Yesterday, Newsweek published one of several possible takes on the short-term and long-term rise in beef prices and with particularity ground beef prices.
Here are some bullet points from the article:
– “Ground beef prices across the U.S. continue to reach new highs, driven by shrinking cattle herds, with looming import restrictions threatening to push costs even higher.”
– Bureau of Labor Statistics June 2025 CPI data for beef products have steak prices up 12.4% over June 2024, followed by ground beef prices rising at 10.3% year-over-year, followed by a 3.9% price increase for chicken, and 0.5% growth in prices for pork. As an aside, I have commented on the drop in demand from China for American pork products, after that nation imposed a tariff on American pork products in retaliation for the initial imposition of American tariffs on a wide variety of Chinese goods. It makes sense that the CPI rise in pork products would be less than that for other meats, as international demand for pork has lessened and domestic demand for pork has remained stable. Less demand, same supply, less pressure in price increases.
– BLS CPI data also reveals that the price for ground beef hit $6.12 per pound in June, up from $5.98 per pound in May, and up from $5.47 per pound from June 2024. According to the reporter, experts say there may be” upward pressure on ground beef prices through 2026 and beyond.” As an aside, as I am unaware of any pricing category for “100% ground beef”, I suspect this is a clerical error, and the number should be 73% ground beef.
– According to agricultural economist Derrell Peel, “[i]t might be at least two or three years before we see any significant change on the supply side that would ultimately lead to some moderation in beef prices.”
– On January 1, 2025, the U.S. herd count was 86.7 million cattle and calves, the lowest since 1951.
– Drought conditions since 2020, elevated grain prices, inflation and rising interest rates mean ranching costs have risen in recent years, prompting ranchers to trim herd sizes.
– “Leaner supply” has cattle selling for $200 per 100 pounds and calves selling for $400 per hundred pounds, which price levels, per a Texas A&M livestock economist, David Anderson, means it is more profitable for ranchers to sell their cattle and calves early instead of keeping them for breeding.
Anderson went on to tell the reporter:
“Once you get to a situation like this, where we don’t have enough inventory to maintain production, the only way to fix it is to actually make that tight supply even tighter. … Because in the cattle industry, they only have one offspring at a time. They only have one calf at a time. And if that calf is a heifer, and you want to use her for breeding to rebuild the herd, then you have to not use her for beef production in the short run.”
– Impending tariffs on imported beef from countries as far away as Australia and New Zealand may raise beef prices even further. Canada and Mexico, nations that send cattle into the U.S. beef marketplace, already have tariffs in place. Brazil, another major beef exporter to the U.S., has been threatened with a 50% tariff on all products.
– A spreading screwworm infestation in cattle from Central America has reached Mexico, which infestation prompted a recent suspension of all imports of cattle from Mexico.
Make of this what you will.
Me?
I have been commenting about tightening beef supply for years. Most of the news is negative, re: rising prices for consumers at the grocery display case. None of the rise in beef prices comes from any one administration’s policies, Biden or Trump.
Some FlaglerLive commenters will blame former President Biden for today’s beef prices, saying inflation is at fault. They would be barely right and significantly wrong, but that won’t stop them.
Some FlaglerLive commenters will blame President Trump for today’s beef prices, saying tariffs are at fault. They would be barely right and significantly wrong, but that won’t stop them either.
It is a multitude of factors that provides the most accurate assessment of today’s rising beef prices. Drought spread over the past five years limited grazing as a source of food. Drought spread over the past five years limited the availability of feed, as grain yield dropped significantly during those years. Facing rising feed costs, ranchers took the only reasonable choice which was to sell off herds before they reached maturity. Year after year, they sold off herds early and now the total head county is the lowest since 1951.
