The Times article noted that Cargill and other “big” suppliers of pre-packaged meat try to keep the price of the meat as low as possible. In this case, Cargill paid about $1 a pound for the beef,
or about 30 cents less than . . . it would cost for ground beef made from whole cuts of meat
and then sold it in a package of eighteen pre-formed, frozen beef patties (one-third of a pound each). I visited the Sam’s Club site to see if I could find that specific brand. I did not, but I found a similar item. (That’s how Sam’s Club works, by the way: What’s for sale at the store at any given moment is whatever they found that met the company’s price expectations, which means the brands change often.) By my calculations, the six pounds of meat in the package works out to $2.30 per pound. I buy ground beef at my local grocery store for the same price: typically $2.30 per pound. (Sometimes it’s on sale, but the normal price is about $2.30, depending on wholesale prices and market conditions.) The difference is that
- if I were to use it for burgers, I’d supply the labor to turn a lump of ground meat into burgers; and
- the beef is ground from the trimmings at the store where I buy it. None of it comes from Uruguay or wherever. (Yes, my grocery store’s meat comes from “factory farms,” presumably in the midwest.)
- And the meat is fresh, not frozen.
So --- why does the fresh meat I buy cost the same per pound as the supposedly “cheaper” meat that Cargill packaged and sold in convenient pre-formed patties? After all, Cargill spent $1 per pound for the original meat.
The other $1.30 cents is easily accounted for. First, Cargill needs to earn a profit. (Don’t EVEN bother to email me telling me that Cargill doesn’t deserve to earn a profit. Don’t bother.) (Oh, and before you get all bent out of shape about “greedy corporate America,” please take a look at your mutual fund holdings.)
Second, Cargill used equipment and labor to grind the meat and form it into patties. Third, and probably most expensive, Cargill paid someone to design the package, and paid for the plastic and cardboard in which the meat was wrapped. That last alone likely cost, what?, thirty cents per package? At least?
Next: The high cost of cheap and convenient.