Beef prices keep going up, and there's no end in sight
Why it matters: Meat's high price tag is squeezing grocery budgets at the height of grilling season, and as President Trump's tariffs creep into the inflation data.
These prices "are just the tip of the iceberg," Patrick Montgomery, CEO and cofounder of Missouri-based KC Cattle Company, told Axios.
"Prices for beef will continue to be tumultuous for the next two to four years."
CPI shows rise in ground beef, steak prices
By the numbers: Ground beef averaged $6.12 a pound in June, up nearly 12% from a year ago, according to new federal data released Tuesday.
Steak prices jumped 8% year-over-year, per the latest Consumer Price Index (CPI) from the U.S. Bureau of Labor Statistics.
It's the first time that ground beef has been above $6 since CPI data collection began in the 1980s, per the Joint Economic Committee's minority arm.
It's a heavy price pressure for the second-most consumed meat in the U.S., according to USDA data released Thursday.
The average American is expected to consume 59.1 pounds of beef in 2025 — compared with 102.5 pounds of chicken and 50.3 pounds of pork, per the data.
What's behind the high price of meat
The big picture: America's beef supply chain is being strained from multiple angles: climate, policy and economics. A multi-year drought shrunk cattle herds, and global imports are under threat — but consumer demand remains strong.
"We're dealing with lower supplies of beef, and that's what's really driving up our prices of beef right now," Courtney Schmidt, sector manager at Wells Fargo's Agri-Food Institute, tells Axios, noting that it is taking a long time for herds to recover from the 2021-2022 drought.
The number of farms in the U.S., including ranches, declined by 7% or 141,733 between 2017 and 2022, according to the latest USDA Census of Agriculture report, published in February 2024.
The American Farm Bureau Federation cites high production expenses and foreign competition as two reasons for the closings.
Zoom in: In May, the U.S. suspended live cattle imports from Mexico because of the New World Screwworm, a parasitic flesh-eating maggot.
Andrew Coppin, CEO and co-founder of Ranchbot, tells Axios the temporary banning of the import of Mexican cattle added to this price pressure.
"What we are experiencing as a country is a trifecta resulting in the perfect storm for record high beef prices," Montgomery told Axios.
Trump's new 50% Brazil tariff, more imported beef
Zoom out: With lower supplies in the U.S., Wells Fargo's Schmidt says there has been an increase in beef imports.
"Those higher imports of beef have not been enough to offset the lower supply that we're having in the U.S. but that is helping with some of our prices," Schmidt said, adding that imported beef is primarily coming from Australia, Brazil and some from New Zealand.
Yes, but: A new 50% U.S. tariff on Brazilian imports starting Aug. 1 could further disrupt global supply chains.
Brazil accounts for around 23% of all U.S. beef imports.
Brazilian meatpackers are reconsidering future beef shipments to the U.S. because of the tariff, Reuters reported Tuesday.
Walmart opens its first beef facility
The intrigue: Walmart, the world's largest retailer, opened its first-ever owned and case-ready beef facility in Olathe, Kansas, last month — part of a multiyear push to gain more control over the meat supply chain.
Beef from the new 300,000-square-foot facility will be sold at Walmart stores in the Midwest region as part of a commitment to American-made products, the company said.
Walmart hasn't disclosed what percentage of its total beef supply this facility will serve, but told Axios the Midwest region represents more than 600 stores across 14 stores.
The retailer said the new facility increases "needed capacity in the beef industry and allows Walmart greater control in offering high-quality items for its customers while keeping up with customer demand."
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