Rabobank, a premier global food and agribusiness bank founded 125 years ago and a leading financier of the energy transition, released the annual BBQ Index ahead of grilling season. The basic premise of the BBQ Index is to determine the cost of a BBQ for ten people ahead of the summer grilling season.
Rabobank’s senior beef analyst, Lance Zimmerman, talked in depth with Oklahoma Farm Report’s Ron Hays about the BBQ Index, assembled and worked on by a team of food and ag analysts at Rabobank. The team assumes each person will consume one cheeseburger with lettuce and tomato, one chicken sandwich with lettuce, tomato, and a slice of cheese, two handfuls of chips, two beers, a soda, and a few scoops of ice cream. As a means of comparison, the BBQ Index parallels the Bureau of Labor Statistics as a data source. The team selected the monthly data series “average price index, U.S. city average.”
As we pool all of those items together, it is looking like this year that grocery basket of goods will have basically a four percent year-over-year increase compared to last year, so stronger than what generic inflation would be, or headline inflation, as they often say,” Zimmerman reported.
Hays pointed out that chicken increased by a higher percentage than ground beef, and Zimmerman pointed to the rebounding demand for chicken breasts in food service. “There is a massive focus on value, especially among quick service restaurant chains today,” he said. “As they look at trying to find ways to minimize price pressure on consumers, food service is chasing white meat chicken breasts hard, and as a result, it is leaving retail grocery stores in a little bit of a scramble mode so that they have to increase prices.”
Despite the 4% price increase, Zimmerman doesn’t anticipate that it will slow down the summer BBQ season at all. “Beef is that celebratory protein,” he explained. “It is that item that takes the center of the plate when we are celebrating special occasions, which is what grilling season is all about.”
He described how the cost of upgrading food choices is one of the cheapest premiums to pay in terms of added value for the additional dollar. According to Zimmerman, this is certainly the case with beef. He detailed, “Beef has been a beneficiary of that when we look at how strong demand has been, not just recently, but really the gross trend that we’ve seen over the last three decades.”
May is beef month, so the timing of the BBQ Index is prudent, and the strength in cattle markets is partially the result of exalted beef demand, but also due to tightened supplies.
“When we look at ground beef in particular, it went through some massive month-over-month price increases in the first quarter,” Zimmerman noted. He expects ground beef prices to rise much more slowly in the coming months.
Over the last several years, various beef reports show that ground beef makes up between 55% and 60% of total beef consumption. This is significant because in the 1980s and 90s, it was considered a salvage product to add value to tougher cuts of meat and to the cull cow and bull industry; however, increasingly over the last decade, the ground beef category has experienced premiumization due to its wide use across the industry.
“Texans listening today are probably crying because you even see premium grinds using ground brisket in their formulations in USDA Prime Grind; that would have never been imagined ten or fifteen years ago,” Zimmerman stated. “It tells you how far we’ve come as an industry where even grinds are considered a premium offering.”
Digest more of the Rabobank 2025 BBQ Index featuring dairy, poultry, baking, and produce here.
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