Here’s what is keeping beef prices so high ahead – Business News
Beef prices aren’t easing anytime quickly and economists warn the stress may final for years.
That’s as a result of the US cattle herd has fallen to its smallest dimension in 75 years, after years of drought, rising feed prices and an getting old ranching workforce compelled producers to scale back.
“The biggest thing has been drought,” Eric Belasco, head of the agricultural economics division at Montana State University, informed Fox News Digital.
Years of dry climate have worn out grasslands throughout the West and Plains, leaving ranchers with out enough feed or water to maintain their herds. Many have been compelled to sell cattle early, together with breeding cows needed to supply the following technology of calves, making it tougher to rebuild.
Drought rapidly makes it tougher and more costly for ranchers to raise cattle.
As circumstances worsen, hay manufacturing falls, feed will get more costly and herd sizes shrink, in keeping with information from the Kansas City Federal Reserve.
But even when circumstances improve, rebuilding the herd takes time.
“The fact of the matter is there’s really nothing anybody can do to change this very quickly,” stated Derrell Peel, a professor of agricultural economics at Oklahoma State University. “We’re in a tight supply situation that took several years to develop, and it’ll take several years to get out of it.”
A herd of cattle seen in Campo, Colo. during a drought on May 8, 2026. Getty Images
Peel, who makes a speciality of livestock advertising and marketing, stated it takes roughly two years to deliver cattle to market, and several other more years to rebuild herds, leaving little room for short-term aid.
And the provision crunch is solely half of the story.
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The US beef industry is additionally extremely concentrated, with 4 main corporations—Tyson, JBS, Cargill and National Beef—processing about 85% of the nation’s grain-fed cattle.
That dominance has drawn scrutiny from regulators, together with a Department of Justice investigation into potential antitrust points and pricing practices within the meatpacking industry.
Steaks for sale at a grocery store in Chicago on April 29, 2026. AP
Critics argue that stage of consolidation offers meatpackers vital affect over prices, whereas industry teams say the market stays aggressive.
Higher prices haven’t scared off shoppers.
According to US Department of Agriculture information, the average price of beef climbed from about $8.70 per pound in March 2025 to $10.08 a 12 months later, an increase of roughly 16%.
Even so, demand has held up. In 2025, customers spent more than $45 billion on beef, shopping for more than 6.2 billion kilos, in keeping with information from Beef Research, a contractor for the National Cattlemen’s Beef Association.
Spending jumped about 12% from a 12 months earlier, whereas the quantity of beef offered rose more than 4%—a signal shoppers aren’t simply paying more, they’re shopping for more.
