The U.S. produces billions of pounds of commercial beef every year. But it’s getting more and more expensive for Americans to get beef on the table – and for ranchers to raise the cattle it comes from.

Guest

David Anderson, professor and extension economist for livestock and food product marketing at Texas A&M University.

Josh Maples, associate professor of agricultural economics at Mississippi State University.

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Transcript of Full Broadcast

The version of our broadcast available at the top of this page and via podcast apps is a condensed version of the full show. You can listen to the full, unedited broadcast here:

Part I

MEGHNA CHAKRABARTI: Walmart announced yesterday that it’s cutting the cost of ground beef by about 12%. It’s part of a seasonal pricing strategy that includes other products, but for Americans in the midst of grilling season, that drop in ground beef prices will be especially welcome.

However, it probably won’t make a significant dent because the cost of beef has been rising for the past decade now, with the sharpest jumps coming in just the past five years. I don’t know if you remember this, but back in 2021, the average price, the average U.S. price, for a pound of ground beef was about $3.95.

It hit historic highs this year, up to $6.90 per pound. Again, that’s the average U.S. price. So what’s driving this? Colorado rancher Jack Snell spoke with Rocky Mountain PBS in June.

JACK SNELL: But on years like this with no water, we don’t see any cows out here. Right now, they’re eating all of their winter pasture, so it’s tough.

CHAKRABARTI: As an industry tied to the land, ranchers have been weathering significant droughts for many years. That’s one reason. Another, the perceived utility of the land itself is changing. Alton Fowler, a Texas rancher whose farmland sits less than five miles away from a $700 million data center construction project he spoke with KWTX in June.

ALTON FOWLER: I never envisioned that this would be an industrial site. Even being able to sell, we feel like we’re between a rock and a hard place. We can’t operate the farm if the data center goes in, and we can’t sell because it’s coming in.

CHAKRABARTI: And then there’s the overall structure of the beef industry, one that has become extremely consolidated.

Just four companies control more than 85% of the U.S. beef market. They are Cargill, Tyson Foods, and Brazil-based companies JBS S.A. and National Beef Packing Company. Kyle Lyons is a rancher in Kansas.

KYLE LYONS: Over the years working for different neighbors and stuff like that, I was afforded the ability to work for bigger ranches and manage bigger operations.

And now we’ve stepped away from very large corporate ranch and now we’re trying to do this on our own, and this is very recently, within the last six months. When a corporate entity owns a ranch like that, they’re more about the numbers and the bottom line. They’re not actually there experiencing it and working with the animals and working with the land and seeing how some of the decisions that come down the line affect what the person there is actually doing.

CHAKRABARTI: Lyons has gone independent, and that means he has to build out his herd from scratch, and he has to start small, because it’s expensive.

LYONS: We’ve got the facilities, but it’s going to be baby steps getting into it, and the cost of cattle are so high right now. You go and buy, 20, 30 head of bred heifers [for] hundreds of thousands of dollars.

We don’t have a ton of financial independence to be able to just go purchase these with cash, so it’s probably going to be take out a loan from the bank, buy 20 or 30 head of heifers, bred heifers, calve them out, and then 100, 120 days later, sell them as pairs, and in that process we’ll be able to probably save one or two or three or four head that we would like to keep for ourselves.

So in that process, we’re building a cow herd very small amounts at a time, but without having to have the massive amount of loans or debt load while doing it.

CHAKRABARTI: And like ranchers in Texas and Colorado that you heard before, Lyons also has to worry about drought, disease, data centers, and anything else that could get in the way of raising healthy cows.

He’s even worried about AI technology that might take over some parts of his job. But to Lyons, the challenges are worth it.

LYONS: There is something, I don’t know, I find cows to be one of the most peaceful, slightly entertaining creatures there are. And those cows and those calves are our livelihood.

CHAKRABARTI: And because the beef industry is so intimately tied to climate, land use, global trade, geopolitics, the upward pressure on beef prices are a mirror of the pressures on American life.

And that’s what we’re going to talk about today. And joining us is David Anderson. He’s a professor and extension economist for livestock and food product marketing at Texas A&M, and welcome to you, David.

DAVID ANDERSON: Hey, it’s great to be with you. Thank you.

CHAKRABARTI: Okay. I just basically said that the beef industry is tied to every aspect of American life, both domestic and international. I do actually believe that, but I also know it’s an overly broad statement. So what would you say are right now the bucket of major drivers that continues to make prices go up for not just ground beef, obviously, but all kind of cuts that people can buy at the grocery store?

ANDERSON: I think we have two major drivers, and you’ve touched on the supply side of things, drought, higher costs just whether it’s feed, fertilizer, fuel, higher interest rates.

Plenty of people borrow money to operate on, to buy new cows or heifers with, and rates are higher and so our costs are higher. And you couple that with drought, and a couple of years ago we went through some periods with some very low prices, so we had ranchers losing money, drought, and our herds are the smallest since 1961 in the beef herd.

Now, that’s only part of the story because that’s the supply side. The other part that’s really important is that we’ve got growing consumer demand for beef, and have for a decade. People like beef. Even at these prices, it continues to, I think, deliver value for the dollar. But we’ve had growing demand for higher and higher USDA quality grades, think prime, Wagyu — things like that. Growing ground beef demand as all these regional hamburger chains have expanded nationally, the surge in gourmet hamburgers, so we’ve added that. And then you throw in just consumers’ demand for more and more protein in their diets, and that’s pulling beef along, along with the rest of the meats and dairy products and eggs, you name it.

That surge in protein demand is helping also.

CHAKRABARTI: Professor Anderson, Econ 101, dusting off my econ book here, says that when you have a rise in demand, an industry should kind of find an equilibrium point by also increasing supply. But that’s the opposite of what’s happening here.

ANDERSON: I think that’s right. We couple together these tighter supplies with growing demand, we get higher prices, and prices is the market signal, and I might say profits are the market signal to produce more. So why aren’t we producing more? And I think that gets at the earlier ideas that, for one thing, cattle graze out on pastures and rangeland and if it doesn’t rain, there’s no grass for them.

So that becomes a limiting factor. Higher costs, but still we have record high cattle prices, and that’s where, it’s just been a very slow expansion, because drought becomes that limiting factor in preventing us from growing. Even though prices might be telling us, “Hey, we need more beef production. We need more cattle.” But, if it doesn’t rain, it really keeps you from expanding.

CHAKRABARTI: Okay, so help me understand then. Let’s bring in the global economy here or international trade. Does the United States do a lot of importation of beef? How does non-domestic beef supplies factor in here?

ANDERSON: We sure do and it might surprise some of our listeners that the U.S. is a major exporter and importer of beef. And the key is, when we think of beef, there’s all these different cuts, and so we tend to export high value cuts that we have an abundance of, to places like Japan, South Korea.

Mexico and Canada are two of our biggest markets also for exports. So we export, but we also import, and the majority of what we import is really lean beef trimmings that go into ground beef to make more hamburgers. And so we are importing a record amount of beef this year. We imported a record last year.

We’re going to exceed that this year and I expect that we’ll exceed that again next year. And so we import beef.

We’re going to exceed that this year and I expect that we’ll exceed that again next year. David Anderson

CHAKRABARTI: And have those beef imports then been or the prices of those imports been hit by tariffs?

ANDERSON: They certainly have. Tariffs are essentially a tax on those products coming in, and so we do have a series of tariffs.

We also have some freer trade agreements, think USMCA with Canada and Mexico. But we’ve had tariffs at various levels on beef from Brazil. Brazil has become a major source of beef to us, along with Australia, New Zealand, again, Canada, and Mexico. So tariffs play a role in this, as well, in terms of increasing that delivered price of those beef items.

But even with tariffs and changing tariffs, even the tariffs that we’ve had for many years on imported beef, we’re still importing a record amount because we have very high prices. And so high prices attract more imports.

CHAKRABARTI: Yeah. Okay, so let’s go back to domestic stock, because you said that the cattle herds in the United States are the lowest in number that they’ve been since, what, the 1960s.

That’s a shocking fact here. Is that primarily because of what you talked about, the interest rates and the droughts, or is there also something else going on there?

ANDERSON: There is something else going on, and if we look back over the last 50 years, the trend has been fewer cattle in the U.S. because it turns out that our cattle are bigger than they used to be.

We produce more beef per cow. The calves are fed to heavier weights. We have selected, as ranchers, we’ve selected for bigger cows that produce more weight. And so we’ve had a long-term trend that’s upward in terms of beef production, even though it’s downward in terms of numbers.

CHAKRABARTI: Okay, so in that case then maybe those lower numbers aren’t something to be concerned about?

I’m just wondering why you raised that, as a fact that we should be aware of.

ANDERSON: Yeah. And it’s because the cattle industry is cyclical, and we think of a 10-year cycle in terms of cattle numbers. And it’s driven by biology and economics. The price signal gets people to expand their herds, and we expand till prices go down, and then we cut our herds.

But it takes, biology takes over and it takes time to produce that beef. And so the cattle numbers matter because as our cattle numbers go down, the number of head we produce goes down. Pretty soon weights don’t make up for that.

Part II

CHAKRABARTI: I’d now also like to bring in Josh Maples. He’s an associate professor of agricultural economics at Mississippi State University, and associate director of the MSU Extension Service, and he joins us from Starkville, Mississippi.

Professor Maples, welcome to you.

JOSH MAPLES: Meghna, thanks for having me.

CHAKRABARTI: All right, so you heard Professor Anderson a couple of minutes ago describe the strange economic dynamics of the beef industry right now, that prices are at all-time highs, but demand also keeps rising. So that to me implies that someone’s making a lot of money out there.

Who is it, Professor Maples?

MAPLES: That’s a great question, and these are fascinating markets to study right now. If we look at where the money is being made right now, I think it points back to something David mentioned. These price signals and in particular profit signals are really what drives the cycles that he mentioned earlier.

And so right now the cow-calf producer, this is the most profitable they’ve been in a long time. And that’s normal for where we are at this point in the cycle because it’s those profits that are ultimately going to incentivize them or spur them to start expanding their herds again, and that herd expansion takes a long time.

It’s something that is not quick. You don’t just turn it on. It’s a multi-year process for producers to start expanding again. So right now, cow-calf producers are making good profits, but that is just really a testament of where we are at this point in the cycle.

CHAKRABARTI: So for people who aren’t intimately familiar with sort of the various parts of the beef industry, can you just explain a little bit more, Professor Maples, when you say cow-calf producers? Are you talking about the individual ranchers that we heard at the top of the show? Are you talking about sort of corporate-owned production facilities, who you specifically mean here?

MAPLES: Sure, yeah. Typical cow-calf producer is probably what Americans think about whenever they think about cattle producers. It’s the majority family farms or family ranches that are raising cattle and they’re the ones that are actually, they have the cows, they’re producing the calves, they’re helping the cows raise those calves.

And then they keep the calves typically until they’re weaned, so think six months or so. And then at that point, the calves are separated from the cows. And then most of them enter the beef production system. The key point here in terms of talking about when do we expand is some of those calves are going to be heifers, that’s the girl calves.

Some of them are going to be bulls, which most of them will be turned into steers. But it’s that heifer piece that’s so important here because the producers have a choice. They can send those heifers into the beef production chain. They’ll go into a stocking or go out on pasture for a while, and then ultimately end up in a feedlot, and then from feedlots they go into the beef processing, beef packing sector is the next stage.

Or those producers can decide to keep back some of those heifers. Instead of sending them into the beef chain, they can keep them around for next year to hopefully be cows or to produce a calf the next year and become a cow in the herd. So it’s really that choice right there that there’s so much attention on right now because producers have this choice of, “I can sell this heifer now and make a lot of money for her because prices are good, or I can choose to keep her around and try to get her bred and get a calf out of her, and then make money off of her calves.”

But that’s two years down the road.

CHAKRABARTI: Okay. Professor Anderson, then, given that, let me turn back to you David. I was looking up some, I mean everything’s relative, right? Cow-calf producers might be actually making some more money now than they were before. But historically, when you consider about how much they make per pound of beef sold in the United States, I’ve been seeing some, like a different story.

I was looking up that some 50 years ago, ranchers got, what, 60 cents on the dollar of every consumer dollar spent on beef. And what, in 2022, 2023 at least, those are the numbers I could find, that number dropped to 39 cents on the dollar. So to me that seems like when you look at the beef industry overall, it’s the cow-calf producers, the ranchers are actually making historically less than they were before.

Is that right?

ANDERSON: That figure actually moves around. If we looked more recently than that data and calculated it up, the live, the people with the live animal would be getting about over 50%, 50, 55% lately. But I think you highlight a good point that moves around cyclically.

As Josh was talking about, the kind of the profits on the rancher side, the cow-calf side now, this is the time in this cattle cycle with tight numbers that ranchers do very well. But at the same time, this is the time in the cattle cycle that meat packers tend to lose money, and a lot of money.

And so that’s something we see in this cattle cycle historically. And we can go back just a handful of years, as you mentioned, and meat packers were making profits and ranchers were not. And so the cyclical nature of this industry extends to each of these segments that it’s very rare that every segment profits at the same time historically. And so now we’ve got meat packers losing money and ranchers making money.

CHAKRABARTI: Okay. This is so fascinating. Professor Anderson, you just mentioned the 800-pound gorilla in the room.

ANDERSON: (LAUGHS) I was afraid of that.

CHAKRABARTI: Or should I call it the 85% market share gorilla in the room. And those are those four major meat packers that do have control of the vast majority of the beef market in the United States. And just to remind folks, they’re Cargill, Tyson, we have JBS, and also National Meat Packing. The last two from based in Brazil.

Professor Maples, I would actually like to spend quite a bit of time with both of you on this issue because it keeps coming up, maybe cyclically, again and again. What role, Professor Maples, do you see the meat packing, those big four, playing in terms of the determination or influence over beef prices?

MAPLES: Yeah, they’re a key part of the industry, and there’s always pushback or disagreements between the different sectors, especially as David was mentioning, whenever one sector’s making money and the other one’s not, that creates tension. And in this industry in particular, there’s pretty much always, in the situation where one sector’s making it and the other is not making as much, so it creates persistent tension that’s been lasting for decades.

So yes, in terms of there are four large packers that make up the bulk of beef packing capacity, but it really is that capacity that becomes a key part of this discussion and less about, it’s important who owns the capacity but it’s also just important how much capacity we have.

So we don’t have to look back very far, look at 2020, 2021 where we had more cattle than we had the capacity to process, and I’m talking about across all packers, and that was a really tough time for cattle producers. Whenever there’s more cattle out there than the next stage of the production system can handle and so that led to some really depressed prices and tough financial times for cattle producers.

Now we’ve flipped it on its head. Now we’re in a situation where we’ve got more capacity to process cattle than we have cattle to process, and that’s really what’s turned this to where the leverage, if you will, is now in favor of the live animal producers, whereas five years ago, the leverage was in favor of packers in general.

CHAKRABARTI: Okay. Gentlemen, I have to say, you’ve hit my sweet spot here, because I spent quite a bit of yesterday and today diving into the federal registry. 100 years of regulation. … Oh, no, it’s really interesting. And it was triggered because of what both of you absolutely know about, and that was a recent announcement in May from the Trump administration that the Justice Department has an active antitrust investigation into those big four meatpacking corporations.

So just as a reminder, let’s listen to Acting Attorney General Todd Blanche at a press conference in May announcing the investigation.

TODD BLANCHE: Last November, the president tasked the department to investigate the costs and prices of beef. As a result, we prioritized investigating potential antitrust violations in U.S. cattle and beef markets.

In the beef industry, the big four processors control over 85% of the beef processing market. Two of the big four are primarily foreign-owned. Multiple plant closures across the country, the current market structure, and high concentration in the industry indicate anti-competitive activity.

CHAKRABARTI: Okay, so Professor Anderson and Professor Maples.

Let me just first get your first responses to what the acting attorney general said there, and then, if you will, I’d like to take a walk with you through 100 years of regulation of the meatpacking industry. But Professor Anderson, let me start with you. Just your thoughts on the acting attorney general’s announcement from May.

ANDERSON: I would say that I’m fairly skeptical about this. And I think if we talk about some long, to review some of the research that’s been done in this area, and we think about this, I guess I’m pretty skeptical. But I would say, any time an industry, a big four control 85%, in this case of fed beef production, the meat packing of cattle coming from feedlots, then the potential may exist for some market power and maybe the ability to exercise that market power, thinking about a monopoly that drives up prices to consumers or drives prices down for producers.

But I think there’s some problems in the logic in this in terms of how this works out and can they really do this and where they can do it and maybe where they can’t.

CHAKRABARTI: Okay. So Professor Maples, then let’s go back in time because, again, this is such a, I really meant it when I say that the meat industry in this country is really reflective of American life in general.

And so I was looking back at the Packers and Stockyard Acts from 1921. So more than 100 years ago, there was already concern about fairness in the industry. Professor Maples, I don’t know if you want to talk about that or what that tells you about the meatpacking industry.

MAPLES: Yeah. One of my favorite quotes, and another ag economist at Oklahoma State likes to use this one, I think it’s a Wyoming rancher in the 1920s or ’30s that says, “This squall between the packers and the cattle producers should have blown over by now.”

And then that was 100 years ago, right? So it’s something that, again, there’s always going to be tension in this industry. And you bring up a good point, Meghna, that this concentration, really, happened, it really started getting initiated in ’60s, ’70s, and really showed up in the ’80s.

But there was tension here, there before that. So the concentration is absolutely something worth talking about and certainly in times of like we saw in 2020, 2021, whenever the leverage is in favor of not enough capacity. The packing sector has less capacity then there are cattle.

That’s when it really, you need to put a particular closer look. But this is something that has been a historical challenge. It’s gonna be a challenge in the future. And it’s gonna be highlighted by various points in these cycles that are going to continue to occur.

CHAKRABARTI: Yeah. Okay so this gets me to the other pattern that I kind of recognized as I was looking at all this history of government intervention with the beef industry. And it does seem the federal government multiple times over, not just in May of this year, has tried to, or at least said that it was going to make some kind of investigation into increasing consolidation in the meatpacking industry.

But it’s been largely intermittent, ineffective, incomplete. I don’t even know what you wanna call it. I was looking back at the June of 1996 Clinton administration, and at that time, David Turetsky, the deputy assistant attorney general of the Antitrust Division at the DOJ, he was in Missoula, Montana, and he gave a speech to the Montana Stockgrowers Association saying that in recent years, the Antitrust Division has conducted several investigations into the meatpacking industry, and he talked more about how they were going to start yet another investigation.

And to your point, Professor Maples, this comes after the beginning of all that consolidation in the ’80s. And he says, We’re watching the mergers. We’ve received reports on Cargill’s large meatpacking subsidiary, Excel, at that time. But that was 1996, and we’ve only had more consolidation since then.

Professor Anderson, we’ve just got a minute until our next break here. What do you think about that?

ANDERSON: 1996 is actually when the last really big study of market power, market conditions in meatpacking was done. And it was called the Red Book because it’s got a red cover on it. And so I think those comments at the Montana Stockgrowers were related to this report coming out.

It was a big research effort by a lot of our colleagues, Josh and I’s colleagues who worked in this area of market power in beef packing. And so there has been some research done, and most of the research doesn’t really support a lot of evidence of market power.

Part III

CHAKRABARTI: Professor Anderson, just before the break, you were talking about how back in 1996, the Red Book was published, and you said when talking about consolidation, there was not a lot of evidence to support market power. Can you clarify what you meant about that?

ANDERSON: Yeah. So the research that’s been done on monopoly power or market power or the exercise of it by meat packers to drive down prices to cattle producers, the research that’s there tends to show a little bit of decline, a little bit lower cattle price than otherwise.

But it’s a pretty insignificant number really which really tells us there’s not a lot of market power being exercised over time. That’s what the past research tells us. Now, we ought to think back, too, there’s a lot of history in this in terms of really a changing industry. The way cattle are sold from feedlots, cattle feeders to packers, has changed over time.

The technology in meat packing has changed. There’s been a change in this and I’ll give you a good example. Everybody’s seen the movie Rocky. When Rocky, when he’s training, he goes in the meat packer, and there’s these carcasses hanging, and he’s punching the carcasses.

We can think of that step in the process as a breaker. We used to have those everywhere, and what they did was they bought carcasses from a meat packer, and then they broke them down into the individual cuts and they went to your local meat market or grocery store or restaurant.

Over time, the meat packer themselves took over that process and then the steaks go in a box, and we ship boxes of steaks or boxes of briskets or boxes of ground beef to further processors or straight to your grocery store, and it shows up in the little styrofoam tray that we all see.

So there’s been a lot of just changes in the entire market system and anytime we have changes like that, that creates some more tension within the players in this industry. So there’s just been a lot of changes over time.

CHAKRABARTI: Okay. But Professor Maples I hear what both of you are saying in terms of maybe there isn’t enough evidence to say that consistently the Big Four are driving down prices for the producers.

But then I’m thinking really the endpoint being consumer prices. Repeatedly, the government has said that market consolidation has actually increased prices in the grocery store. It was back in 2020 that in the first Trump administration, the DOJ President Trump directly directed the Antitrust Division to investigate meatpackers because at the time, there was a price in cattle, a collapse in cattle prices as you had mentioned, but beef prices soared.

Now, I should say that investigation produced no major enforcement action, which is interesting, but the insinuation was that meatpacking consolidation is bad for consumers, Professor Maples.

MAPLES: Yeah, it’s a good question, a good point, and I’ll just highlight that this is something that administrations for about as far back as you can look have addressed or tried to address, or at least talked about.

It was only four years ago now that President Biden actually held a roundtable with his attorney general and producers, which is just kinda wild to think about the president talking about this issue, and then it’s continued. It was in the previous Trump administration, now we’re talking about it in this Trump administration.

You’ve already talked about how we talked about it in the ’90s. You can go back to the ’70s. Just I’m making the point here that this tension, and especially whenever you hit points where you have high consumer prices at a time of low cattle prices, or really just high consumer prices period, is gonna bring some attention to this.

So yeah, but the thing I will point to on these investigations, Meghna, is there’s been a lot of them, or at least, at least three over the past few years, because the one that started in the previous Trump administration continued through the Biden administration.

And just I think wrapped up right before this last one started again. So there’s always this continual investigation going on. And so if there are findings of abuse of market power, either towards ranchers or towards the food service or retail sectors I would think we would hear something about it, because I think there’s continually an eye on this sector, a lot of scrutiny.

CHAKRABARTI: Oh yeah. No, I completely agree with you. It might say more about antitrust law than the actual truths about the meatpacking industry. But you actually make the point I was just about to highlight a little bit more, that you’re exactly right.

There was that May 2020 investigation under the Trump administration, continued under the Biden administration. That ended in 2025 under the second Trump administration. Back in 2022, Professor Maples, as you were saying, President Biden also issued an executive order to create, quote-unquote, “a fairer supply chain.”

He wanted to pump money into expanding independent processing capability. It sounds like what you said earlier is now we have a lot of processing capability. And then it just keeps going back and forth, right? Because in 2025, President Trump rescinded some of that Biden executive order, then he announced a new DOJ investigation into price collusion, and now we once again have yet another DOJ investigation announced in May.

And then I saw that just this month, USDA announced its intention to rescind some modifications that the Biden administration had made to that Packers and Stockyards Act from 1921 that was intended to increase competition. I know that’s a big mouthful. But I guess, Professor Anderson, the point I’m trying to make is it seems like a lot of heat and very little light over many decades when it comes to how the government is trying to oversee the beef industry in this country.

What do you think?

ANDERSON: I think that’s true. And we could go back even further, I think some people would argue that the Antitrust Division of the Justice Department’s been underfunded since the early 1980s. And so the resources they have, they’ve used their resources on kind of bigger fish to fry than the than the beef side of things.

But, fundamentally, there’s a couple of questions we might ask and think about is, why do we have a Big Four? Why do we have relatively few really big packing plants? And I think the reason goes to economics. In meatpacking, there are large economies of size, and what that means is the bigger the plant is, the lower its cost of processing.

And so that lends itself to fewer, bigger plants over time. And so that’s really what we have is relatively few really big plants. And that gets us at this kinda structure of the meatpacking side. And then some of these policy things that you mentioned are really a feeling among a lot of people that maybe we oughta have more plants.

Maybe we oughta have more smaller plants, more local-type plants like we used to have many years ago. And so that fuels some of these policy things the dollars in terms of support to help new small plants get started and then the recent announcement of funding to help some of these small plants survive this period right now with very few cattle, and all beef packers are losing money.

And so that kinda starts the ball rolling. And but the thing to remember is, again the tough nut to crack is this idea of economies of size. Our biggest plants are our lowest cost plants, and so these smaller new entrants just plain have higher costs. It makes it tougher for them to survive, just economically because they got the highest costs.

CHAKRABARTI: Yeah no. Point well taken. It reminds me of the airline industry actually and a lot of that came along because with deregulation in order to facilitate business you get consolidation, which then creates those advantageous economies of scale for a fewer smaller excuse me, a fewer larger companies.

And actually, Professor Maples, this brings me back to something you had said earlier about now we have more capacity. Is it from the big four more processing capacity, or do we also have more independent processors? Because just reflecting back on that 2022 Biden executive order, I’m looking at it here, the executive order also promised to dedicate a billion dollars of American Rescue Plan funds for expansion of independent processing capacity.

Did that happen?

MAPLES: Yeah, there’s been some shuffling. So certainly we’ve seen some new processing come on that was supported by that plan. And it wasn’t just the federal support, that there were quite a few states that supported expansion of small, medium processing from their state funds.

And then we’ve also seen some of the big four Tyson in particular, we’ve seen them pull back within the past year. So they’ve closed a plant they’ve reduced some shifts in some plants. So we’ve seen some shuffling around. My point earlier about increased capacity is really relative to number of cattle.

And so if you think, our overall capacity, it’s changed a little bit, but probably hasn’t changed all that much, but we’ve got fewer cattle, and so we’re using less of that capacity that we have. But yes, we have seen some shuffling in terms of increased small and medium capacity relative to the big capacity.

CHAKRABARTI: Interesting. I could obviously spend many hours talking about market consolidation in the meat industry with both of you. But I’m not sure listeners would love that. One last note about JBS, one of the big four. Obviously, they are very politically engaged, let’s just put it that way.

Very large lobbying efforts on Capitol Hill, and also, I note that The New York Times reported that JBS made the single largest individual donation to President Trump’s inaugural committee. It was a $5 million donation, which is quite interesting. But in the last few minutes that we have, gentlemen, I guess really what people want to know is even though demand remains robust, those high prices do not feel great, especially in a time where people are feeling pinched.

Affordability is such an issue, and food affordability right there at the top of the list. Professor Anderson, what do you think it would take to bring the cost of beef down for consumers?

ANDERSON: I think the biggest thing will be herd expansion and being able to, and really some drought recovery, which allows us to expand our herds and increase beef production, and then we would end up with lower prices.

That runs into biology, and that leaves us a long time out for that to happen. But that’s really probably the best way that this is going to happen. There’s not a lot you can do from a policy standpoint to bring down prices.

If we were to have a big change in kind of consumer behavior where some of this demand, this growth that we’ve had pulled back, that would result in some lower prices. But I think the best thing that we could have is just expanding herds and growing production.

CHAKRABARTI: Got it. Professor Maples do you think that herd expansion could happen, especially given the things that I went over with Professor Anderson at the beginning of the show, the long-term drought, new, different, and more profitable uses for the land, those kinds of pressures that are actually maybe keeping herds smaller than they ought to be?

Can we get over those things?

MAPLES: Yeah, I do think we’re gonna get over ’em. I really expect us to expand again at some point. I don’t think this is the last cattle cycle, we’re just gonna keep getting smaller and smaller. But I think it’s that profitability response from producers.

And in particular, they have to expect not only that prices are good now, but that prices are gonna be good for them, profits are gonna be good for them two years from now, whenever they sell the calf from that heifer that they’re thinking about holding back right now. I think we’re on the cusp of that, and we haven’t seen very much of it in the last couple of years despite some strong prices, but I do think we’re gonna start expanding.

And there’s just not a whole lot from a policy standpoint that can be done to change that. Because any sort of incentive to try to get people to keep more heifers, would run into the point where that would actually reduce beef production in the near term because those heifers wouldn’t be going to the beef production chain. … And I think that’s one of the reasons we see as much focus on concentration. not that we shouldn’t focus on it and pay attention to it but a lot of times we run into it’s a really hard problem to tackle trying to spur expansion.

This article was originally published on WBUR.org.