Wholesale beef prices have hit record highs, largely due to dwindling cattle populations and steady demand. This rise in costs is likely to translate to higher prices at fast food restaurants soon.
Recently, the Bureau of Labor Statistics reported that prices for ground beef and steak have surged. Sylvain Charlebois, a food policy researcher at Dalhousie University, notes that while burger chains may lock in prices through contracts, they can’t sustain high costs indefinitely. We’re already seeing menu items shrink or combo meals increase by a dollar. If beef prices remain elevated into next year, this trend may continue.
### Why Should You Care?
The spike in beef prices is affecting household budgets across the board. With the cattle herds at their lowest levels in decades due to factors such as drought and rising feed costs, relief may not come anytime soon. Import tariffs on beef from countries like Brazil could further limit supply and push prices higher.
### What’s Driving These Changes?
In July, the price of ground beef reached $6.25 per pound, a 12.6% increase from January. The U.S. cattle herd is now the smallest it has been since 1951, according to the USDA, and forecasts suggest that beef production will continue to decline until 2028. Agricultural economist Derrell Peel warns that consumers will very likely see sharp increases in grocery prices as a result.
Philip Howard, an agriculture professor at Michigan State University, adds that while higher costs are expected, some price increases may go beyond what is necessary, a phenomenon some refer to as “greedflation.”
### Expert Thoughts
Experts agree that it will take several years for the cattle industry to bounce back. Patrick Westhoff, director of the Food and Agricultural Policy Research Institute, explains the biology of bovine production—it takes time for a new cow to gestate and reach slaughter weight. He predicts constrained beef supplies for at least another year.
Kenneth Burdine, a livestock specialist at the University of Kentucky, emphasizes that farmers aren’t culling as many cows lately because the calf market remains strong. This reluctance further complicates the situation.
### What’s Happening with Imports?
The USDA has cut its beef import forecast for 2025 due to high tariff rates, particularly on Brazilian imports. Previously the largest source of beef imports, Brazil is likely facing reduced shipments, which could exacerbate supply shortages and elevate prices further.
### What Can We Expect?
Experts predict that beef prices will stay high through late 2025, possibly plateauing by 2027. Fast food chains like McDonald’s and Burger King have been contacted for comments on how rising costs are impacting their pricing strategies.
For those who enjoy a good burger, it seems we may have to brace ourselves for higher prices at the counter for the foreseeable future.
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Fast Food,Burgers,Beef,Burger King,McDonald’s,Restaurants,Tariffs,Brazil,Canada,USDA
