CHICAGO Nov 13 Eli Lilly & Co.'s Elanco Animal
Health unit will raise the price of its beta-agonist feed
supplements by 2 to 3 percent on Nov. 26 amid strong demand from
beef feedlots, a company spokeswoman told Reuters on Wednesday.
The price increase - which the company said will apply to
all of Eli Lilly's products for cattle, hogs and other
food animals - comes amid strong demand for its Optaflexx
ractopamine-based feed additive for cattle, which helps bulk up
the amount of meat on a beef carcass prior to slaughter.
The move is part of a review of its agricultural product
pricing, market conditions and production costs that Elanco
regularly conducts for all products, said company spokeswoman
Colleen Parr Dekker. The price increase, though, will not apply
to newer non-betagonist products released in 2012 or this year,
Sales of Elanco's cattle feed additive Optaflexx in the
United States began surging in late August, after rival Merck &
Co. announced its decision to temporarily suspend sales
of its Zilmax beta-agonist additive. Merck's announcement came
after meat processor Tyson Foods said it would stop buying
Zilmax-fed cattle amid concerns the livestock drug was
potentially causing health problems for some cattle.
Elanco's price increase will likely not have much of an
impact on meat producers, nor cool demand for the drug-maker's
beta-agonist feed products - particularly among cattle feedlot
owners. Retail beef prices remain at record highs, while the
nation's cattle herd is the lowest level in more than 60 years.
Elanco "is clearly taking advantage of the lack of
competition" for beta-agonists," said Jim Robb, director of the
Livestock Marketing Information Center in Denver, Colorado.