Beef producers gaining from low-carb demand
By Lynn Brezosky
Associated Press
KINGSVILLE, Texas — Until recently, a lanky Texan like Paul Genho had little interest in celebrity doctors and their diet trends. But thanks to the toppled food pyramid advised by gurus such as Dr. Atkins and Dr. Agatson, red meat sales are up again.
"Beef is hot. Beef is back," said Genho, manager of the 825,000-acre King Ranch, one of the country's top beef producers. "People are sick of chicken."
Breed bulls are going for $40,000, and live cattle prices were recently trading at more than $1 a pound .
"Eighty cents is considered healthy," Genho said, noting that prices were in the 50-cent range a few years ago.
Diets can't take all the credit for the increase. A mad-cow disease scare closed off the Canadian supply, so steak distributors worldwide turned to the U.S. market, where there were no reports of the sickness. The two countries are the major suppliers of grain-fed beef, which consumers prefer to grass-fed beef. Droughts around the United States also have thinned cattle herds, so supply is down.
"But that gets you (an additional) 2 or 3 or 4 cents on the pound; that doesn't get you 20 or 30 or 40," said Gregg Doud, chief economist for the National Cattlemen's Beef Association. "That comes from predominantly domestic demand. That's steak orders from restaurants."
The diets' effect on prices can't be understated, said Ann Barnhardt, an analyst with the livestock research firm Hedgersedge .com. "I credit a lot of that to the Atkins diet," she said.
Sales are soaring for books such as "Atkins for Life" and "The South Beach Diet," which reverse decades of dietary advice by saying the way to lose weight is to cut carbohydrates in favor of protein, including red meat. Many say they've lost weight quickly on the diets.
But people would be back to beef without the dietary license, said trend analyst Gerald Celente. He said people are tired of depriving themselves after two years of a weak economy and worries about terrorism."Beef is also a comfort food," Celente said.
Dr. George Blackburn of Harvard Medical School cautioned that the typical low-carb weight loss of 10 percent happened only when people followed the diet, which many people give up. Long-term, he said, people are going to need to be taught to reincorporate carbohydrates without gaining back all the weight.
"All roads to Rome come back to a balanced diet," he said.
That's not what ranchers want to hear, but many are realistic about the ups and downs of their industry.
"They're paying everything off, preparing for the future," Genho said.
