U.S. cattle producers have had to navigate some tough conditions over the last several years. Some cattle ranchers saw the record-high cattle prices back in 2024 as an “opportunity” to exit the business, said Walter Kunisch, lead strategist at HTSCommodities, a division of Hilltop Securities. He also noted that, at the same time, there was a liquidation of female cattle that could have been used to breed more inventory.

"What we’re seeing right now in 2025 is the 'residual impact' from that — a sustained, acute, structural supply deficit of beef cattle in the United States,” said Kunisch.

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