Dec 22, 2025
Beef prices soar in the US and Europe due to supply constraints
Global beef production is entering a cycle of decline, as highlighted by recent reports from Rabobank and the USDA. The reports indicate that after five years of growth, global beef production is expected to decrease, with Rabobank forecasting a 3% annual decline by 2026. This trend is further confirmed by the USDA, which anticipates a 1% annual reduction, equating to a global production estimate of 61 million tonnes.
Production Challenges in Argentina and Brazil
Argentina and Brazil, two major beef producers, are experiencing significant shifts in production dynamics. Argentina is projected to see a slight increase in production by the end of 2025, despite a decrease in slaughter volumes. This is attributed to improved carcass weights. However, exports are expected to drop by about 5% compared to previous years. In contrast, Brazil is likely to achieve record export figures, even as production is forecasted to decline by 4.6% by 2026 due to increased cattle retention for herd rebuilding.
Impact on US and European Markets
In the United States, beef prices have reached unprecedented levels due to a historic low in cattle ready for slaughter. The USDA reported an 11% decrease in cattle numbers at major feedlots in November, prompting closures of several slaughterhouses. This supply constraint, coupled with high demand, has driven up prices for beef products. The US government has responded by lifting import tariffs on Brazilian beef to mitigate the price surge.
Similarly, beef prices in Europe, particularly the Netherlands, are expected to rise further next year. This is partly due to the reduction in livestock numbers driven by stringent environmental regulations, leading to fewer available cattle for slaughter. Consequently, Dutch consumers are increasingly shopping in neighbouring Germany for more affordable beef options.
Market Implications
The decline in global beef production and the resulting supply constraints are likely to keep prices high in the near term. With strong international demand and limited supply, countries like Argentina and Brazil may need to balance domestic needs with export opportunities. As the market adjusts to these new dynamics, stakeholders in the beef industry will need to navigate these challenges to maintain supply chain stability.