What's causing record high US beef prices?
Summary
US beef prices have reached record highs mainly because there are fewer cattle available, mostly due to drought and disease. While ranchers get higher prices for their cattle, their costs for supplies and feed have also risen sharply, so they are not making much more profit than before.Key Facts
- US beef prices in supermarkets are 12% higher than a year ago, much faster than overall inflation.
- There are fewer cattle in the US now than at any time since 1951, caused by drought and disease.
- Rancher Eric Gropper sells calves at record prices but faces much higher costs for fuel, fence materials, feed, and equipment.
- Over 60% of US cattle graze on drought-affected land, forcing many farmers to buy extra feed like hay and silage.
- Most cattle are raised in large feedlots, where animals are fattened before slaughter; these feedlots also pay high prices for cattle.
- Four companies (Tyson, JBS, Cargill, National Beef) control about 85% of US beef processing, raising concerns about market concentration.
- Despite higher beef prices, increased costs mean ranchers and feedlot operators do not see significantly higher profits.
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