Ground beef prices surge as farmers sell off cattle herds
(NewsNation) — The cost of putting food on the table is the highest it's been in 40 years, and inflation is specifically impacting a summertime staple: ground beef.
Ground beef prices are up 12% since this time last year, which is higher than the current inflation rate for the United States, which currently stands at 9.1%.
Severe drought amid high demand while reeling from pandemic disruptions and inflation is to blame.
In 2021, severe drought forced 40% of farmers to liquidate a portion of their herds, according to the American Farm Bureau Federation. This year, the percentage could be even higher.
Mike Baker, a cattle expert and farmer, said hundreds of farmers have been forced to liquidate their herds due to the severe drought, and send their cattle into feedlots early.
“Across the board, we’re seeing lighter weight cattle than tradition," Baker said.
Simply put, pasture land is dried out, there’s not enough food for them to eat, and hay is too expensive. These conditions have forced some farmers to sell all or part of their herds early.
Danny Jones, president of Superior Livestock Auction, says farmers have been in a drought for a couple of years, but this year marks the most widespread he’s seen in the last 36 years.
"We’ve seen worse droughts in places, but across the board, it might be as bad as it’s been," Jones said.
As of July 1, the nation's inventory of cattle and calves stands at 98.8 million head, down 2% from a year earlier, according to the latest data from the U.S. Department of Agriculture.
The USDA says it's seen a huge number of female cattle sent to the feedlots, which means there’s a lot of supply right now, but not for long.
"You build that genetic supply in your herd, so you've got a quality cow and calf that you've built up and if you have to liquidate, it is going to take a while to build back again," Baker said.
Experts predict that meat prices could go up another 9% to 10% next year, and cattle experts say it could take years to get back on track.