US cattle herd reaches a historic low while beef prices hit new highs amid ongoing challenges
The latest USDA cattle report reveals that the US cattle herd reached a historic low as of July 1, 2025, with only 94.2 million cattle and calves. This is the smallest mid-year cattle count since 1973, marking a significant challenge for ranchers and consumers alike. Despite the ongoing cycle of herd liquidation, beef prices remain at record highs, offering little relief for consumers.
Cattle numbers are struggling due to several factors, including high feed costs, drought conditions, and rising interest rates. However, ranchers are now considering rebuilding herds, though it remains unclear whether the shift will be substantial. While there have been reports of increased heifer retention, the growth in the herd is expected to be slow. “The latest USDA numbers offer ‘very little indication of much herd rebuilding or anything very aggressive,’ said Derrell Peel, a professor of agricultural economics at Oklahoma State University,” Freitas Jr reported. “The number of heifers in feedlots remained mostly stable relative to that for steers, suggesting ranchers are not meaningfully retaining females for breeding. ‘We are probably stabilizing cattle numbers, but we’re not growing yet.”
Moreover, the U.S. government’s suspension of cattle imports from Mexico due to the New World Screwworm disease is exacerbating the issue. Mexico, a major beef supplier to the U.S., has seen its exports sharply reduced, further tightening beef supplies. As a result, U.S. imports have hit record levels, with countries like Brazil, Australia, and New Zealand stepping in to fill the gap.
The beef industry is facing multiple pressures, including rising domestic production costs and the looming threat of additional tariffs. These factors, along with reduced imports, are likely to maintain high beef prices well into 2026.
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