Will's Wisdom: Why is the Price of Beef on the Rise?

Posted by Will Harris
Mar 6, 2024 1:07:26 PM


Beef prices are higher than I've ever seen them. There are reasons for that.

The number of reproductive beef cattle that live on farms in the USA varies in a cycle of about 8 to 12 years from low point to low point. It is odd, but it has always been true. Here is what the inventory of momma cows has looked like in the usa over the last 100 years:

This variance is influenced by:
  • Cattle prices and input costs that drive cow-calf producer profitability.
  •  The gestation period for cattle.
  • The time needed for raising calves to market weight.
  • Climate conditions.
As you would expect, when the supply of cattle is high, the demand is less and the price of those live cattle goes down. Also, as one would expect, when the supply of cattle is low, the demand is great and the price is high.

The inventory of cattle is now lower than it has been since the 1950's. The lowest in almost 70 years! And, the number of companies buying live calves is lower than it ever has been in history. [Four multinational companies are producing over 80 percent of the calves produced.]

Cattle farmers' average age is well over 60 years of age, and they have not been very profitable for many years. We simply don't know how this will evolve.

Despite the low national inventory of cattle, our farm is focused on the long-term vision, which includes beef, but also pork, lamb, chicken, and other meats to offer our consumers.

Hold on. None of us are enjoying this much.

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