By Steve Karnowski
MINNEAPOLIS (AP) – South Dakota rancher Kari Williams wants to win cash at a time when retail beef prices are at an all-time high and consumers are still willing to pay. But that’s not that simple.
Williams and her husband Tate raise about 70 cows and carbohydrate pairs near Letcher in southeastern South Dakota, about 18 miles (29 km) north of Mitchell. They own about 80 acres (32 hectares) and rent additional pastures.
She said that she is still unable to make the financial investment needed to raise production, as land prices are rising, with maximum limits on grass available to feed animals during the droughts that have hit cattle nations hard over the past few years.
“Our goal is to expand,” she said. “I don’t know if that’s in a 10-year plan or if it’s going to be any more.”
Biology is a barrier to expansion
Farmers and ranchers across the US want to make more use of the high prices, but US herds are unable to meet demand immediately at record low prices. It’s basic biology.
“We’re looking forward to seeing you in the future,” said Michael Swanson, chief agri-food economist at the Wells Fargo Agri-food Institute in Minneapolis.
The drought has been alleviated, but the impact continues
Williams County has been hit hard by droughts over the past few seasons. With their grass shortage and insufficient hay prices, they had to sell all the young women last year who could have produced more calves than this year, she said.
However, their area has been raining lately. A recent US drought monitor report has improved “abnormal dryness.” But Williams said they were simply catching up.
Swanson said some of North America’s major cattle regions, from Saskatchewan and Manitoba in Canada to Texas in the US, are naturally prone to droughts. It’s often a boom or bust.
Colin Woodall, CEO of the National Cattlemen’s Beef Association, said many cattle countries had rain this summer, but it’s a circular business.
“Sometimes there are fun times, but sometimes we don’t,” Woodall said. “And we were hit so badly by the cattle industry in ’20, ’21, with the height of the pandemic, but we still have a lot of producers.
Fear of future droughts is also a factor
And Woodall said his members were still unsure. They ask how long the better weather will last.
“We’re getting some good water now. But will that be the case in the fall? Will it be next year?” he said. “The last thing you want to do is pay to rebuild your flock, and then you’ll need to liquidate them again in six months to a year.”
While it is difficult to directly attribute a single weather event, such as a drought, scientists say that rising temperatures caused by climate change have increased the likelihood of both severe drought and heavier precipitation.
When extreme weather collides with narrow edges, farmers and ranchers feel pressured.
Economics: Prices rose and recorded high prices
Retail beef prices have hit record highs so consumers can’t see. Ground beef rose to an average of $6.12 per pound in June, up nearly 12% since 2024. The average price for all steaks rose 8% to $11.49 per pound.
Additionally, the average price that producers receive for cows and calves has increased from $1.51 per pound in May 2020 to $4.05 this May.
But the herd is still shrinking
The herd of American cows is the smallest since 1973, and perhaps the 1950s, in the mid-year period since the government began to maintain those numbers. USDA data showed few indications released last Friday.
As of July 1, the US had 94.2 million cows and calves from its final peak of 103 million in 2019. Calf production in 2025, important for future supply, is projected at 33.1 million, down 1% from last year.
Derrell Peel, a livestock marketing specialist at Oklahoma State University, said USDA reports would indicate heifers if producers plan to raise herds.
However, consumer demand remains high
Retail prices are high, but so far consumers are willing to pay.
Glyn Tonsar, a leading meat demand monitor at Kansas State University, said taste is the most important consideration when choosing protein, and beef remains a favorite.
A report from late June found that consumers would be willing to eliminate $17.62 per pound on rib-eye steak and $8.82 per pound on ground beef. That’s over $7.13 you pay for pork chops, $6.19 for bacon and $8.55 for chicken breast.
According to Woodall, the main reason is that the beef industry focuses on the dietary experience.
“The kind of beef we produce today is the highest quality and best-tasting beef we have ever produced in history in the US,” he said. “So something like USDA Prime grades steaks and at some point you can only get it at restaurants, so you can get it at the grocery store.”
For consumers who accumulate at the expense, marketing specialist Peel said pork and chicken were “a rich and very advantageous price.”
Meanwhile, back to the ranch
34-year-old Williams built the TW Angus business from scratch. Tate Williams began buying cows when he was in high school, and in 2015 he bought the land. They sell bulls in the spring and keep heifers wherever possible. They also raise steer at their feedlots and sell meat directly to consumers.
“We really want to expand our operations,” Kari Williams said. “We have a goal to be able to pass this on to the next generation,” Williams said.
But remembering what a friend said, she said the rancher was a resilient bunch.
“We are optimistic that if Mother Nature wreaked havoc on us, whether it’s a drought or a flood, she will be kind to us,” she said. “Or if the market wasn’t on our side, we’re optimistic that the next market will be on our side.”
Original issue: July 31, 2025, 11:59am EDT
