(Mises)—In September 2023, we looked at the high price of beef and how big government has been bad for the American family budget. With stock indexes even higher, the situation for beef consumers is even worse.
In the US, the price of hamburger meat ended last year near a record high of $5.60 per pound. Just 5 years earlier—prior to covid—it was $3.88 per pound. From the early 1980s to 2000, hamburger meat averaged $1.50 per pound. That means that over that 40+-year period, hamburger meat is four times as expensive.
While that seems like a big increase—and it is—the rate of increase is only slightly higher than what the government claims has been the increase in consumer prices in general over the entire period as measured by their Consumer Price Index or CPI. So, beef has been a fairly accurate barometer of the impact of government and Federal Reserve policies undermining the household economy. The most rapid increase in beef prices and consumer prices in general have come in the aftermath of the Trump-Biden covid spending sprees and, of course, the vast money printing by the Federal Reserve unleashed in 2020.
Like most businesses, raising cattle and related businesses have faced significant increases in costs due mostly to inflationary forces. Grains used to feed cattle are impacted by monetary inflation. There was a huge upward spike in grain prices from the Fed’s covid monetary inflation. Often blamed on Russia’s invasion of grain-producing Ukraine, grain prices actually peaked around the time of the invasion, leveled off, and even subsequently declined as the world economy contracted. Even though grain prices have retreated, herd size must have come under enormous pressure with the covid inflation as grain price surged, herd size retreated. Beef consumption also retreated in the post-GFC inflationary contraction.
With prices relatively high, and grain prices and herd sizes having retreated, beef producers are in a temporary sweet spot, but consumers and others along the supply chain, such as processors and wholesalers remain soured. It is a tough competitive business, subject to the cycles of uncertainty.
Another largely-unnoticed inflationary impact on beef supply and prices is the Fed monetary policy. The Fed has been suppressing interest rates for decades and causing price inflation. They did it again during covid on a massive level and have only recently tried to “normalize” interest rates.
Every real estate agent, broker, dealer, and investor knows that interest rates are the major key to the real estate market. One aspect that I explored in my book, the Skyscraper Curse (free HTML, PDF, or ePub download here) is that artificially low interest rates increase the demand to buy land and this causes land prices to increase. Higher land prices mean that some land used for cattle might have been purchased and developed into different uses or land that could be used to expand cattle ranching might simply have been too expensive to purchase and convert into cattle production.
It is possible to produce cattle and beef with very little land, as the Japanese famously do. However, economically speaking, it is much cheaper to produce cattle on grass and pastureland if that land is superabundant and close to market. You need far less land if feed corn and other grains were superabundant. However, the current circumstances are that land is scarce and high-priced and feed grains are also expensive and might get even more expensive. Both of those market conditions are driven, in large part, by the Fed’s monetary inflation.
I also suspect government intervention on behalf of the environmental terrorists might be playing a role. These are “angry” people who think that cow farts are a catastrophic problem, and that we all should be forced to follow their personal dietary philosophies, such as vegetarianism or veganism. This has certainly crippled the industry in Europe, which has experienced drastically restricted consumption and high prices. This should be opposed.
The beef industry—including all the processing and final product sectors—also faces a consumer base that is experiencing declining inflation-adjusted incomes. The net result is that fewer Americans even bother stopping at the meat counter, pick cheaper cuts of beef, and opt for pork, chicken, and other cheaper protein substitutes.
The US beef industry is in the midst of one of its largest two-year declines in beef production. This will have significant ramifications for everyone from consumers to cattle producers. Consumers will face higher retail prices than they did in 2023.
Per capita beef consumption in the US has been on a relative decline since we were taken off the Bretton Woods Gold Standard, but in the last couple of years there have been significant declines. With reduced herd sizes and prices sky high, that decline seems unlikely to be reversed in 2025. We may get some relief in the intermediate term, but I fear the long-term nutritional decline that current trends dictate.
Based on my own anecdotal evidence, the high price of beef steaks and roasts makes people grumpy. It also undermines health because beef meals are highly nutritional and provide very high-quality protein. I personally don’t accept the government’s public relations campaign against beef and butter.
One thing is for sure, Americans followed the guidelines, but the expected results did not materialize, quite the contrary. Diabetes and obesity are at all-time record highs. Heart attack deaths have declined, but surely most of that is due to better detection and care, the hundreds of thousands of bypass and stent operations every year, and better emergency medical services.
Is there a magic wand to solve the problem of high beef prices, as well as high pork and chicken prices? Actually yes, begin by returning to the gold standard or at least don’t allow the Fed to target interest rates or increase the money supply. Remove the wild swings in the market and make investment more certain. The second day, release vast amounts of federally-controlled land and eliminate the ethanol program that diverts corn into our gasoline. Peace in Ukraine and the Middle East would unleash more food and fuel for the human population and this translates to improvements for the people directly impacted and to the general world population. Also, pursue efforts to roll back environmental restrictions and open up oil and gas production, which will reduce farming and fertilizer prices, as well as increase production and jobs generally.
All of this combined would drive up people’s real incomes, greatly reduce the cost of beef, and stimulate beef production. Within one production cycle, the American family would be back to their once-a-week steak nights.
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Two Storms, One Harvest
Every food crisis in living memory has been a one-shock event. The 2008 price spike was a commodity bubble. The 2020 shortages were a logistics failure. The 2022 grain scare was a war on one exporter’s ports. Each time, the system bent, adjusted, and recovered, and each time the experts assured us afterward that global markets are simply too big and too diversified to fail.
What nobody in Washington seems eager to discuss is that 2026 is shaping up to be something the modern food system has never actually faced. Two independent shocks, one climatic and one geopolitical, are converging on the same harvest cycle at the same time. Not sequentially. Simultaneously.
Start with the weather. The Pacific Ocean is currently building toward what forecasters now openly call a record event. NOAA’s Climate Prediction Center puts the odds of at least a strong El Niño near 88 percent, with roughly two in three odds it reaches “very strong” status, the tier reserved for perhaps three or four events in the entire satellite era. Every major global model now projects a median peak in Super El Niño territory, and most of them project it exceeding the 2015-16 event, which until now held the modern record. Sea surface anomalies were already brushing the super threshold in mid-July, months before these events normally peak. The atmosphere has already shifted into El Niño mode, and the event is forecast to crest in late fall and early winter.
This is not about “climate change.” It’s about the standard cycles of weather, and the cycle we’re currently in is one that has likely devastated societies in the past. We’re better prepared as a society today, but not all Americans are equally prepared.
Serious households have started doing the quiet math on their own. Grocery bills tell part of the story, and the forecast maps tell the rest, which is why long-term food storage has moved from fringe hobby to mainstream line item in the family budget, with established suppliers like Heaven’s Harvest seeing demand from people who five years ago would have rolled their eyes at the idea. That instinct is not paranoia. It is pattern recognition, and the pattern is worth walking through carefully.
Editor’s Note: Heaven’s Harvest IS a sponsor, but the warnings of this article are real and would be written even if we didn’t have a survival food sponsor. With that said, those who take advantage of what they offer can use promo code “Patriot” for 15% off.
The Fertilizer Clock Is Already Running
While the Pacific warms, the second shock has been unfolding in the Strait of Hormuz. The conflict with Iran turned the world’s most important energy chokepoint into a contested waterway, and the consequences reach far beyond the gas pump. Roughly a third of global fertilizer trade moves through Hormuz, and the disruption sent urea prices up 86 percent year over year by March, with a 53 percent jump in a single month.
The World Bank projects energy prices rising about 24 percent in 2026 and fertilizer about 31 percent. By its own accounting, fertilizer prices ran 35 percent higher in the first five months of this year than the same period last year.
Here is the mechanism the nightly news will not explain. Fertilizer is not a grocery item. It is a time-delayed input. The nitrogen a farmer in Iowa or Punjab could not afford to apply this spring does not show up as a problem this spring. It shows up as a thinner harvest six to twelve months later.
The World Bank’s own food security brief concedes that the effects of reduced applications earlier this season “are likely to become visible only later in harvest outcomes.” Translate that from institutional language into plain English and it means this. The damage is already done, it is already in the ground, and we are simply waiting for it to arrive on the shelf.
Now check the calendar. Six to twelve months from the spring planting season lands us squarely in late 2026 and early 2027. Which is precisely when the strongest El Niño in the instrumental record is forecast to peak, bringing its signature droughts to Southeast Asia, Australia, southern Africa, northern Brazil, and South Asia, the very regions that grow the world’s rice, sugar, and oilseeds.
The World Bank warns openly that a strong El Niño “could disrupt multiple crop belts simultaneously” on top of the conflict-driven input costs. Their baseline projection assumes the Middle East disruptions ease by autumn. What in the last two years of Middle East history suggests that assumption is safe?
The System Has No Slack Left
The comfortable answer is that global markets always adjust. But adjustment requires slack, and the slack is gone. Global cereal production is expected to decline from last year’s records even before El Niño does its work. The UN World Food Programme, hardly a den of right-wing preppers, is calling this the most significant disruption to its supply chains since Covid and the invasion of Ukraine, and its supply chain director put the stakes bluntly.
Today’s supply chain challenges are tomorrow’s hunger crisis.
There is also a political dimension that markets cannot price. When food gets scarce, governments do not behave like economists. They behave like politicians. Export bans, hoarding mandates, and panic buying at the national level turned the modest rice shortfall of 2008 into a global crisis, and analysts are already warning that import-dependent nations are the first dominoes.
The 2015-16 Super El Niño, a far weaker event than what is now forecast, threw tens of millions into food stress across Africa and Asia. This one is projected to be stronger, and it arrives with fertilizer already rationed by price and shipping lanes already contested by missiles.
What Joseph Knew
Scripture does not treat preparation for lean years as faithlessness. It treats it as wisdom delivered in advance to those willing to act on it.
Behold, there come seven years of great plenty throughout all the land of Egypt: And there shall arise after them seven years of famine; and all the plenty shall be forgotten in the land of Egypt.
Joseph did not respond to that warning with a hashtag or a committee. He stored grain during the years of abundance, and when the famine came, Egypt stood while its neighbors begged. The lesson is not that famine is certain. It is that the time to prepare is precisely when preparation still looks optional.
Nobody who filled a pantry in a year of plenty has ever regretted it, and nobody standing in an empty aisle has ever been glad he waited for certainty.
None of this calls for panic, and panic is the enemy of sound judgment anyway. It calls for the same unglamorous prudence our grandparents considered ordinary. Keep some cash margin, know your local growers, and put real food in deep storage while it is cheap and available, because the entire arc of this story is that cheap and available is a closing window.
Families looking for a straightforward place to start can visit Heaven’s Harvest and use promo code Patriot for 15 percent off long-term storable food. The forecasts may yet soften, the strait may yet reopen, and we should pray they do. But hope is a fine thing to hold and a foolish thing to eat.
