While the core fundamentals of the beef industry remain unchanged, the overall environment has become much more volatile and uncertain in recent weeks.
Omaha Steaks CEO Nate Rempe, in a recent interview on Fox Business’ Mornings with Maria, predicts ground beef prices will reach $10 per pound by the third quarter of 2026.
In response to that prediction, ag economist Glynn Tonsor from Kansas State University reports, according to September Bureau of Labor Statistics (BLS), the national average price for ground beef was $6.32 per pound. He explains while niche markets such as Omaha Steaks could see some products priced at $10, the national average is unlikely to reach that level within the next three years.
Tonsor emphasizes Omaha Steaks serves a distinct customer base, and their prices should not be generalized to represent all U.S. ground beef prices.
Lance Zimmerman, senior animal protein analyst with Rabo AgriFinance, adds: “It’s possible, but that’d be pretty wild. Is it probable? I would say no, based on history.”
He explains his stance also referring to the BLS historic data, although prices spiked radically during the pandemic posting the highest year-over-year increases on record, that event only resulted in a 34% jump, far short of the 54% increase needed to see $10 ground beef by the third quarter of 2026.
What Does All This Beef Chatter Cause?
The beef industry has found itself in national headlines since Sept. 15. The industry has been experiencing chaos in the markets since President Donald Trump made statements regarding the need to lower beef prices as well as his request for the Department of Justice to investigate meatpackers for driving up the price of beef.
“The base fundamentals of the industry have not changed in the last four weeks,” Tonsor says. “The volatility, the noise in the business environment, has definitely elevated.”
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Zimmerman explains while political sound bites and promises to lower food prices draw media attention, they do not directly affect the day-to-day decisions by producers who remain focused on long-term business fundamentals.
“At the end of the day, the average cow-calf producer, stocker operator and feedlot operator, have a business to run, and all of this noise doesn’t change much surrounding their day-to-day business,” Zimmerman summarizes. “The challenge is the president is making this a very regular soundbite, as is the rest of his administration. And, cyclically, there is no quick fix.”
Zimmerman shares his frustration regarding the broader impact of political statements, especially presidential promises to bring down food prices. He explains that, historically, the only way to significantly reduce food costs is to enter a recession. The catch, he argues, is that neither administration nor producers desire such an outcome. This underscores the conflict between policy rhetoric and on-the-ground market drivers.
Tonsor adds media attention and dramatic statements, such as $10 ground beef, often do not accurately represent broad market reality.
“I’m trying to use this as an excuse to educate on why prices are higher; [it’s] not just because cow numbers are down,” Tonsor explains. “When we just jump to the number of cows, we don’t give credit to the demand story that the public wants beef.”
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One question on the mind of producers and industry stakeholders is if the political and media attention will heighten consumer awareness to beef prices and cause a change in buying behavior.
Tonsor says, so far, there is little impact from these headlines on consumer demand.
“It’s too early to tell if there’s been a consumer demand impact from all the chatter,” he says. “My best guess is little-to-no direct impact.”
Both analysts agree beef prices are fueled by demand. Tonsor notes consumers are willing to pay the retail price of beef today because of their continued demand for taste and protein. He points out if public demand for beef stays strong, prices will remain robust.
“The public still thinks taste is the most important thing when they make a decision,” he summarizes.
Slowing Down Rebuilding
“This uncertainty has wrecked the market potential in Chicago in the short run,” Zimmerman explains. “But the timing of it also couldn’t be worse for the cow-calf producer who’s making those fall retention decisions right now.”
Both analysts agree the heightened uncertainty is making producers more hesitant to invest or expand their herds, which will lead to slower industry investment and herd growth.
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“I think we’re going to slow investment compared to even a month ago, just because those that are anxious or don’t like uncertainty are a little more cautious today than they were a month ago,” Tonsor explains. “Those that are extra uncomfortable with elevated uncertainty, like not knowing what the trade environment might be, it’s going to give them pause. So, they will be less likely to hold back a heifer and expand. They’ll be less likely to modernize the feedyard. They’ll be less likely to do whatever that capital investment was.”
Will Tarriff Reduction Impact Prices?
Late last week, Trump signed an executive order that modifies the scope of the reciprocal tariffs he first announced on April 2. The executive order now exempts several agricultural products from tariffs, including beef.
Zimmerman explains Brazil’s beef processors and beef exporters would have gained the most if the country’s additional tariffs were removed by the U.S. The previous rate was an additional 50% tariff on top of the 26.4% tariff that exists on all imports from countries without a free-trade agreement on beef after the first 65,005 MT each calendar year. However, the Brazil tariffs are structured under two separate practices. Ten percent are reciprocal tariffs, and the additional 40% that came in August are through another process.
“The latest removal of reciprocal tariffs on beef effectively changes Brazil’s country-specific import tax from 50% to 40%,” he explains. “This is not going to significantly change the competitive landscape for global exporters shipping into the U.S. market. It is still incredibly tough for Brazil to compete with Australia, New Zealand and other major lean beef importers in the U.S. market.”
Tonsor adds reducing tariffs could marginally lower beef prices for consumers, but the effect would not be dramatic. He points out the U.S. produces the majority of its own beef (more than 80%), so changes in import tariffs have a limited impact on domestic prices.
He says recent record import months only moved the import share from around 15% to slightly more than 20%. Tonsor expects the net effect of the tariff reduction on beef prices to be fairly small, potentially less than a 5%-to-10% change, and that overall, strong domestic demand will continue to be the main driver of prices.
Challenge to Producers
Tonsor says his advice to producers is to steady the ship.
He encourages a steady approach, suggesting those comfortable with uncertainty should move forward as planned, while others might pause on major decisions. Ultimately, he expects less herd expansion and more caution among producers, even as demand fundamentals continue to provide underlying strength for the industry.
Tonsor says while general industry investment and expansion might slow, producers who move forward despite the uncertainty could be rewarded, especially if fewer others do the same. His overall message is for producers to carefully weigh their risk tolerance and business needs before making significant changes and not to let the current noise distract from their long-term goals.
Despite recent market corrections, Zimmerman says strong demand and cyclical tightness mean profitability remains high for most producers. He shares these six strategies for producers to consider looking forward:
- Consider Strategic Heifer Retention. He advises producers to begin or continue retaining heifers, even if only enough to replace natural attrition in the cow herd, as a step toward gradual herd rebuilding in tight supply conditions.
- Use Price Protection Tools. He emphasizes the importance of locking in profit floors using risk management tools such as Livestock Risk Protection (LRP) insurance, futures or options contracts, encouraging producers not to wait for the highest prices but to protect profitability when opportunities arise.
- Maintain Long-Term Perspective. Despite recent market corrections, he urges producers to keep a long-term view; demand is strong, and rebuilding will be slow, so planning for sustained higher prices is key.
- Stay Vigilant and Informed. He recommends producers remain watchful for profit opportunities in the market, be proactive in their strategic decisions and stay informed about both market trends and policy changes.
- Be Cautious, Not Reactionary. He suggests not overreacting to political headlines or media narratives, emphasizing that day-to-day operational fundamentals should guide decisions rather than short-term noise.
- Prepare for Continued Volatility. He encourages resilience and adaptation strategies as the industry faces persistent uncertainty from trade policy and disease threats such as New World screwworm.
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