scmrph t1_j30iw9b wrote

Yes and no, in terms of a direct demand side shock effect you are partially right, there is not a 1 to 1 reduction of consumption, but any reduction in demand will equate to a reduction in both price and net consumption, say a 50% reduction in demand leading to a 15% reduction in price and 15% reduciton in total volume consumed (numbers depend on price elasticity and shape of the supply curve)

In the long term though there is profitability to consider, sufficient reduction in demand leads to reduced profit margins (due to decreased price). This will cause suppliers to reduce production/drop out of market until marginal cost=marginal gain again. Depending on the impact of economies to scale on the production side this can drive the price back up to anywhere from somewhat below the original price to wildly above it. Either way with the rebound in price as the supply curve adjusts itself downwards to handle the new reality there will be further reductions in total volume consumed.

I dont really have a side in this debate, I eat meat but food price going down is not a bad thing and even if the meat economies collapse that will redirect fertile land production towards other crops (meat is terribly inefficient land & water-use wise, especially after considering land used to grow feed), but economics doesnt at all dictate a fixed consumption rate, reduced demand will pretty much always lead to *some* reduction in volume consumed. This holds true for any product from oil to diamonds to diapers.