The Challenges of Expanding Beef Production Amid Rising Prices

MINNEAPOLIS (AP) — As retail beef prices reach unprecedented highs, South Dakota rancher Calli Williams eagerly anticipates the opportunity to benefit from these trends. However, the complexities of cattle farming make this aspiration more complicated.

Local Farm Profile

Williams and her husband, Tate, manage about 70 cow-calf pairs on their 80-acre ranch near Letcher, located roughly 18 miles (29 kilometers) north of Mitchell. Despite the favorable pricing in the beef market, they face numerous barriers to increasing their production capacity.

Biological Constraints to Growth

Farmers across the United States are eager to capitalize on the current high prices, yet they are unable to do so quickly due to historically low cattle herds. The timeline involved in cattle production is a significant hurdle: “It takes three years to increase your numbers — from the initial decision to calf production and rearing,” notes Michael Swanson, chief agricultural economist at Wells Fargo Agri-Food Institute.

Drought Effects Still Felt

Recent droughts have taken a toll on cattle-producing regions, including Williams’ area, which struggled under severe conditions in recent years. Due to inadequate grass and skyrocketing hay prices, they were compelled to sell all their young females last year.

Fortunately, improved rainfall has led to a shift from “severe drought” to “abnormally dry” in recent reports. Still, Williams believes they are mainly in a recovery phase.

According to Swanson, regions prone to drought — from Canada’s Saskatchewan and Manitoba down to Texas — illustrate the cyclical nature of ranching, where producers often navigate boom-and-bust cycles.

Lingering Fear of Future Droughts

Colin Woodall, CEO of the National Cattlemen’s Beef Association, emphasizes a creeping apprehension among ranchers regarding the sustainability of recent weather patterns: “While we’re enjoying good moisture now, uncertainty abounds about future conditions.”

Producers are wary of investing in herd expansion, only to face another drought that might necessitate liquidation. The confluence of climate change and unpredictable weather has only added to these worries.

Price Surge and Its Economic Implications

Consumers currently face record-high retail beef prices alongside a shrinking cattle herd. Ground beef surged to an average of $6.12 per pound in June — a nearly 12% increase since 2024. The average price for steaks rose by 8%, hitting $11.49 per pound.

In contrast, the total U.S. cattle herd stands at its smallest mid-year count since 1973. USDA estimates reveal 94.2 million cattle and calves as of July 1, down from nearly 103 million in 2019, with projected calf production for 2025 also declining.

Consumer Demand Remains Strong

Despite rising prices, consumer demand for beef remains robust. Glynn Tonsor from Kansas State University reports that shoppers prioritize taste, leading them to still prefer beef despite higher costs. Reports from late June revealed willingness to pay $17.62 per pound for rib-eye and $8.82 for ground beef.

Marketers like Woodall point to the industry’s focus on quality as a significant factor in consumer loyalty. “We now offer some of the highest quality, best-tasting beef in history,” he states.

The Williams Family’s Future Aspiration

At the heart of this narrative are the Williams family, who established their TW Angus business with determination. Owners of their land since 2015, they are committed to growing their operation and passing it on to the next generation, including their two young sons, Jack and Tommy.

“Our goal is to expand,” Calli Williams shares. “However, we’re navigating various challenges, hoping for a more favorable climate and market conditions.”

Resilience in Farming

Although the path ahead is fraught with uncertainties, Williams remains optimistic about the future. “We’re resilient,” she concludes, “and we believe that next year will bring better conditions, whether that’s through improved weather or more favorable market trends.”