– James Mitchell, Livestock Marketing Specialist, University of Arkansas
Beef prices are much higher this year and are expected to increase over the next several years as U.S. beef production decreases. Data from the U.S. Bureau of Labor Statistics shows All Fresh Retail Beef prices averaging $8.48 per pound through July 2025, up $0.53 per pound from the same period last year. Understandably, higher beef prices have raised ongoing concerns about consumer demand, a topic that comes up frequently in cattle market discussions and Extension meetings.
Data Source: USDA-AMS
I know this may seem like a subtle nuance, but there is an important difference between a change in quantity demanded and a change in demand for beef. A decline in beef consumption because prices are higher is a change in quantity demanded or movement along the demand curve. This is simply the law of demand: when the price of beef rises, the quantity demanded falls, holding all else constant. By contrast, a decline in beef demand means the entire demand curve shifts inward due to factors such as lower consumer incomes, shifts in preferences, or changes in the relative prices of substitute proteins like chicken and pork.
A key factor for future beef demand is how price competitive beef remains relative to other proteins. The second graph in this article (below) plots the beef-to-chicken and beef-to-pork price ratios from January 2020 through July 2025. A higher ratio is a signal of a decline in the price competitiveness of beef. A lower ratio, by contrast, indicates beef is relatively less expensive compared to other proteins and more price competitive.
During the period shown in the graph, the beef–chicken price ratio has held mostly between 3.9 and 5.0, while the beef–pork price ratio has stayed between 1.4 and 1.8. These stable relationships over the last 24 months suggest that although beef is consistently more expensive than chicken and pork, its relative price position has not changed. A dramatic change in these relationships would be one signal of weakening beef demand.
Research shows that beef demand is relatively price inelastic. This means that a percentage increase in price results in a smaller percentage decrease in quantity demanded. As a result, total consumer expenditures on beef (price times quantity) often rise when prices increase, even if consumption volume declines. The total dollars spent on beef is more important to the industry than price or quantity by themselves (see graph below).
