Missy Bonds is banking on a wet fall and spring for her family鈥檚 ranch near Saginaw. Business depends on it.
Running cattle means constantly keeping an eye on how much pasture the animals have to graze and how much water they have to drink. Bonds was able to manage the herd through the summer, but a nearlythrew things into uncertainty.
The area still looks as if the fire happened yesterday, Bonds said. Not enough grass or water could mean the ranch has to sell some of their cattle.
鈥淧eople are at this point 鈥� we鈥檙e down to kind of just the bare minimum,鈥� Bonds said. 鈥淭rying to hold on to what they can.鈥�
Pressures from years of widespread drought and rising costs of raising cattle are forcing ranchers in North Texas and across the U.S. to manage smaller herds. Beef production is expected to decline by 24.7 billion pounds, a historic low, With fewer cattle being raised, experts say consumers should expect the price of beef at grocery stores to rise to new highs.
A major culprit for raising fewer cattle is drought.
Almost the entire western half of the country experienced drought conditions last year, according to the . This year, the is experiencing abnormally dry to exceptional drought conditions this year, according to the monitor.
David Anderson, a professor of agricultural economics and extension economist with Texas A&M University AgriLife Extension, said the drought conditions forced ranchers across the country, including in Texas, to reduce their cattle herd.
鈥淐ows are out on grass and ranges and pasture,鈥� Anderson said. 鈥淚f it doesn鈥檛 rain, you don鈥檛 get any grass. And so you can鈥檛 have as many cows.鈥�
Economic conditions, such as high fertilizer prices and a lower selling price during the pandemic, also caused ranchers to reduce herds. Those factors are reflected in sale prices. The average price of a steak across cuts in August was $7.65 per pound, according to the Bureau of Labor Statistics. That鈥檚 slightly down from the all-time high from July, Anderson said, but consumers can expect the prices to remain high.
鈥淭ighter supplies yet continued demand for the product by consumers has kept that retail price high,鈥� Anderson said.
Every week, Kimberly Irwin, co-owner of , has seen higher sales of cattle than normal. A normal sale would see about 1,200 head of cattle 鈥� but she said she can regularly see up to 2,200 now.
It鈥檚 not only a lack of green grass that鈥檚 spurring ranchers to sell. Available water is an issue, too. Groundwater tanks started to dry last year and never recovered. This summer, many rancher鈥檚 already low wells ran out, she said. Many ranchers sold their old cows first, in hopes of having a young herd to keep going forward. But she said many ranchers are selling young calves now to survive. Irwin, who has been running the market for 20 years, has seen droughts come and go over the years. This time is different.
鈥淚 haven鈥檛 seen it last this long 鈥� because it鈥檚 two summers in a row,鈥� Irwin said. 鈥淚t鈥檚 been real bad. It鈥檚 been bad before, but then we recover by the next spring.鈥�
Less supply for cattle means ranchers are ultimately getting paid more, and processors are paying and selling the meat for more, Juan Alfonso Ramos, CEO and owner of , said.
鈥淲e charge a higher price than we would have in the past because our costs are higher,鈥� he said.
Ramos, whose family owns a ranching company that operates in Texas, Oklahoma, New Mexico and Mexico, said drought conditions have posed a challenge. While they haven鈥檛 had to sell their cattle, they aren鈥檛 expanding either.
They have gotten rain in their area, which has relieved some pressure, he said. But while some places have gotten much-needed moisture to their pastures, he notices while driving across West Texas, New Mexico and Oklahoma that most places are dry. The longer it takes to replenish herds, the longer the higher prices will persist, he said.
鈥淚f we don鈥檛 have heifers turning into cows, to then have calves and then further regrowing the herd, it鈥檚 going to continue to be a very difficult situation for the live cattle herd to regrow,鈥� Ramos said. 鈥淎nd that鈥檚 going to continue to put upward pressure on cattle prices 鈥� and meat prices for the consumer.鈥�
Seth Bodine is a business and economic development reporter for the Fort Worth Report. Contact him at seth.bodine@fortworthreport.org and follow on Twitter .
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