Economists indicate that beef prices won’t decrease anytime soon, with pressures potentially persisting for several years.
The U.S. cattle herd has reached its smallest level in 75 years, largely due to ongoing drought conditions, increased feed costs, and an aging workforce in ranching, prompting many producers to reduce their herds.
According to Eric Velasco, an agricultural economics dean at Montana State University, “The primary issue is indeed the drought.”
Prolonged dry spells have devastated grasslands throughout the West and Plains regions, leaving ranchers struggling to provide adequate forage and water for their cattle. Many breeding cows, essential for calf production, have been sold prematurely, complicating herd recovery efforts.
Drought significantly raises the cost of cattle rearing for ranchers, creating a difficult environment.
Data suggests that worsening conditions lead to a decline in hay production, increased feed prices, and reduced herd sizes.
Even if there are improvements in conditions, rebuilding the herd is a slow process.
Derrell Peele, a professor of agricultural economics at Oklahoma State University, stated, “The fact is, there’s no quick fix. We’re facing a tight supply situation, developed over years, and it will take years to resolve.”
Peele, who focuses on livestock marketing, emphasizes that finding short-term relief is unlikely, noting it requires about two years to bring a cow to market and several more to rebuild a herd.
Moreover, supply shortages are only part of the story.
The U.S. beef industry is highly concentrated: the four largest companies—Tyson, JBS, Cargill, and National Beef—process approximately 85% of the nation’s grain-fed beef.
This level of consolidation has raised red flags among regulators, prompting investigations by the Justice Department into potential antitrust issues and pricing practices in the meat packaging sector.
Some critics argue that this consolidation allows meat processors to exert undue influence over prices, while industry representatives maintain that competition is robust.
Despite rising prices, consumers haven’t been deterred.
Data from the U.S. Department of Agriculture reveals that the average price of beef jumped from about $8.70 per pound in March 2025 to $10.08 a year later, a rise of roughly 16%.
Nonetheless, demand continues to soar. In 2025, consumers spent over $45 billion on beef, purchasing upwards of 6.2 billion pounds, as per information from Beef Research, affiliated with the National Cattle and Beef Association.
This reflects a year-over-year spending increase of approximately 12%, while beef sales rose by more than 4%. It seems consumers are not just paying more; they’re also purchasing more.
