Volume 10: Economic Impact and International Trade
4. Where did the economic consequences of BSE finally fall?
Consumers

4.7 Perhaps the most significant of these other factors was the diminishing demand for beef. As Figure 4.1 below shows, per capita consumption of beef declined steadily throughout the period under examination, although it is impossible to determine to what extent BSE contributed to this decline. Likewise the retail price for beef, when measured in real prices rather than cash prices, ¹ declined during the period. As Figure 4.2 below shows, beef prices, expressed in cash terms, increased more slowly than the Retail Price Index (RPI) for all items.

Figure 4.1: UK beef consumption per head, 1986-97

Figure 4.2: The RPI for beef, food and all items, 1987-97

4.8 Since the decline in demand for beef cannot be assuredly attributed, in whole or part, to BSE, neither can the relative decline in retail beef prices be credited to it. However, it does appear that we can safely conclude that the increased costs associated with BSE in the beef and cattle industry were not passed on to consumers.

4.9 Having concluded that consumers did not absorb the increased costs of production due to BSE, these costs must have been absorbed by one or more of the commercial actors in the chain of production.