. Pork consumption has not been above 52 pounds per capita since 1999. Furthermore, consumption is considerably above the 2011 lows of 45.7 pounds.

Figure 3. Per Capita U.S. Pork Consumption, 1970 2021f. Data Sources: USDA ERS and WASDE.

U.S. Poultry Consumption - A Dramatic Increase
The decades-long trend toward more poultry consumption is well known. At less than 50 pounds in the early 1970s, poultry consumption is forecasted at 113 pounds in 2021. Broadly speaking, the trend is dramatically different from declining per capita consumption in beef and stable consumption of pork.

In the 1970s, poultry accounted for less than 25% of the total U.S. meat consumption. Since 2014, however, poultry has accounted for a majority.

Figure 4. Per Capita U.S. Total Poultry Consumption, 1970 2018f. Data Sources: USDA ERS and WASDE.

Wrapping it Up - Meat Consumption After the Pandemic
Three primary observations are worth keeping in mind. First, U.S. consumption varies significantly depending on the type of meat. While total consumption is increasing, it has been largely driven by an increase in poultry consumption to offset the decline in beef and holding pattern for pork. Of course, these data don't reflect changes in overall consumer demand or total consumption. In 1970, the U.S. had an estimated population of 205 million, compared to 331 million in 2020.

Second, given all the turmoil and uncertainty in 2020, meat consumption has been fairly steady and looks to remain so in 2021. For all three categories, consumption in 2021 is currently forecasted to be within 0.1 pounds of 2019 levels. This was not the case during the Great Recession when beef (-4.2 pounds per capita) and poultry (-5.9 pounds per capita) contracted sharply from 2007 to 2009. These forecasts will be important to monitor in the coming months.

Finally, one lesson to keep in mind from the Great Recession is the duration and magnitude of adjustments. Thinking about the current reality, one must wonder if the impacts of COVID and 2020 will also linger for years to come.

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