By Maddy Rohr
The current inventory of cattle in the United States is the smallest it’s been since 1951. The calf crop in 2025 was the smallest calf crop in the country since 1941. It is no secret that cow herds are getting smaller.
Cattle cycles have been a tool followed by economists for more than 140 years. They tell economists and producers alike what patterns affect the industry from cattle inventory to retail beef prices and where we are going.
“This last cattle cycle, the calf crop peaked in 2018 and has continued to get smaller for the last eight years,” said Derrell Peel, professor of agricultural economics at Oklahoma State University during a keynote session at the 2026 Beef Improvement Federation Symposium in June. “That’s important to keep in mind as we go forward.”
Peel noted the beef cow herd is the main driver of the cattle cycle and that the dairy industry doesn’t change a whole lot over time, contributing a part to the beef industry but not a lot.
“2014 was the previous low. That one was exaggerated by drought. This one is exaggerated by drought,” Peel explained. “We didn’t intend to be that small either of those two times, and we’re now 1.1 million head of beef cows smaller even than we were then.”
Consumer demand
Despite low inventory and high retail prices, improvements in quality grade over the years has resulted in a strong demand for beef this cycle.
“The National Beef Quality Audit helped us start to understand our consumer better and figure out what mattered to them,” said Dave Weaber, Terrain’s senior animal protein research analyst. “Taste and tenderness was the answer.”
Research inside retail stores has helped economists understand why consumers buy what they do and what factors influence their purchasing decisions. This data has greatly affected the beef demand despite high prices as well as the improvement in quality grade offered on shelves.
“There’s not a coincidence that the fine wine and French Cabernet is across the aisle from Wagyu, Prime and Choice Steaks,” Weaber said.
The forecast for consumer demand is equally as important as increasing inventory numbers. Weaber added something changed in 2023 that transformed beef demand.
“That was about the time our group really got concerned about what beef demand and beef spending was going to do because it’s paramount to our forecast,” he explained. “One of our charges is to forecast prices. The hardest component of any economist that’s trying to forecast is demand.”
Click here to see more...