Cattle price records continue falling, despite swirling volatility in equity and futures markets tied to uncertainty around U.S. tariffs on key trading partners.

The weekly weighted average five-area direct fed steer price was record high the week ending May 2 at $220.97/cwt., according to the Livestock Marketing Information Center (LMIC). That was $35.23 more (19%) year over year. What’s more, this year’s peak fed steer price may still be a couple of months away if prices follow a similar course to 2024, say to LMIC analysts.

USDA’s Economic Research Service pegged the average annual five-area direct fed steer price at $206/cwt., in the April World Agricultural Supply and Demand Estimates.

Beef production was projected 288 million pounds less than last year (-1.1%) at 26.7 billion pounds. For the week ending May 9, year-to-date estimated year-to-date estimated beef production of 9.3 billion pounds was 249.5 million pounds less (-2.6%).

Calf and feeder cattle demand remains stellar

Cattle feeders, stockers and backgrounders remain aggressive buyers of dwindling cattle supplies.

USDA’s Economic Research Service increased expected feeder cattle prices for the remainder of this year, in the latest Livestock, Dairy and Poultry Outlook.

Based on price data through early April and weaker expected first-quarter feedlot placements, compared to the previous month, forecast prices increased $7 in the second quarter to $280/cwt., $8 in the third quarter to $282 and $7 in the fourth quarter to $286. The annual average price increased $6.28 to $281.03. Prices are basis Medium and Large #1 steers weighing 750-800 lbs., selling at Oklahoma City.

ERS analysts note 15% fewer calves and feeder cattle traded at auction, direct and via video-internet during the first two months of 2025 than the same period last year, as reported in the National Feeder and Stocker Cattle Summary.

“This is likely due to a 75% year-over-year decline in feeder cattle imports due to restrictions on cattle from Mexico over the first two months of the year,” ERS analysts say. “This has led to feedlots in Kansas and Texas placing 5% and 21% fewer cattle, respectively, in January and February, compared to the same period last year.

That was before the U.S. shuttered the Southern border to cattle, bison and horses once again May 11 due to the spread of New World screwworm

“The protection of our animals and safety of our nation’s food supply is a national security issue of the utmost importance,” says U.S. Secretary of Agriculture Brooke L. Rollins. “Once we see increased surveillance and eradication efforts and the positive results of those actions, we remain committed to opening the border for livestock trade. This is not about politics or punishment of Mexico, rather it is about food and animal safety.”

Looking further ahead, the recently released U.S. Agricultural Market Outlook from the Food and Agricultural Policy Institute at the University of Missouri projects peak cattle price in 2027.

More specifically, the outlook pegs the five-area direct weighted average fed steer price rising to $198.19/cwt. in 2027 and then declining to $169.29 in 2034. Likewise, steer calf prices (600-650 lbs., Oklahoma City) are projected to rise to $307.21 in 2027 and then declining to $250.54 by 2033.

The Outlook provides projections for 2024-2034, using data available in January of this year.

For broader context, the projections peg the U.S. beef cow herd at a low of 27.8 million head when 2026 begins and then growing to a peak of 30.6 million head in 2031 before declining to 29.1 million head in 2034. 

Herd expansion prospects improve

Recent rains in the Southern Plains brighten herd expansion prospects for the region, according to Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his early-May market comments.

Peel explains heifer retention could come with increased unplanned (impulse) breeding of yearling heifers that were categorized as “other” heifers in the Jan. 1 Cattle report rather than as “replacement” heifers.

“Historical data shows that an average of roughly 13% of ‘other’ heifers is typically bred each year as part of the total bred beef heifer supply the following January,” Peel says. “During the last herd expansion from 2014-2019, this percentage increased to over 18%, meaning that an additional 300,000-400,000 head of heifers were diverted from the feeder supply to breeding for the cow herd. A slower pace is expected in 2025, but impulse heifers breeding is likely to increase this year.”

Of course, beef producers can also expand the herd via increased retention of heifer calves. Peel explains these would be generally available to breed in 2026 and enter the cow herd in 2027. He notes fall-born heifers weaned in the next couple of months could be bred in late 2025 and calve in the fall of 2026.

“Heifer retention may be starting but the pace appears to be relatively slow, certainly much slower than the last herd expansion a decade ago,” Peel says. “If heifer retention is accelerating, the most immediate impact will be reduced feeder cattle supplies available for placement in feedlots.” 

U.S. beef exports hold fast

U.S. beef exports continue to show resilience, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF). 

Beef export value in March was the highest since June, up 4% year over year at $922 million, while export volume of 109,330 metric tons (mt) was 1% higher. Export value per head of fed slaughter was 3% higher year over year and the seventh highest on record at $466.77. First-quarter export value per-head of fed slaughter was also up 3% at $421.56.

“Despite a great deal of uncertainty, global demand for U.S. beef remains robust and resilient,” says Dan Halstrom, USMEF President and CEO. “The March export results confirm this, with demand trending higher in Taiwan and Mexico, reaching record levels in Central America and holding up well in Japan and Korea. Although we anticipate that China’s retaliatory tariffs and expired plant registrations will have a more drastic impact on April and May exports, the U.S. industry’s efforts to diversify markets and broaden U.S. beef’s global footprint are definitely paying dividends.”