Influenced by various factors, the price of beef in the United States remains high. As people complain about the expensive beef prices, Nate Rempe, the President and CEO of the American Omaha Steak Company, warned that Americans might see ground beef priced at $10 per pound next year.
Rempe estimated on Friday (November 14) on Fox’s “Mornings with Maria” show that the current number of cattle in the United States is at its lowest level in 70 years, while the demand for beef is at an all-time high. The result is a surge in beef prices, and by the third quarter of next year, Americans may see ground beef priced at $10 per pound in supermarkets.
He also predicted that beef prices will not see any substantial decrease until 2027, which will have a significant impact on American households.
The high price of beef has also caught the attention of President Trump. Last week, he instructed the Justice Department to immediately investigate processing plants that conspire to manipulate and raise beef prices. He believes that these meat processing plants, mostly foreign-owned or controlled by foreign entities, are artificially inflating prices, endangering American food security.
The United States is the largest beef processor in the world and also the largest consumer. The U.S. beef processing industry is mainly controlled by four major companies, including JBS USA, Tyson Foods, Cargill, and National Beef, which control 85% of beef slaughter, 70% of pork, and 54% of poultry processing in the United States. JBS USA and National Beef are controlled by Brazilian entities, accounting for 40% to 45% of total capacity.
However, industry leaders in the meat processing sector have a different view of Trump’s statements. Julie Anna Potts, President and CEO of the Arlington Meat Association in Virginia, stated that due to tight cattle supply and strong demand for beef, beef processing plants have been operating at a loss. She also pointed out that the beef industry is subject to strict regulation and transparent market transactions. Data from the Department of Agriculture also confirms that the beef processing industry is suffering catastrophic losses, with experts predicting this situation may continue until 2026.
Apart from the influence of beef processing on beef prices, factors such as tariffs, shrinking cattle herds, drought, and a cattle epidemic in Mexico are also believed to affect beef prices. Lori Ann LaRocco, a senior editor at CNBC, mentioned in her report that tariffs, drought, and the parasitic epidemic in Mexico have added pressure to the beef supply chain.
The United States is a major buyer of beef from Australia, Brazil, and New Zealand. Due to various tariffs, many Brazilian products have been subjected to a 50% tariff by the United States, leading Brazilian beef to seek other markets. Similarly, beef exports from countries like Australia, New Zealand, and South America (Uruguay) to the United States have also declined. LaRocco believes this has exacerbated pressure on the U.S. beef supply chain.
Domestic ranches in the United States have seen a decrease in land area due to drought, making it difficult for cattle farmers to expand their herds. Some ranchers argue that they are currently facing one of the most challenging beef market cycles in history, with low cattle reserves and the accelerated pace of rebuilding cattle herds also requiring time.
Additionally, an epidemic of parasites in some Mexican cattle herds has led to a ban on all Mexican beef imports, further intensifying pressure on the U.S. beef supply chain.
Last week, the price of live cattle mostly stood at $2.28 per pound, with a total slaughter volume of around 555,000 heads, decreasing from the previous week. Industry analysts believe that slaughter volume will stabilize around 550,000 heads in the coming months.
The quality grade of U.S. beef may also influence beef prices. As of the week beginning in early November, the beef grading was very high, with 85% graded as Choice or higher, 11.6% as Select, and only 3.4% as unrated.
The U.S. government announced on Thursday (13th) a reduction in tariffs on certain foods from Argentina, Ecuador, Guatemala, and El Salvador, aiming to help lower beef prices. However, this move may face resistance from American farmers. Some experts also believe that the relatively low amount of Argentine beef imported into the U.S. will not significantly change the overall supply of U.S. beef or impact prices.
Rempe also mentioned in the interview that as the holiday season approaches, Omaha Steak Company plans to maintain the prices of its main beef gift assortments unchanged for the fourth consecutive year by increasing efficiency and utilizing vertical integration methods.