How we got here: Drought and high input prices
“Multiple years of drought and low profitability forced beef producers to shrink their herds in recent years,” said Wesley Tucker, MU Extension agricultural business policy specialist.
Cows need forage to graze in the summer and hay to eat in the winter. Several years of drought forced producers to make tough decisions. With limited forage options, producers had to sell chunks of their herd and were not able to retain heifers to replace them.
“A large section of the production factory – the cow herd – has been lost,” Tucker said.
High input prices also drove up the cost of production. Limited profitability gave producers little incentive to expand.
“Current beef cow numbers are the lowest they have been since 1961,” Tucker said.
Mexico and tariffs
New World screwworms have slowly migrated north from southern Mexico, forcing the USDA to close the border to cattle imports to protect U.S. cow herds from this parasite.
“Feedlots in southern parts of the country rely on Mexican cattle to keep feedlots full, so this further shortens the beef supply,” Tucker said. With the shrinking domestic beef herd, imports have become an important component to keeping grocery store shelves full.
As trade policy continually develops, the threat of tariffs could further affect available supplies.
Source : missouri.edu