Overview
- U.S. cattle inventories are at their lowest in 75 years, and ranchers have reduced herds after drought, wildfires and higher feed and transport costs cut carrying capacity and raised production costs.
- Retail beef prices have climbed to near-record levels, with Bureau of Labor Statistics data showing lean and extra-lean ground beef averaged $8.62 per pound in May.
- Shoppers are reacting by buying cheaper cuts and lower grades, substituting chicken or pork, and some local retailers are selling budget grill packs to stretch holiday food budgets.
- President Trump has pushed for low-tariff Argentine beef imports and directed the Department of Justice to investigate whether meatpackers have inflated prices, while U.S. restrictions on Mexican cattle remain in place because of the New World screwworm.
- Herd recovery is slow because producers must keep heifers for breeding, a process that delays added beef supply by roughly two years, so prices are likely to stay high in the near term and keep pressuring household grocery bills.