Ground Beef Price Soars 20.5% to $6.67 on Lowest Cattle Herd Since 1951
U.S. ground beef reached a record $6.67 per pound, a 20.5% year-over-year increase and 72% gain since January 2020, driven by a U.S. cattle herd shrinking to 85 million head, its lowest level since 1951. Supply constraints will likely keep Hormel’s beef costs high through at least 2028.
1. Record Ground Beef Prices
The average U.S. ground beef price surged to $6.67 per pound, representing a 20.5% annual increase and a 72% rise since January 2020, marking an all-time high for beef pricing.
2. Historic Cattle Herd Decline
U.S. cattle and calves inventory fell to approximately 85 million head, the smallest herd since 1951, down 45 million from its 1975 peak and 10 million below 2020 levels, tightening supply.
3. USDA Outlook and Production Forecast
The USDA projects total red meat and poultry production of 108.4 billion pounds in 2026, up 1% year-over-year, but expects further declines in beef output with a steer price forecast of $240 per cwt, a 7% increase.
4. Implications for Hormel Foods
Prolonged supply constraints and elevated cattle costs through at least 2028 could pressure Hormel’s beef segment margins, though pricing power may partially offset higher input expenses as processors adjust to tight market conditions.