The growing shortage of cattle for slaughter in the United States continues to drive beef prices to record levels. In May, American consumers paid an average of $7.06/lb for ground beef, 13% higher than a year ago, according to data from the U.S. Bureau of Labor Statistics.
The main explanation behind this surge is the reduction of the US cattle herd, which is at its lowest level in 75 years.
The USDA estimates that the cattle stock will reach 86.7 million head in 2026, well below historical levels. Although Brazil is also experiencing a period of reduced supply, its herd exceeds 178 million head, more than double that of the United States.
The recovery of cattle stocks in the US has been slow due to several years of drought and high production costs. Adding to this is the concern over the reappearance of the New World screwworm (NWS), recently detected in Texas calves for the first time in five decades.
Analysts cited by Bloomberg indicated that the main concern is not related to food security, but rather to the potential impact of health measures on livestock movement. Transportation restrictions, quarantines, and increased controls could further reduce an already tight supply.
Some states, including Oklahoma, Georgia, and Missouri, have already begun requiring additional permits and inspections for certain livestock movements.
Canada, for its part, blocked the entry of animals that have been in Texas during the last 21 days, while the US continues to suspend imports of Mexican cattle, a source that historically contributed around 1 million head per year.
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