Beef Demand in the US on the Rise as Domestic Beef Production Decreases

Domestic beef production in the US is on the decline as demand from international markets rises. The decline is due to a natural cyclical reduction in cow numbers after peaking in 2019 in combination with recent droughts and the rapid increase in feed costs. US production is estimated to decline by 3% in a continual pattern of a 2-5% annually into 2026. This decline will lead to a potential loss of 400K-500K MT of beef from the US production system during this period. Retailers, wholesalers, and other consumers are looking to the global market to fill this gap. Mexico and Canada, as US neighbors, and the largest beef suppliers to the US will be the first and logical production regions to turn to for this reason.

Unfortunately, both countries have their challenges regarding their cattle volumes and won't be able to fill the gap. Australia and New Zealand as the second largest suppliers to the US market also have their challenges and predictions are that they won't be able to fill the gap in the US market either. This leaves South America, but due to the current lack of trade access, it won't be enough either. Projections show that even if the trade arrangements are put in place, the increase in production from South America will not be enough to offset the drop in US production.