Persistent drought conditions have shrunk the U.S. %Cattle herd to its smallest size in 70 years, according to new agriculture data.
The steady decline of cattle is hurting meatpackers such as %TysonFoods (NYSE: $TSN) and leading to elevated beef prices throughout the U.S.
Meat producers had hoped that rains would encourage ranchers to begin rebuilding their herds after years of drought devastated pastures and forced farmers to send more cows to slaughter.
However, the hoped for rains have not materialized. Instead, drought conditions in the central and southern U.S. have worsened, leading to a further decline in the size of U.S. cattle herds.
Across the U.S., 62% of cattle reside in areas experiencing drought conditions, according to the U.S. Drought Monitor.
In Nebraska, America’s second-biggest cattle-producing state, ranchers say years of drought have turned once sprawling green pastures into dust.
Many cattle producers sow wheat in September to feed their herds, but drought this year delayed plantings and deprived ranchers of weeks of grazing.
The decline in cattle and rise in prices for them is harming meatpackers such as Tyson Foods, whose beef business is currently registering a loss.
The rise in prices for beef are also hitting American consumers hard. However, analysts say the situation is likely to worsen before it gets better as 2025 is looking to be a challenging year for the cattle and beef industry.