The average price of a pound of ground beef reached a record high of $6.90 last month, marking a 19% increase from the previous year. This spike comes despite the United States being one of the world’s largest beef producers, second only to Brazil, according to a recent UN Food & Agriculture Organization report.
Shrinking cattle herds are a significant factor in the price surge. As of January, the U.S. cattle and calf population stood at 86.2 million, the lowest since 1951. Drought conditions and heatwaves, particularly in cattle-raising regions, have drastically reduced herd sizes. These challenges have been compounded by rising feed costs, partly due to reduced grassland availability and increased fertilizer prices linked to recent tariffs.
"Building a cattle herd is not like restocking a warehouse," noted a recent analysis by the American Farm Bureau Federation, predicting herd numbers may not recover until 2028.
Despite higher prices, U.S. beef consumption has remained stable, driven by insatiable demand. Research indicates beef is less price-sensitive than other proteins, with a USDA study showing a 10% price increase leads to only a 7% drop in demand. This dynamic tightens supply further, leaving American consumers facing sustained high prices at the meat counter.