A panel of leading cattle market economists expects historically strong US cattle prices to persist for several years, despite political pressure over beef inflation and packers operating with sustained negative margins. Speaking at the Missouri Governor’s Conference on Agriculture, experts from Oklahoma State University, Rabo AgriFinance and the University of Missouri agreed that the tightest cattle supplies are still ahead, while demand remains exceptionally strong.
Derrell Peel noted that current price levels are justified by fundamentals rather than speculation. Lance Zimmerman highlighted that while the U.S. cow herd has been declining since 2019, per capita beef supplies have remained stable at 58–59 lb. for six consecutive years, meaning record-high prices are largely demand-driven.
The panel emphasized that the industry has not yet reached the tightest point of this cycle, as there is still no meaningful heifer retention to signal herd rebuilding. Zimmerman added that the sharp decline in Mexican feeder cattle imports is not yet fully reflected in fed cattle slaughter and could reduce harvest numbers by 800,000 to 1 million head over the next year.
Peel said that, given the slowest herd rebuilding pace in U.S. history, elevated cattle prices could persist through much of the decade. While political comments earlier this year triggered fund liquidation in futures markets, Zimmerman noted that cash fundamentals continue to validate current price levels.
Consumer demand also shows no sign of weakening, with no evidence of substitution toward other proteins. On the processing side, Bryon Wiegand said some packers have faced eight consecutive quarters of losses, though Peel expects them to withstand pressure as long as possible to avoid losing market share in an already concentrated industry.
Source: Drovers
