This article analyses the current beef prices, the contributing factors that have led the industry to this point and ways in which processors and retailers can navigate the challenges they bring.
Volatility has become the defining feature of the US beef market of late. Prices have surged to record highs thanks to a tightening supply chain, shifts in global demand and the new political headwinds affecting trade. It is the last of these – the US tariffs – and the ripple effects they’ve created across international markets, which are without a doubt one of the biggest disruptors right now.
Allen Featherstone, Professor of Agricultural Economics at Kansas State University, points to China as a telling example. With its sharp decline in US beef imports over the past year and unsettling trade flows, it has added uncertainty for cattle producers and processors even amid excitingly high prices. This has been magnified by the considerations of other countries like Australia and South America as they increase their footholds in the global beef marketplace.
Enjoying the higher margins of profitability in 2025, cow-calf and feedlot operations are adjusting herd sizes and production plans, though these changes take years to influence the market due to the long production cycle.
Exports, particularly to China, have declined sharply, while imports of ground beef are rising to meet domestic demand. Economist Chad Hart of Iowa State University notes that while overall domestic demand remains strong, influences like declining exports, rising imports and changing consumption patterns will influence future herd expansion and market stability.
“Domestic demand is holding up, but the real question is how herd rebuilding responds over the next few years,” he explains. “Lower-income consumers trading down and reduced exports mean producers need to be strategic about which cattle they keep and when they bring them to market.”
US producers remain focused on high quality cuts, which shapes both export opportunities and import reliance. But this isn’t without typical risks from tariffs.
“From a competitive standpoint, if US tariffs persist, countries like Brazil, Argentina, and Australia may invest in feedlots, challenging the US’s historical advantage in grain-fed beef,” Featherstone notes.
It’s noteworthy that much of the current price volatility stems from trade barriers and logistical challenges rather than weakening demand.
Elliott Dennis, associate professor of livestock marketing and risk management at the University of Nebraska–Lincoln, explains that tariffs have redirected US beef away from China and towards smaller countries.
“If we can't ship it to China, then maybe we can sell an additional 1% or 2% more product to the smaller countries both in volume and value,” he says. “These other countries really make up the difference for what we're losing in other markets.”
Rather than contracting, the export market has diversified. Dennis credits efforts from the US Meat Export Federation and the beef checkoff program for opening new opportunities in places like Central America, Japan, Korea and other regions with growing middle class demand.
Domestically, producers and packers are navigating a low-supply, high-demand environment by keeping cattle on feed longer and increasing carcase weights, maintaining steady overall beef production. Consumers have shown resilience to higher prices, supporting healthy demand across the market.
Even with a favourable demand and consumer-end prices, the supply chain continues to battle increasing production costs and unpredictable margins. Processors are balancing higher input costs with limited cattle supplies, while retailers and distributors face challenges forecasting demand as export flows shift unpredictably.
Decisions made by ranchers today on breeding, feed or herd expansion may not yield results for several years, highlighting the need for flexibility and forward looking strategies.
“Even with strong cattle and calf prices, herd rebuilding won’t happen overnight,” says Hart. “Our cattle herd is the smallest it’s been in 80 years, and we’re not seeing the next generation of ranchers step up quickly enough to reverse that trend.”
Producers are weighing whether to retain heifers or scale back, while sales teams adjust procurement models to secure product in advance and reduce exposure to short term price swings. Forward contracting, futures and other price risk tools are anchors for stabilising both production and margins.
Industry leaders are increasingly relying on data-driven forecasting and coordinated supply chain planning to anticipate disruptions. Real-time analytics help buyers and packers react to market shifts, while collaboration among feeders, processors and retailers supports steadier throughput.
“Risk management is crucial right now,” says Hart, speaking of modern tools. ”For producers, that means using futures or options to build a price floor under high-cost animals, and for packers, it’s about capturing the margins needed at retail to stay viable.”
Flexibility is emerging as a competitive advantage. Producers are diversifying outlets, sourcing teams are expanding their options, and the most resilient operations are treating volatility not as a setback but as an opportunity to refine strategy.
“We’re only halfway through the trade story,” Hart concludes. “Relationships with key markets like China remain a black box, but the industry that diversifies and plans ahead will be the one that stays competitive.”
Want to read more of our expert analysis of the US beef sector? Then check out protein expert, Jacob Einberger's, blog on the subject here. Prefer to discover how our Meat Processing solutions can benefit your business? Then download our guide.