Any way you slice it, U.S. beef demand has been on the upswing in recent years. Though the quantity of beef available to consumers has been on an annual decline for the majority of the past decade, the fact that beef and cattle prices have risen as they have relative to 10 years ago points to a strong willingness of consumers to pay up for the beef that is available.

This phenomenon has not just been confined to the beef industry, as consumer expenditures on pork and chicken have been on the rise as well. A couple of different data series underscore this fact. The Bureau of Labor Statistics (BLS) Consumer Expenditure survey finds that consumer spending on beef, pork and poultry products rose for the fourth consecutive year in 2014 to a level 15% above 2010. Examining the quantities of meat passing through the retail marketplace times their respective retail prices as reported by USDA’s Economic Research Service (ERS) yields similar results. In 2015, this calculation placed meat expenditures 28% higher than in 2010.

Beef captures its market share

Beef has been holding its own as a share of total beef, pork and chicken expenditures according to the ERS data. The percentage of expenditures made for beef has remained between 47% and 49% each year since 2003. For pork, the range has been between 25% and 28%, with chicken between 24% and 27%.

The BLS survey data shows a similar story, though slight differences do exist. Beef expenditures account for 40% of the total in 2014, down from an average of 43% in the previous decade. Pork came in at 30 %, unchanged from the 2000-2009 average. Poultry picked up the expenditure share lost by beef, going from 27% over the 2000-2009 period to 30% last year.

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It may be surprising to many that beef has held a rather steady share of meat expenditures, despite the fact that its share of retail weight quantity consumed has steadily fallen from 36% in 1996 to about 28% in 2015. It speaks to the fact that the average annual retail price for one pound of beef, which only outpaced the cost of one pound of pork at retail by 34 cents as recently as 1998, surpassed pork retail prices by $2.45 per pound in 2015. Beef retail prices exceeded the chicken retail price by a whopping $4.33 per pound last year. At these price levels, a consumer could purchase over 3 pounds of chicken for each pound of beef purchased. Beef demand must remain strong at these relative meat price levels.

Consumers crave quality beef

So what does this information tell us? The consumer appetite for the beef supply that has been available in recent years has been strong enough to demand a high premium over that for pork and poultry. As the amount of beef available to U.S. consumers is expected to grow for the next few years, prices for beef and cattle at all levels of the marketing chain are likely to decline. However, the extent of the decline will depend largely upon the ability of the marketplace to absorb additional supplies without severely undercutting price. Signs began to appear in late 2015 that the annual growth in consumer expenditures for meat has slowed considerably and that some contraction could take place in 2016.

As the beef industry enters a window of time in which available supplies are projected to increase, and consumer willingness to spend on meat could very well be challenged, it is vital that the earned reputation of beef as a consistent and quality product remain at the forefront of consumer thinking. It remains important to conduct research that ensures the beef products available to consumers are of the highest quality and meet expectations. If a weaker beef demand story were to play out over the next ten years similar to the late 1980s and early 1990s, cattle producers across the country will be disappointed in the prices they will receive for their cattle.

The competition for the center of the plate is going to intensify as all meat supplies increase in 2016. Beyond that, there are always a myriad of food and non-food choices competing for the pocket book of the American public, and protecting the premium pricing that beef has garnered over other meats in recent years will provide a needed boost to all players in the beef industry in the next few years to come.

Brown is a livestock economist with the University of Missouri. He grew up on a diversified farm in northwest Missouri.