Why is Beef so Expensive?
posted on
January 31, 2026
Part of our mission here at Red Hill Harvest is to ensure you are one of the most educated food eaters in the world! It is important for you to know what’s happening before your food hits your table so you can truly understand the impact you are making by choosing to eat it. Today, I want to talk a little bit about what is happening in the cattle production in the U.S. and really the whole world. More importantly, what you can expect going forward!
The conviction to write this blog post comes in response to a Tyson Foods slaughter facility closing its doors after 36 years in south-central Nebraska.
Is this a big deal?
No, probably not so much for you, but it is a significant indicator of the status of one of our nation's top-produced proteins.

As I’m sure you're aware, prices for beef, the delicious meat that comes from our 4 legged friends, the cow, have skyrocketed in the grocery store. To understand what’s going on, let's first examine how the larger cattle industry works in the U.S.
Farm 1: Cow-Calf - This is the place where baby cows are brought into the world. Oftentimes, on a ranch in wide open prairies, giving moms access to grass and relatively cheap feed. Once the calves reach about 6 months old, they are weaned from their moms and sold to the next phase of cattle production.
Farm 2: Stocker - Once calves reach the stocker phase of production, they are returned to pasture, where they eat grass and are often fed a small amount of grain supplements to support growth. This step can be skipped, but it is most often used to bring animals to a size large enough to enter the feedlot.
Farm 3: Feedlot - Animals often reach the feedlot when they are about one year old. They stay here for a few months, during which their main job is to eat, sleep, and gain as much weight as possible as quickly as possible. This is often a highly intensive process where cattle are fed a specific ration designed by “experts”. By this point in the process, the animals are either owned or forward-contracted to packers or slaughterhouses. This point will come up a little later in our discussion, so take note of it. They stay here until they reach their mature weight and are then sent to the butcher.

Now that we have a basic understanding of beef farming principles, we can better determine what caused this plant to shut down abruptly.
We first need to look at the industry as a pipeline. The constant flow of cattle in and out of Cow-Calf farms, to stocker farms, and then in and out of feedlots, represents the water. It is crucial that both ends of the pipe are constantly flowing because it takes a minimum of 24 months from conception or breeding to the time when a cow is mature enough to be slaughtered. If any point in the process is delayed, it will trigger a ripple effect that runs all the way back through the system, and it will take years to resolve.
In 2020, we faced our first blockage: a little pandemic called COVID-19 swept across our nation. The lockdown caused the processing facilities to temporarily shut down and forced the fragile system to back up. Feedlots were forced to hold their cows for much longer than expected, causing A) more economic strain (feed) and B) strain on the stocker and cow-calf farms. Since the feedlots were too full, they were forced to hold onto their animals and fill up their pastures.
Paired with the multi-year drought in the west, it was the perfect storm of disruption, causing mass chaos. The easiest way to stop, or at least slow, the ramifications of a blocked pipeline is to stop the flow into the pipe. That’s just what the Ranchers did!
Cow-calf operations bred a much lower number of momma cows in 2020 and 2021. This seemed to be the simplest solution, given the significant backlog of cattle not moving through the pipeline.
The only problem is that once the plug at the bottom of the pipe opened (slaughter facilities reopened), there were no calves to replace the stockyards and feedlots.
Since it takes a minimum of 20 months to get a cow to even hit the feedlot once you decide to breed the mom cows (9 months gestation plus 12 months of stocking), it takes a really long time to refill that pipe. As I said before, the drought didn't help the issue one bit. With the lack of grass, feed prices skyrocketed, making it more difficult to source feed for the cattle. In some cases, feed wasn’t just expensive, it was impossible to find.
The combination of drought, plus the slowdown of processing, forced cow-calf farmers to cull (or slaughter) their momma cows. Thus making the problem even worse! Now it will take longer for the young heifers just born to reach an age where they can be bred. Let only the extra 20 months to raise a newborn calf. It could take up to 3 ½ years to start a herd from nothing until you can slaughter your first cow.
What did we do to fix it? Well, nothing really. All of the farmers knew it was a big problem. The large companies that held forward contracts and cattle in the feed yard could keep costs lower for the first couple of months (since the price was already set), but going forward, the lack of feeder cattle entering the feed lots was evident. According to basic supply-and-demand economics, the price of cattle going into the feedyards skyrocketed. Causing the price to increase the whole way down the line to what you see now when you go to the store.
The ranchers who held on through the drought and uncertain times are now doing what they can to fix the problem. It looks like the number of cows bred and calving in 2026 is significantly higher than in previous years. This should be very positive and will help us to rebuild the herd size and potentially lower beef prices in the store. However, we will not be able to totally undo the damage.
What we thought was a safe, stable beef market was quickly exposed over the course of a few months by a short blip in one part of the industry. This served as a real wake-up call for producers and processors alike about the fragile system we currently have.

How can we fix the system to reduce volatility?
It’s a tough answer. Folks have been working hard in D.C. to improve legislation or give more money to farmers and ranchers, but it never seems to solve any of the problems. I believe our problem is consolidation. The beef industry is now controlled by a few hands. The number of ranchers and farmers in America has been on a steady decline since the mid 1900’s. At its peak, America had over 1.3 million ranches; only about 625,000 remain. We’re not eating any less beef; it's just being produced by fewer people.
The bigger problem is in the processing. It used to be that there was a butcher just about in every town, or sometimes two or three! Each would process the animals raised by farmers in the surrounding countryside. Grandpa often talks about how someone would help them process 3-4 beef cattle per year on the farm, and they would sell it to their market customers. Many farmers and longtime residents in our area can recall a very similar story. So why is it now that the vast majority of butchering is happening by about 12 plants each, which process over 1,000,000 head of cattle every year?
Consolidation. The industrial revolution provided some incredible efficiencies in transportation and production for the beef industry. Beef could now be shipped across the country fairly simply. The only problem? It was expensive. Which meant only wealthy families could invest in the new practices.
Although expensive, the efficiency it delivered was unmatched, and they quickly leveraged it to grow their operations. Small butchers held on, though, because they still had a customer base that appreciated the service they provided. However, they could not expect what was about to happen next.
In 1993, Jack in the Box, a large-scale processing facility, turned out product with E. Coli, killing 4 children, and causing 700 to be very ill. This created a significant push to regulate and closely monitor beef processing.
It wasn’t an insurmountable mountain for the big guys who could offset the costs of the inspection and hassle over the course of 1,000,000 animals every year. For the little guy who was processing maybe 100-1,000 animals every year, it was a nightmare. Their cost per head increased by almost 25%! The biggest problem is that the regulations just keep piling on.
Because they handle thousands of animals per day, large processors need to employ many people. Each of which probably (just taking an educated guess) doesn’t care as much about turning out a high-quality product as the small butcher who actually owns the business and is relying on it to feed his or her family.
Either way, regulation has forced these small processors to close. Once these small processors closed, it was more difficult and still is for farmers to find processors who will do smaller batches of animals for them to serve to their customers.
The major processors acquired everything that remained. Once they controlled the herd's market share, they could set the price they paid for live animals delivered to their facility, ensuring they always offered the lowest price to consumers.
Eventually, this price gouging forced many ranchers to close up shop, leaving only those with sufficient scale to raise a cow at a low enough cost.
We wouldn’t have had to stop production during COVID if the majority of beef were still being processed by family-run butcher shops. Farmers could still have safely delivered their beef to the facility, and the processors and their families could have easily cut up all the meat without risking the spread of the disease.
It would be a shame if I didn’t add that lots of farmers actually have been forced out of the beef industry because the price is too high! They simply can’t afford to restock their herd, causing yet again more consolidation in the industry.

So what can you do?
First of all, you’re already at the first important step, learning about the problem! I encourage you to do some more research on the history of not only beef, but all of the food you eat. You should really get to know it before you eat it!
As I eluded to before, the food you put on your plate has a backstory. By purchasing it, you support it and the people who helped it get there.
I don’t expect the answers for this broken system to come from Washington, D.C. Although that would be nice, the best way to fix it is to support the small farmers and butchers. Our farm does its best to support all of the small farmers and other businesses we can. That way, you can be proud that your food is making a difference in the lives of not only us, but the whole community.
There are many small farms and businesses that need support. All of which have their own story and their own desire to help you and your family become happy and healthy once again. By shopping from these farms, you don’t just support them, but the entire food system, helping eliminate the volatility and risks of food scarcity that come from the consolidation of food production.
I want to leave you with some encouragement: you can make a difference by educating yourself about how your food gets to your plate and by telling a friend about the challenges facing American farmers and ranchers and the effects they will have on their food. Most importantly, I want to encourage you to take the time to get to know your farmer, understand your food, and recognize the impact you're making on the world.
