Beef prices expected to rise as drought eats into ranchers' cattle counts
There's likely to be a change in the cost of beef at the grocery store. That’s because historic drought and other factors are pressuring producers across the country to reduce their cattle counts.
The U.S. Department of Agriculture reported a 3% drop in the country's cattle and calves inventory as of Jan. 1. The number of beef cows – which amounts to about a third of all cattle and calves in the U.S. – was down 4%, the smallest count in more than 60 years.
Most states in the Mountain West saw declines that were slightly less than the national average. Except for Utah, that is, which had a 6.3% drop in its total number of cattle and calves compared to 2021.
Many producers attribute the lower numbers to the prolonged drought gripping the West, which has increased the price for hay.
“Normally I raise all the hay I need for my cattle – I've even sold some some years. But the last couple of years have been very tough,” said Carlyle Currier, a rancher and president of the Colorado Farm Bureau. “2021 was an extremely dry year in western Colorado and in Utah and all the Colorado River Basin really, so production was down very substantially nationally.”
Currier ranches in Molina on Colorado's Western Slope. He said high feed and hay costs forced him to decrease his herd by 20%.
“Hay that was selling for $100 a ton four years ago is now bringing closer to $300 a ton,” he said. “If you have to feed the cows that aren't creating that much income, well, you sell the cows instead of buying more hay.”
Brett Moline, the director of public and governmental affairs at the Wyoming Farm Bureau Federation, said it’s more than just the hay prices causing people to give up their cows.
“Equipment costs, diesel fuel, supplies – everything is going up,” he said. “The farmers were having a hard time even being able to get some of their fertilizer, let alone afford it. So that's cut into the crop yields. "
For some farmers, the cost barrier is even greater than supplies, Moline said.
“We're getting more and more people that are just selling their grass instead of running, you know, a cow-calf operation or cow yearling. They're just running livestock for somebody else to help cut their risk. They can't afford to buy back in.”
With fewer ranchers raising cows, the price of beef is expected to rise, especially for choice cuts.
“I think the demand will still be there for the quality cuts,” Moline said. “But some people will move down the quality line to go from steaks to hamburger.”
Moline believes that although the herds are shrinking, farmers and ranchers have learned to be more efficient with less meat, and he thinks the pricing cycle will reverse.
“When we have the good years we try to save up for the bad years, pay off some debt, replace our equipment,” he said. “That's just the way agriculture's always been and it probably always will be.”
Still, Currier said the future of the industry and its pricing rests on what the weather does. He’s worried about states like Texas where ranching is huge and the drought is persisting. He remains optimistic about Colorado’s ranching, at least in the near-term, due to this year's above-average snowfall.
“We have as much snow now as we ever had last winter, so things are looking very positive here for the amount of water we'll have next year and next summer," he said. "There'll be more cattle raised here in western Colorado than the past few years.”
This story was produced by the Mountain West News Bureau, a collaboration between Wyoming Public Media, Nevada Public Radio, Boise State Public Radio in Idaho, KUNR in Nevada, the O'Connor Center for the Rocky Mountain West in Montana, KUNC in Colorado, KUNM in New Mexico, with support from affiliate stations across the region. Funding for the Mountain West News Bureau is provided in part by the Corporation for Public Broadcasting.
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