As of February of 2026, the United States cattle herd numbers reached its lowest level since 1951. As a nation, with only 86.2 million head of cattle in 2026, we're at a 75-year low. And friends, that's something for us to address.
It appears that American ranchers are right now in a long-term liquidation phase. Frankly, from everyone who I've talked to about this, American ranchers are being forced to either choose liquidation or face bankruptcy.
Also known in the cattle industry, as a "contraction phase" of the natural cattle cycle, that means producers are sending cows to slaughter rather than retaining them for breeding. The contraction phase, also known as a liquidation phase, can be a multi-year period where ranchers reduce the total size of the U.S. beef herd by selling more cows and heifers for slaughter rather than keeping them for breeding.
This phase generally lasts three to four years and is a direct response to low profitability, high production costs, or external factors like drought.
Again, it's all about ranchers going through a lot of economic pressure and stress over the lack of water and poor pasture conditions, which reduces the ability of ranchers to feed their herd, forcing premature liquidation; high feed costs, and inflation-driven costs often make it unprofitable to keep cows, forcing producers to sell; and a high rate of cows failing to get pregnant leads to increased involuntary culling.
So, with high slaughter rates, which is when a high volume of breeding cows and heifers are being sent to slaughter, combined with reduced heifer retention, which means instead of keeping heifers to replace older cows in the herd, ranchers sell them for beef, that reduces the potential for future calves. Do that too often, and the result is a decrease in total U.S. beef cow inventory.
Ranchers make these sorts of tough decisions for a lot of reasons, mostly, it has to do with reduced profitability. Because of low calf prices, the market becomes flooded with beef, which pushes prices down. Rising costs for feed, fuel, and fertilizer can make it unprofitable to hold-on to cows, especially if they are not producing high-value calves.
Of course, high interest rates is another huge factor for why American herd levels are at their lowest in 75 years. High interest rates discourage investment in expansion or to rebuild. In many cases, because of a money crunch, ranchers who face high interest rates on loans to rebuild their herd are forced to liquidate their assets to reduce their debt.
Ranchers make these sorts of tough decisions for a lot of reasons, mostly, it has to do with reduced profitability. Because of low calf prices, the market becomes flooded with beef, which pushes prices down. Rising costs for feed, fuel, and fertilizer can make it unprofitable to hold-on to cows, especially if they are not producing high-value calves.
Of course, high interest rates is another huge factor for why American herd levels are at their lowest in 75 years. High interest rates discourage investment in expansion or to rebuild. In many cases, because of a money crunch, ranchers who face high interest rates on loans to rebuild their herd are forced to liquidate their assets to reduce their debt.
As for replacing aging or inefficient cows? In one respect, liquidation does allow a rancher to cull older cows, or those with poor health, which in the long run should help improve the genetic and productive potential of the remaining herd.
As for involuntary culling? That's when a rancher has a high rate of infertility, which are cows that are "open" or failed to conceive. Involuntary culling can often drive down a rancher's herd size. It's just not profitable to keep them.
While researching this subject, I've talked with ranchers both big and small. And while I mentioned some aspects of their economic troubles above, there's no getting around the fact that droughts have gone on for a few years in major beef-producing states such as Texas, Oklahoma, and Nebraska. In some cases, those droughts have forced ranchers to sell off cattle because of a lack of water and grazing land.
Right now, as of May of 2026, it's said that nearly three-quarters of the U.S. cattle herd is being impacted by significant drought conditions.
Widespread drought forces rancher liquidations because they simply cannot maintain cows due to lack of pasture, grazing land, or water. A lack of hay, or silage, makes it physically impossible or economically unviable to keep cattle through the winter. This forces ranchers into selling.
A lack of forage means more cost to the rancher. And, for the most part, the number one reason for cattle producers to liquidate their herds has to do with the soaring costs for fuel, feed, and transportation. It's hard to stay in business when it's a losing proposition. When the costs involved in maintaining a herd isn't profitable, that's going to lead to ranchers facing forced liquidation. That's the bottom line.
Widespread drought forces rancher liquidations because they simply cannot maintain cows due to lack of pasture, grazing land, or water. A lack of hay, or silage, makes it physically impossible or economically unviable to keep cattle through the winter. This forces ranchers into selling.
A lack of forage means more cost to the rancher. And, for the most part, the number one reason for cattle producers to liquidate their herds has to do with the soaring costs for fuel, feed, and transportation. It's hard to stay in business when it's a losing proposition. When the costs involved in maintaining a herd isn't profitable, that's going to lead to ranchers facing forced liquidation. That's the bottom line.
For today, because more cows are sent to market, the short-term supply of beef has increased. But, that's not a good thing because the long-term shortage because the liquidation of breeding animals means fewer calves are born in the following years. This leads to a sharp decline in beef production 2–3 years later. The cycle continues until the herd is small enough that reduced supply triggers high enough calf prices to make rebuilding (expansion) profitable again.
I'm told that the current cycle is unique. I'm told that as of early 2025, the cattle industry has experienced an extended "contraction phase" that dates back to 2019/2020. ) due to multiple years of drought and operating costs, leading to some of the smallest cattle inventory numbers in decades.
Here the irony, according to everything that I've been taught about this, this phase often happens when cattle prices are high. The high prices encourage producers to sell animals for immediate profit. Of course, by doing that, that shrinks the herd which eventually makes the number of cattle even a lot fewer -- which will also drives prices even higher.
From what I was told on this, the contraction phase is a natural cattle cycle that takes place as about every four years as a reaction to periods of ranchers over-expanding while trying to restore profitability when high costs, falling beef prices, or environmental constraints make maintaining a large herd unsustainable. This sort of liquidation occurs when producers reduce their breeding herd, by selling their cows and heifers for slaughter rather than keeping them for reproduction.
I'm told that the current cycle is unique. I'm told that as of early 2025, the cattle industry has experienced an extended "contraction phase" that dates back to 2019/2020. ) due to multiple years of drought and operating costs, leading to some of the smallest cattle inventory numbers in decades.
Here the irony, according to everything that I've been taught about this, this phase often happens when cattle prices are high. The high prices encourage producers to sell animals for immediate profit. Of course, by doing that, that shrinks the herd which eventually makes the number of cattle even a lot fewer -- which will also drives prices even higher.
From what I was told on this, the contraction phase is a natural cattle cycle that takes place as about every four years as a reaction to periods of ranchers over-expanding while trying to restore profitability when high costs, falling beef prices, or environmental constraints make maintaining a large herd unsustainable. This sort of liquidation occurs when producers reduce their breeding herd, by selling their cows and heifers for slaughter rather than keeping them for reproduction.
So now, let's talk about one more aspect of why as of February of 2026, the United States cattle herd has reached its lowest level since 1951. With only 86.2 million head of cattle in 2026, we're at a 75-year low.
Do I think there are legitimate reasons for this? Yes, I do. And now, we need to talk about the number one issue that all Americans should be concerned with in regards to this subject.
I wasn't exaggerating when I said that for the most part, the number one reason for cattle producers to liquidate their herds is the soaring costs for fuel, feed, and transportation. It's hard to stay in business when it's a losing proposition. When the costs involved in maintaining a herd isn't profitable, that's going to lead to ranchers facing forced liquidation. That's the bottom line.
The decline in cattle that we see today is driven by a combination of high costs, drought, government over-regulations which I will talk about in my next article, and a seriously shrinking workforce in ranching because our ranchers are getting older.
The average age of American ag producers is over 58, with 40% of producers over the age of 65. As these ranchers retire, many simply don't have the successors needed to take over. This is causing operations to either shut down or reduce size. And frankly, that's something for all of us to worry about.
Older ranchers are said to be less likely to invest in rebuilding their herds because it's expensive. That's especially true when it comes to long-term expansion projects. So instead, many older ranchers are preferring to sell herds rather than rebuild them during challenging environmental or economic times. Some ranchers are selling out all together to developers.
And besides the ranchers, there is the problem of finding workers. It's said that 87% of farmers report difficulty in finding necessary labor. And, since the livestock industry depends on manual labor for demanding, often dangerous work, ranching jobs are getting more and more difficult to fill.
The effect of older ranchers and lack of workers has has a huge impact on cattle production. As mentioned above, high operating cost in fuel and feed, rising labor costs, high interest loans, surviving government over-regulations, all combined, is forcing cattle producers to sell their cattle early. Yes, including selling their essential breeding heifers. This all leads to a smaller tighter supply of beef for America.
The combination of fewer ranchers and fewer workers means that the U.S. beef cow herd has dropped to its lowest level in over 70 years. Because rebuilding herds takes years, the challenges for the next generation of Americans is made worst by the high cost of entering the cattle industry. Just the cost alone of wanting to get involved in putting together a small herd is today preventing younger Americans from wanting to replace retiring ranchers.
The combination of fewer ranchers and fewer workers means that the U.S. beef cow herd has dropped to its lowest level in over 70 years. Because rebuilding herds takes years, the challenges for the next generation of Americans is made worst by the high cost of entering the cattle industry. Just the cost alone of wanting to get involved in putting together a small herd is today preventing younger Americans from wanting to replace retiring ranchers.
So what're the solutions to replace our aging ranchers? Well, we can start by focusing on recruiting Veterans and other younger Americans, increasing education in schools, create the equivalent of a trade school for ranching, leverage modern technology to assist younger ranchers, make ranching and farming economically appealing, structure low-interest loans for ranchers and farmers to keep them solvent, and maybe we can find ways to ease retirement transitions with interested people who want to step into a ranching operation.
We have to expand agricultural education in schools, and offer financial incentives to young and veterans who want to be producers. There is a lot of emphasis on computers these days. And yes, America is producing AI tech folks out the ying-yang. But frankly, AI can't produce cattle. And really, there is a ton of truth in the saying: No farmers -- No food.
So yes, Americans need to support educational programs to get young people interested in being producers. We can increase support for FFA and 4-H to encourage younger generations to enter agriculture. Also, we can develop apprenticeship programs that formally mentor those interested in becoming cattle producers.
Also, Veteran recruitment is a way to get Veterans who don't want to live in cities and deal with the urban sprawl into the country where they'd be happier. Speaking for myself, it would have been outstanding if something that like that was available to me when I completed my first active duty enlistment. We should try to connect interested Veterans to those who have the information they need. Utilizing training programs like the Farmer Veteran Coalition is a way to connect veterans with ranching jobs. All we can do is try.
Tom Correa
