Key facts
- Average retail ground beef price reached a record $6.90 per pound last month.
- Beef prices are up approximately 19% compared to a year ago.
- The U.S. cattle and calf population was 86.2 million in January, the smallest count since 1951.
- Drought conditions and heatwaves have reduced cattle populations.
- Feed costs have increased due to drought and higher fertilizer prices.
- U.S. beef consumption has remained steady for 15 years.
- Cattle herd expansion is not projected until 2028 at the earliest.
The average retail price for a pound of ground beef in the U.S. reached a record $6.90 last month, a 19% increase from the previous year. This price surge occurs despite the U.S. being a major global beef producer with high meat availability per person. The domestic cattle population has fallen to 86.2 million heads as of January, the lowest count since 1951. This decline is attributed to frequent drought conditions and heatwaves, which have reduced breeding and caused cattle deaths. Feed costs have also escalated due to reduced grassland availability and increased fertilizer costs. While meat produced per head has increased through selective breeding, the dwindling cattle stocks combined with consistently strong consumer demand, which has remained largely unchanged for 15 years, are driving up prices. Rebuilding the cattle herd is a lengthy process, with projections suggesting herd expansion may not begin until 2028 at the earliest. Beef's price inelasticity means demand fluctuates little with price changes, exacerbating the supply-demand imbalance and leading consumers to bear the cost of higher prices.