Beef prices in the U.S. are searingly high. Here's why.
"Anybody should be able to afford a burger," said Andrew Schnipper, a managing partner at Hamburger America in New York City. "It's never been an expensive item historically."
Yet the restaurant may be forced to raise the price of its burgers, which start at $7.50. "We're very focused on trying to charge the least amount we feel comfortable doing," he added. "But obviously, if prices go up we have to raise prices."
The cost of beef reached $5.98 per pound in May, according to Federal Reserve data — the highest since the Department of Labor started tracking beef prices in the 1980s. That rise hasn't come overnight. Ground beef costs have increased 45% over the last 10 years, compared with roughly 30% for the overall Consumer Price Index.
Overall food prices have eased since surging during the pandemic, although they're still up nearly 17% since 2022, according to the CBS News price tracker. That means a grocery bill that cost $100 back then would cost around $116.85 as of May (the latest data available).
So what accounts for higher beef prices? The answer largely comes down to simple economics, with demand outstripping supply. That has resulted in higher costs throughout the supply chain, including for meat processing companies, the restaurant industry and consumers.
"There's plenty of alternative protein sources in terms of pork and poultry, primarily in the U.S., that consumers could turn to that are in abundant supply and relatively cheaper," Derrell Peel, a professor in the department of agricultural economics at Oklahoma State University, told CBS MoneyWatch. "And yet beef demand has stayed remarkably robust."
Shrinking herds and drought
If the rules of supply and demand explain why beef has gotten so prices, other dynamics come into play.
Notably, Americans' enduring appetite for beef has coincided with shrinking cattle herds. The number of beef cattle in 2025, 27.8 million, is the lowest it's been since the 1960s despite the growing U.S. population, Agriculture Department data shows.
Over the last decade, in turn, the decline in cattle supplies has mainly been driven by drought conditions around the U,.S., which reduced the available feedstock and forced many cattle ranchers to sell off their beef cows, Peel said. "They simply had no choice because of the drought."
Most recently, a severe drought started in 2021 and continued through last year, sweeping through the western half of the country.
"Somewhere during that period, just about every major beef cow-producing area was subject to drought and subject to this sort of forced liquidation," Peel said.
Even without the challenge of insufficient rainfall, herds take a long time to grow due to the biology of cattle. Cows can only have one calf at a time, and it takes longer for them to reach the age for slaughter than other livestock, Peel said.
Other factors driving up beef prices include high grain prices, tariffs and rising interest rates, according to a June study from NerdWallet, a financial services company.
Will prices cool?
Unfortunately for Americans, beef prices are expected to keep rising for some time. Diminished cattle supplies are likely to drive prices to new record highs in 2026, according to projections from the U.S. Department of Agriculture.
Longer term, Peel expects beef prices to stay high for the next several years as ranchers work on rebuilding their herds.
"We're going to be in a tight supply situation, in an elevated price situation for the next two to three years, probably to the rest of the decade," he said.
var pymParent = new pym.Parent( "tracker", "https://cbs-news-data.github.io/price_tracker_viz/", {} );
Sneak peek: Who Killed Aileen Seiden in Room 15?
Everything we know so far about the deadly Texas floods
Texas flood survivor says she decided to evacuate campsite despite no warnings or alerts
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
19 minutes ago
- Yahoo
How The J. M. Smucker Company (SJM) Fits into the Food Dividend Stock Portfolio
The J. M. Smucker Company (NYSE:SJM) is included among the 10 Best Food Stocks with Dividends. A wholesaler distributing peanut butter, fruit spreads and specialty spreads to a retailer. The J. M. Smucker Company (NYSE:SJM) is recognized as a strong value in the food sector, with several successful brands under its belt. Notable performers include pet food lines like Meow Mix and Milk-Bone, as well as the well-liked Uncrustables sandwich products. The company paid a premium when it acquired Hostess Brands in November 2023. To refocus its efforts, the company recently sold off some brands from its Sweet Baked Snack segment, including Voortman, to concentrate more on the Hostess portfolio. Although the transition has been challenging, The J. M. Smucker Company (NYSE:SJM) appears to be moving in the right direction. It anticipates full-year fiscal 2026 sales to grow by 2% to 4%, despite the effects of divesting certain Sweet Baked Snack value brands. The company is also expected to deliver strong earnings and free cash flow. In fiscal Q4 2025, The J. M. Smucker Company (NYSE:SJM) reported operating cash flow of $393.9 million, and its free cash flow was $298.9 million. During the quarter, the company returned $114.5 million to shareholders through dividends, reinforcing its commitment to investor return. This cash position enables the company to consistently raise its dividends. The J. M. Smucker Company (NYSE:SJM) declared a 1.9% hike in its quarterly dividend on July 16. This marked the company's 24th consecutive year of dividend growth, which makes it one of the best food stocks with dividends. The company now offers a quarterly dividend of $1.10 per share and has a dividend yield of 4.04%, as of July 27. While we acknowledge the potential of SJM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: READ NEXT: and Disclosure: None.
Yahoo
19 minutes ago
- Yahoo
Why Flowers Foods (FLO) is a Top Food Stock for Dividend Investors
Flowers Foods, Inc. (NYSE:FLO) is included among the 10 Best Food Stocks with Dividends. A female baker in a spotless kitchen carefully decorating a cake. Flowers Foods, Inc. (NYSE:FLO) is an American company that manufactures a range of bakery products for both retail and foodservice markets nationwide. Its offerings include items like fresh bread, buns, rolls, snack cakes, and tortillas. The company supplies these products to grocery stores, convenience outlets, and restaurants. Among its most recognized brands are Nature's Own, Whitewheat, Cobblestone Bread, Wonder, Dave's Killer Bread, Canyon Bakehouse, Mrs. Freshley's, and Tastykake. Flowers Foods, Inc. (NYSE:FLO) has a strong cash position. In the most recent quarter, the company generated $135.6 million in operating cash flow, which grew by $30.5 million. The company also remained committed to its shareholder obligation, returning $52.3 million through dividends during the quarter, up $1.2 million from the previous quarter. Flowers Foods, Inc. (NYSE:FLO) currently offers a quarterly dividend of $0.2475 per share, having raised it by 3.1% in May. This was the company's 23rd consecutive year of dividend growth, which makes it one of the best food stocks with dividends. In addition, it has paid regular dividends to shareholders for 91 quarters in a row. The stock has a dividend yield of 6.09%, as of July 27. While we acknowledge the potential of FLO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: READ NEXT: and Disclosure: None.
Yahoo
19 minutes ago
- Yahoo
Analyzing Hormel Foods Corporation (HRL): A Reliable Food Dividend Stock
Hormel Foods Corporation (NYSE:HRL) is included among the 10 Best Food Stocks with Dividends. A close-up of a hand cutting fresh turkeys, revealing the perishable products of the company. The company is facing several challenges, including rising costs, avian flu, a slow recovery in China, and early issues with its Planters acquisition. While none of these are likely to harm the business long-term, their combined effect is significant. To address this, Hormel is focusing on product innovation, improving efficiency, and revamping its leadership. Backed by The Hormel Foundation, which supports the company's long-term success, the new management team is well-positioned to guide it through these headwinds. Hormel Foods Corporation (NYSE:HRL) reported strong earnings in fiscal Q2 2025. The company's revenue came in at $2.9 billion, which showed a 0.4% growth on a YoY basis. It reported operating income of $248 million, with adjusted operating income reaching $265 million. Management expressed optimism for strong growth in the second half of the year, driven by a portfolio centered on consumer-focused, protein-rich products. They highlighted expected gains from the turkey segment, continued progress with the Planters brand, strength in key market-leading categories, and ongoing advantages stemming from the Transform and Modernize (T&M) initiative. Hormel Foods Corporation (NYSE:HRL) ended the quarter with nearly $670 million in cash and cash equivalents. The company generated an operating cash flow of $56 million. It currently offers a quarterly dividend of $0.29 per share and has a dividend yield of 3.97%. HRL is a Dividend King with 59 consecutive years of dividend growth under its belt. While we acknowledge the potential of HRL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: READ NEXT: and Disclosure: None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data