America’s vanishing cattle herd drives 15% price hikes for beef

Fortune

by Enda Curran, Ilena Peng, Bloomberg

February 15, 2026

AI-Generated Deep Dive Summary

The United States is experiencing a significant rise in beef prices, with costs increasing by 15% over the past year. This surge is driven by a shrinking cattle herd, which has reached its lowest levels since the early 1950s due to factors like droughts, higher production costs, and elevated interest rates. While efforts to boost competition in beef processing and increase imports from countries like Argentina have been initiated, these measures are unlikely to quickly resolve the supply issue. The scarcity of cattle is particularly challenging for ranchers, who are benefiting from higher prices but also grappling with rising operational costs such as equipment, repairs, and land rent. The situation highlights the delicate balance in the cattle industry, where raising animals for slaughter at a younger age has become more profitable than expanding herds for long-term growth. This shift, coupled with the ongoing impact of droughts and economic pressures, has led to a prolonged contraction in the cattle population. Experts estimate that any herd expansion would not reach the retail market until 2028, further extending the period of elevated beef prices. Ranchers, particularly those involved in cow-calf operations, are navigating a precarious environment. While they benefit from higher calf prices, the increasing costs of doing business leave many feeling financially vulnerable. This dynamic is compounded by external factors such as the halt of live cattle imports from Mexico due to a resurgence of a deadly parasite and soaring demand for calves destined for fattening. The meatpacking industry is also feeling the strain, with major companies like Tyson Foods reporting losses in their beef operations. These challenges underscore the broader economic implications for consumers, who are facing higher grocery bills as beef prices remain elevated. The combination of supply constraints and rising costs positions the cattle industry at a critical juncture,

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Originally published on Fortune on 2/15/2026