The growing shortage of slaughter-ready cattle in the United States continues to drive beef prices to record levels. In May, US consumers paid an average of US$/lb 7.06 for ground beef, 13% higher than a year earlier, according to data from the US Bureau of Labor Statistics.
The main factor behind the price surge is the reduction in the US cattle herd, which has fallen to its lowest level in 75 years. USDA estimates the national herd will reach 86.7 million head in 2026, well below historical levels. Although Brazil is also experiencing a period of tighter cattle supplies, its herd exceeds 178 million head, more than double that of the United States.
Rebuilding the US herd has been a slow process due to several years of drought and elevated production costs. More recently, concerns have intensified following the reappearance of New World Screwworm (NWS), which was detected in calves in Texas for the first time in five decades.
Analysts cited by Bloomberg said the main concern is not food safety but rather the potential impact of animal health measures on cattle movements. Transportation restrictions, quarantines, and additional inspections could further constrain supplies that are already exceptionally tight.
Several states, including Oklahoma, Georgia, and Missouri, have begun requiring additional permits and inspections for certain cattle movements. Canada has blocked imports of animals that have been in Texas during the previous 21 days, while the United States continues to suspend imports of Mexican cattle, a source that historically supplied around 1 million head annually.
Drought remains another key factor. According to estimates cited by Bloomberg, about 80% of the US cattle herd is located in areas experiencing dry conditions.
Source: Bloomberg
