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Consumers are continuing to show strong interest in purchasing beef even with prices at historic highs amid low cattle inventories.
“You can't explain beef or cattle prices the last two years simply with a supply discussion,” Kansas State University Economist Glynn Tonsor told Agri-Pulse. "It's a consumer demand pull that's pulled those prices up.”
According to data in USDA's World Agricultural Supply and Demand Estimates analyzed by the Economic Research Service, beef disappearance for 2026 is projected at 59.5 retail pounds per capita, which would be a slight increase from 2025's estimated 59.2 pounds per capita.
Meanwhile, the average retail price of beef increased 15% from January 2025 to January 2026, according to the Consumer Price Index. 
Charlotte Talbott (Rabobank photo)
The average retail price of ground beef climbed to an average of $6.75 per pound in January, up from $5.55 per pound a year earlier, according to the Bureau of Labor Statistics. Just five years ago, in January 2021, the average price was under $4.
“I think everyone’s been really impressed with the resiliency of the consumer to continue purchasing beef,” Rabobank Animal Agriculture Sustainability Analyst Charlotte Talbott said at the National Cattlemen's Beef Association's annual CattleCon convention earlier this month.
“When prices are high, when consumers are under pressure, they start looking for cheaper alternatives. But we continue to see consumers just going to beef over and over and over again. So I think the question is, ‘where is the ceiling of that?’”
A fact sheet released in December by Tonsor and another KSU economist, Brian Coffey, estimates that a significant factor in an increase in all-fresh beef prices between 2024 and 2025 was increasing demand for the product. Their analysis attributes 87% of the price increase during that period to increased consumer demand and only 14% to reduced supplies.
Ricky Volpe, an agricultural economics professor at California Polytechnic State University, told Agri-Pulse that “demand elasticity” for beef and eggs is low, which means “there is almost no responsiveness to aggregate demand with respect to price.”
Despite beef prices generally being seen as at or near record highs, demand for the product is “remarkably stable,” he said.
Cattle expansion expected in coming years
U.S. producers saw cattle and calf inventories of only 86.15 million head in January, a low not seen since 1951, according to USDA’s most recent survey in January.
USDA estimated the number of cows and heifers that have calved at 37.2 million head in January, a slight decrease from 37.3 million a year earlier. The agency estimated beef cows at 27.6 million head, a 1% drop from the year prior.
USDA estimated cattle and calves on feed for the U.S. slaughter market totaled 13.8 million in January, a 3% drop from the previous year.
Derrell Peel, an agricultural economist at the University of Oklahoma, said the data confirm that the overall cow herd continues to shrink, although the number of beef replacement heifers increased somewhat.
He said, "2025 could have been the cyclical low from a beef cow herd standpoint, but it wasn’t. We got another 1% smaller. So now we'll wait and see. More than likely, this will be the low, but we won't actually know that until next year's data."
Tonsor expects national herd expansion to begin in the summer of 2026, noting that there are likely some heifers that will be among the calves born this spring that could be kept on the ranch to become cows instead of being sold this fall alongside other calves.
A survey by Terrain and 10 Farm Credit associations in December of more than 1,000 cattle producers across 28 states found that nearly half bred more females in 2025 than in 2024.
Terrain analyst Dave Weaber wrote in his analysis that “more of that increase came from adding cows (58.5%) rather than raising heifers (41.5%)” and noted that the "distinction matters because buying cows shifts animals between operations without adding new cattle to the national total.”
Dave Weaber (LinkedIn photo)Weaber said the data suggested that the national beef cow herd “likely grew slightly heading into 2026, perhaps by 1.5% to 2.5%.” Nearly half of the survey respondents also planned to increase breeding females in 2026, while just over a quarter planned to do so in 2027, according to Weaber’s analysis.
But Weaber told Agri-Pulse that if expansion does occur, it will likely happen slowly. He doesn’t expect “earnest growth until probably 2027," and that’s assuming drought conditions don’t become too severe.
Weaber also noted that the Terrain analysis saw little indications of expansion in cow-calf operations with 1,000 or more head, but more likely indications from mid-sized operations. He noted that another reason larger operations may be more hesitant to grow could be due to their prevalence in the Western U.S., which has been subject to drought conditions in recent years.
Argentinian beef imports expected to have limited impact
The Trump administration earlier this month announced a new deal that would permit Argentina to import 80,000 metric tons of additional lean beef trimmings tariff-free in 2026, or 20,000 metric tons per quarter. Previously, the quota was set at 20,000 metric tons per year, according to the Economic Research Service.
Peel, the Oklahoma State University economist, told Agri-Pulse that last year Argentina represented about 2.2% of total U.S. imports. He said he’s not positive that Argentina could fully fill the new tariff rate quotas, but even if it could, “it would be like 4% of our total and it probably wouldn’t change the overall supply of imported beef, because more than likely, anything they increase would just be a displacement of something we’re getting already from somewhere else.”
The Argentina deal probably won't have a significant impact on prices either, said Tonsor.
“I don't think it's going to lower them here in ’26, and I also don't think it's going to depress cattle prices in ’26,” the Kansas State economist said.
But he said the uncertainty stemming from the political nature of the decisions could impact producers’ decision-making when it comes to herd expansion.
