"Grilling Pork Belly Is Scary Now"... War Fallout Sparks Shaky Hands at Markets as Meat Prices Soar

With May, the month of family celebrations, approaching and outdoor activities on the rise, prices for livestock products-which are in high demand among families and acquaintances-continue to climb. Amid a general trend of high inflation, the outbreak of war in the Middle East sparked by U.S. and Israeli airstrikes on Iran has also driven up the prices of imported livestock products, which had previously helped stabilize the market. In response, the retail industry is diversifying sourcing regions, utilizing reserve inventories, and focusing efforts on defending prices to offset declining sales volumes.

Pork is displayed at a large supermarket in downtown Seoul. Photo by Yonhap News

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According to livestock distribution information from the Korea Institute for Animal Products Quality Evaluation on April 16, the retail price of domestic beef tenderloin (grade 1) rose by 4.7%-from 13,920 won per 100 grams on March 1, at the onset of the Middle East war, to 14,570 won on April 14. Compared to the same period last year, this is an 18.6% increase. The retail price of beef sirloin (grade 1) also climbed to 10,301 won, up 1.8% from early March and 11.8% higher than the previous year.

For pork, the retail prices of domestically produced pork belly and shoulder, which are in high demand, were recorded at 2,676 won and 2,480 won per 100 grams, respectively-about a 9% increase compared to early March. During the same period, the price of chicken (broiler) also rose by 4.8%, from 6,150 won to 6,445 won, and by 11.7% compared to the previous year.

Imported livestock product prices are also on the rise. The retail price of U.S. frozen short ribs (per 100 grams) increased by 15.3%, from 3,979 won in early March to 4,587 won. Prices for Australian chilled chuck eye roll (per 100 grams), commonly used for grilling, and frozen pork belly (per 100 grams) also saw slight increases, reaching 3,288 won and 1,499 won, respectively.

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Livestock product prices are likely to remain on an upward trajectory for the time being. According to KAMIS, the agricultural and fisheries distribution information system operated by Korea Agro-Fisheries & Food Trade Corporation (aT), only the wholesale price of Korean beef had dropped by 8.9% from the annual average to 16,024 won per kilogram as of April 14. Pork and chicken, on the other hand, saw increases of more than 20%, recording 6,185 won and 4,405 won, respectively.

A major reason for rising retail prices is the decline in the number of animals slaughtered at the production sites. According to the Korea Rural Economic Institute, the number of Korean cattle (Hanwoo) slaughtered this year is expected to be 862,000, down 9.1% from last year and 5.2% from the average year. For pork, as of February, the number of pigs slaughtered was tallied at 1.43 million, a 15.5% decrease from the same period last year. The number expected to be slaughtered in the first half of the year is at least 9.24 million, down 1.6% from a year earlier and 4.2% from two years ago. Additionally, the number of chickens to be slaughtered this month and next month is also expected to decrease by 1.3% and 4.6%, respectively, compared to the same periods last year.

Furthermore, rising exchange rates and logistics-related costs are fueling price increases for imported livestock products. In fact, the average price of animal feed for poultry and swine increased by 3.0%, from 597 won per kilogram in November last year to 615 won in February this year. During January and February of this year, the average import price of beef also surged by 7.2% year-on-year to 8.3 dollars per kilogram. These figures were recorded before the outbreak of the Middle East war, suggesting that the cost burden is likely to increase further in the future.

An industry insider stated, "At present, the war-related cost increases have not been fully reflected in the prices of imported livestock products distributed domestically, but there is ample room for import prices to rise further due to overall increases in feed and fuel costs."

Livestock products are displayed at a large supermarket in downtown Seoul. Photo by Yonhap News.

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This situation is making consumers hesitant to purchase livestock products. In fact, at Emart, overall livestock product sales rose by 14.7% and 8.9% month-on-month in January and February, respectively, but fell by 9.6% last month. Similarly, at Lotte Mart, livestock product sales increased by 10.8% and 18.8% month-on-month in January and February, but dropped by 10.2% last month. Even this decline was mitigated by enhanced discount benefits offered for the store’s anniversary.

These large supermarkets plan to respond to seasonal characteristics-such as increased camping and gatherings centered around family and friends-by ensuring that livestock consumption does not shrink. Emart intends to maximize the use of its reserve inventory to expand consumer choices, particularly for livestock products with steep price increases. Lotte Mart has increased its supply of Canadian beef, which is relatively cheaper than its U.S. counterpart, by more than 10% year-on-year, and has increased inventory of imported frozen meat, which has a longer shelf life, to ensure it can be used for more than six months in anticipation of price and supply volatility. From April 16 to 22, both beef and pork, as well as lamb and poultry, will be offered at up to 50% off through event cards and membership promotions.

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