With production down, beef prices may increase

A smaller U.S. cattle herd may mean higher prices at the grocery store in the coming years.

Producers have reduced herd sizes in the past two years, largely in response to drought (read: increased feed costs), Lee Schulz, an Iowa State University extension and outreach specialist, told The Gazette.

Schulz estimates that growth in the herd may not occur until 2015 simply because it takes time to breed and raise enough cattle to make up for the decrease.

The U.S. calf crop was approximately 34.5 million in 2012, but with an estimated decrease of two to four percent, the 2013 calf crop may be the lowest since 1942. As herd sizes decline, the cost of beef may rise. In fact, the price of lean ground beef jumped 22 cents from November 2011 to November of last year, according to The Gazette.

During this past summer’s drought, the U.S. Department of Agriculture (USDA) declared 71 percent of the U.S. as disaster areas. Recently, USDA designated almost 600 counties as  natural disaster areas.

For more on the drought, click here.

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