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US beef prices hit record highs as cattle supply tightens
Beef prices are up 12% year over year, even though cattle ranchers say their costs have risen as fast as, or faster than, their returns.
US beef prices have surged to record highs, with prices in US supermarkets about 12% higher than a year earlier, a BBC Business investigation reports.
The outlet traces the increase through the American beef supply chain and finds the main driver is a lack of cattle. According to the report, the US had fewer cattle than at any point since 1951 after drought in many states and disease pressure reduced the herd earlier this year.
South Dakota rancher Eric Gropper, who has about 350 breeding cows, is seeing record prices at livestock auctions, with bids around $2,500 for a 600 lb calf, up from $2,000 two years ago. But he says profitability is not improving because his costs are also rising sharply.
BBC Business reports that drought has dried up groundwater on his land, forcing him to use a water tanker, while prices for inputs have jumped since the Covid pandemic. The story cites higher costs for equipment, fence materials, and feed, and notes that well over 60% of US cattle are grazing on drought-hit land, increasing demand for hay and other fodder.