FURTHER signs are emerging that high US beef prices are pushing consumers toward other proteins as inflationary pressures tighten household budgets.

With beef prices near record levels, trade insiders in recent weeks have reported growing pushback from some US consumers, driven by rising food, inflation and broader cost-of-living pressures.

Reinforcing that trend, McDonald’s CEO Chris Kempczinski last week said the company would increase its emphasis on chicken products as consumers turn away from more expensive beef options.

“Certainly right now in the environment that we’re in, I think chicken is benefiting relative to beef, due to their respective costs,” he said during a first-quarter earnings call last week.

Mr Kempczinski said McDonald’s market share for fast-food chicken sat in the high teens, compared with roughly a “mid-40 percent share” for beef.

In its outlook for the year ahead, McDonald’s noted that value meals were “bringing customers back”, with both high-income and lower-income consumers becoming more budget-conscious as prices for fuel and everyday essentials increased.

MarketWatch reported that beef prices remain near record highs, with US Government data showing the average price of ground beef in US cities hovered around US$6.70/lb in March.

The US Department of Justice also last week confirmed it was investigating potential antitrust violations in the US cattle and beef industries, including whether corporate consolidation was contributing to record-high prices alongside factors such as drought, tariffs, lower cattle supplies and fewer processing plants.

Last week, fast-casual burger chain Shake Shack also cited the impact of rising beef prices after posting its first quarterly loss in three years.

Elders market analyst Richard Koch also reported signs that robust US beef demand may be waning under the weight of higher fuel costs.

Major US food company Tyson Foods said in its latest quarterly results that rising chicken sales helped offset a sharp decline in demand for high-priced beef.

Protein-hungry but cash-strapped consumers had shifted toward more affordable meats such as chicken and pork, while Tyson reported beef prices climbed 11.5pc during the quarter even as sales volumes fell 13.1pc. The company’s beef division is now forecasting a US$500 million loss this year.

US media outlet Inc. has also reported that McDonald’s is “betting big on chicken” across its 45,000 global stores.

“McDonald’s, the fast food chain that got America hooked on hamburgers, is looking beyond its beef-heavy menu and betting big on chicken,” the publication noted, adding the company is pushing wings, tenders, nuggets and sandwiches in both the United States and international markets.

“To get customers excited to order chicken, McDonald’s started rolling out new sauces for its McNuggets and McStrips over the past year, including Hot Honey, which hit menus in January.

“Last month, as part of the launch of its lower-priced McValue menu, McDonald’s introduced an even cheaper chicken option with the $5 McChicken.”

Mr Kempczinski said the strategy reflected the company’s focus on expanding growth opportunities in chicken, explaining during the first-quarter earnings call that McDonald’s sees significant room to scale in the category.

“The chicken category is bigger than beef globally, and it’s growing two times faster,” Kempczinski told investors on the call.

“There’s certainly a lot of activity happening in chicken across the industry. For us, it’s going to continue to be a point of focus and a point of priority.”

Analysts noted that McDonald’s value-focused strategy – a response to perceptions that its food had become too expensive relative to competitors – appears to be working.

The company recorded US$6.52 billion in net revenue for the first quarter, a 9pc increase that surpassed market expectations and included a 3.8pc rise in global comparable sales.

“McDonald’s value leadership is working,” Mr Kempczinski told US media earlier this year. “By listening to customers and taking action, we have improved traffic and strengthened our value and affordability scores.”