Now that the government shutdown is over, reports are trickling back in with new data, and it’s caught a lot of people off guard. In recent weeks, the beef cattle industry has been in a hot and cold pattern. Some of the loud voices in the industry who have beat the Trump drum have quickly flipped their tone and questioned their support. Some that had claimed to have the president’s ear are now saying he hasn’t heard a word they’ve said.
The first and loudest to react are usually the ones without stability in their stance. They unfortunately gather a following based on shock value and fear mongering. We’ve become a society of immediate satisfaction and are impatient to wait for all the details to emerge. There’s a reason why the tortoise won the race.
Our industry depends on the consumer. Demand is at an all-time high—this isn’t news, it’s been reported, documented, talked about and dissected from every angle. We, as beef producers, are also consumers. We’ve had a dang tough decade to deal with, and we’re holding on to a good couple years. Fear of going back to 2015-20 doesn’t sound fun for any of us. We must remember the fundamentals are still in place. There are going to be corrections in the marketplace. We are in one right now. Let the market settle. New positions are being made by the paper traders, but the inventory is going to dictate where we go.
Paul Dykstra at Certified Angus Beef does an excellent job tracking carcass weights, beef trends and market data. In his “CAB Insider” newsletter, he’s been talking about this for years. Dr. Derrell Peel at Oklahoma State University has been saying the same thing. In fact, at a talk last year, based on carcass weights alone, his numbers showed that with overall beef production (pounds of beef produced), the industry was actually up 2% in 2023 over 2022.
This trend has only continued. This is from the feeders and packers utilizing low feed costs, marketing flexibility and the cattle’s genetic merit to stay afloat to maximize plant utilization to overcome lower head numbers. The latest carcass weights released recently continued to break the carcass weight records. This added weight is replacing the missing cattle, and the delinquency in pounds is made up in additional imports. We may not like it, but it’s what’s happening.
We have all seen what our inputs have done since the COVID-19 pandemic. It’s not cheap to run a cow. Luckily, there’s profit in it this year. CattleFax data this summer showed cow-calf profit of nearly $650/head this year. If the average herd, according to the USDA, is 47 head, that’s $30,550 profit for the average producer, which is not far off from a minimum wage salary. Granted, most of the people running 47 head aren’t making a living off the cows, but if we want the next generation to stay in the business, there needs to be a financial incentive regardless of herd size. My conclusion: cattle aren’t too high, but the consumer is getting pinched. There’s a huge disconnect with a lot of middlemen. Let’s talk about the consumer.
Similarly to what we have felt in the last month, uncertainty in a marketplace yields exponential volatility. This is never a good thing. The consumer is under a lot of pressure right now. Recent data shows a 4.4% unemployment rate, which is the highest since October 2021, but the positive news is that the economy added 119,000 jobs in September, beating expectations of around 50,000 jobs.
Consumers are in trouble, in my opinion. In Quarter 3 of 2025, the national credit card debt reached $1.233 trillion, up $24 billion from the previous quarter. This is a 5.75% increase from last year’s data. This means the average household in the U.S. carries about $9,326 in credit card debt at roughly 22.5% interest.
Car loan delinquency rates were at 6.65% in October. For reference, they were 3.8% in June of 2024. This data is worse than the Great Depression or the COVID-19 pandemic, according to a money.com article.
The Mortgage Bankers Association says delinquency rate in residential mortgages have increased 7 basis points from a year ago. The largest increase, including those in foreclosure, is Federal Housing Administration loans. This data is more difficult to decipher since there was an immediate spike in 2020-21 due to the pandemic.
Essentially, the consumer is being pinched on all fronts. In a recent Fox News article, Omaha Steaks CEO Nate Rempe said the nation’s shrinking cattle supply and record demand are driving a $10-per-pound reality. I feel there is uncertainty in the consumer indexes. Inflationary results are playing out as wages and salaries and trying to adjust to current conditions. In a time when it is so easy to run to social media to be the first to say something loudly, the damages only hurt your own people. A cowboy’s steady hand will calm the wildest horse, so why would he let his voice create more fear? It is a time to use a steady hand and continue to produce the best possible product in the best possible way. Keeping the public’s trust and support will be vital moving forward.
As we enter the holiday season, we wish a Happy Thanksgiving to all our WLJ family! — LOGAN IPSEN
