Cattle may be netting record prices, but cattlemen aren't seeing huge profits and retailers are feeling squeezed, industry experts say.
Cattlemen say skyrocketing feed and fuel costs are eating into profits, and retailers are apprehensive about passing all price increases on to consumers during a still struggling economy.
Meanwhile, beef production is at a 65-year low amid increasing demand from export markets that saw beef prices climb to record highs during the first half of the year.
Competitive markets overseas coupled with a weak U.S. dollar mean consumers can expect beef prices in the grocery to eventually catch up.
"Folks are only going to run on a loss for so long, which makes it very interesting," said Jack Field, executive vice president of the Washington Cattlemen's Association in Ellensburg. "You've got to make your markup for your operation and keep things going."
But it's not clear just when that will happen.
Wrays Food and Drug owner Chris Brown said he only has passed on about half of the roughly 15 percent increase he has seen in beef over the past few months.
He said he has trying to make up the loss with other products in his grocery store, something tough to accomplish when his own cost to buy from wholesalers on overall store inventory has climbed about 5 percent to 6 percent this year.
"It's all about mix, so you just squish it up somewhere else," he said. "You can't raise (prices on) everything as high as you need to."
Prime Cut Meats & Deli owner Greg Palachuck said traffic at his West Valley shop has dropped off by about 60 percent since prices shot up about 20 percent to 30 percent on prime rib, his specialty.
He said he's relying on other cuts of meat to offset the drop in sales.
"I was actually surprised when I called for prices -- everything is out of control," he said. "By the time you pay for your butcher, and paper and wrapping, you're about breaking even."
Washington Beef in Toppenish is paying anywhere from $300 to $500 more per head, a cost they are reluctant to pass on to retailers, said Brad McDowell, president of Boise-based AB Foods, which owns the Toppenish slaughterhouse.
He said just a few years ago his company was paying anywhere from 85 cents to 95 cents a pound compared to today's average price of $1.25 a pound.
"It's becoming tough," he said. "We have been paying prices in cattle that we have never seen before in history."