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You probably know beef is getting more expensive, but do you know why? Let's take a look at the meat aisle in this grocery store. It seems like you have plenty of options, but most of this beef is processed by just four companies. Together, they control about 80% of the market. I call them the beef cartel. The big four haven't been convicted of any wrongdoing, but the Department of Justice is investigating how this kind of consolidation impacts what you pay, not to mention antitrust and collusion lawsuits from retailers like Target and McDonald's. A pound of ground beef cost about $6.89 in the US on average. That's 80% more expensive than in 2019. For US cattle ranchers, you'd think high
retail prices would at least translate to more profit. But they say they're feeling the squeeze, too. The more them industries consolidate, the easier it is for them to up the price and cut us out. Droughts, high production costs, and fewer cows are pushing prices up. But that's not the whole story. We follow the supply chain from the farm all the way to your table to find out what's actually making America's beef so expensive. To understand how the industry became so consolidated, we have to go back nearly 7 decades. Before the 1960s, beef was shipped as whole carcasses to butchers who would divide and package it themselves.
You won't be disappointed in these steaks, man. When meat packers started cutting and boxing beef right next to the slaughterhouse, it transformed the industry, shifting control from local butchers to centralized plants. These large operations were far more efficient and made it harder for small ones to compete. The Nixon administration pushed for this kind of growth across the farming industry. During his tenure in the early 70s, the US Secretary of Agriculture routinely told producers to get big or get out. By the late '7s, consolidation in the meat packing industry had started to take shape. Unlike today, the four biggest producers controlled just 25% of the market. Technological advancements
in the 80s improved efficiency and scalability, and once bigger became cheaper, deregulation made it even easier for large companies to take over. Throughout this time, regulators and academics raised their concerns about the effects of consolidation, but it continued largely unchecked. After decades of mergers and acquisitions, today's big four have absorbed or replaced the previous dominant firms and boosted their market share to more than 80%. This lack of competition gives the big four a lot of power. But how does this make the beef you buy at the grocery store more expensive than it's ever been? To understand that, we
have to go to the very start of the supply chain where even before consolidation concerns, counter ranchers are struggling. We're 7 miles from the nearest asphalt road and we wouldn't have it any other way. Eric Roer runs a cow calf operation in South Dakota and CVing season is about to begin. A cow's gestational cycle is nine months. you get one crack at it, you know, a year. My cows are out on winter grass. This is the easy time of year because as long as the grass is feeding them, I don't have to.
Grass is a precious resource when your ranch sits on a drought zone like Eric's. As of May 2026, 61% of US cattle were on land affected by drought. When drought dries up Eric's grass, he loses his cheapest and least laborintensive feed source. So, he has to buy feed, which adds to his expenses. It cost roughly $1,100 a year to run a cow when it used to cost 5 to800. The total operating cost for cow calf operations jumped 29% between 2020 and 2025. And because it costs more to raise cattle, ranchers like Eric are more eager to sell off their stock rather than keep some to maintain or build the size of their herd.
You do that all over the United States with this older generation cashing in on a high market. That's a whole lot of cows gone. That's led to the lowest total herd size in the US since 1951. All of this puts ranchers in a tough spot before they ever sell a single cow. While meat packers don't typically buy directly from ranchers, the selling stage is where their impact on the market becomes clearer. We'll explain. A rancher like Eric sells many of his calves to feed lots where they go to grow until they're ready for slaughter. After about four to 6 months, feed lots sell cattle to meat packers. Roughly 80% are processed by one of the big four.
Feed lots base what they can pay on what they expect to get for finished cattle later. When packers bid lower, what ranchers get paid shrinks, too. I'm a price taker. As a rancher, you're After the pandemic, meat packer profits rose. Two of the big four reported record earnings in 2022. This can't possibly happen in a competitive market. And during the pandemic, the difference between what a rancher was paid for cattle and the prices meatackers set reached its highest peak. All while consumer prices also went up. Back in
the spring of 2020, the, you know, meat packing plants were all over the news. Well, last month, we saw a huge price jump at the meat counter. Meat prices are expected to jump by up to 20%. We will all be paying more for meat at the grocery store for months to come. That leap prompted the DOJ to ask if meat packers were illegally coordinating to keep the price they pay for cattle low and wholesale prices high. A wide gap between the two could mean more money for the meat packers. Is there or was there ever an agreement to cooperate together on issues impacting supply or pricing?
No, no, not that I am worth. Outside of the House Agricultural Committee meeting, the companies didn't publicly say much about the matter at the time, and none of the big four responded to our request for comment. The pandemic did cause some changes. Labor shortages and plant closures contributed to higher beef prices. The Meat Institute, the primary lobbying group representing the big four meat packers, says other input costs like energy and transportation are also a factor. At the same time, the demand for beef increased because all of a sudden we were eating, you know, all of our meals at home in many parts of the country because of the stay at home restrictions. And so decrease in supply, increase in demand,
prices had nowhere to go but up. Ranchers had already filed an antirust suit against the big four the year before CO hit. The lawsuit alleged that since at least 2015, meat packers were working together to keep cattle prices artificially low, even as beef prices rose. Tyson responded by saying, "As with similar lawsuits concerning chicken and pork, there's simply no merit to the allegations that Tyson colluded with competitors." That case resulted in an $83.5 million settlement with JBS, but the company admitted no wrongdoing. Neither the ranchers suit nor the DOJ investigation led to major changes to the industry. But fast forward to 2025 and ranchers were getting record high prices for
their cattle because demand was high and supply was low. The problem, like Eric said, it already costs a lot more to raise cattle these days. The other problem, prices can shift quickly. And that's what happened in October of 2025. We are working on beef and I think we have a deal on beef. President Donald Trump's plan to import more beef from Argentina was meant to increase supply and reduce consumer prices. What immediately happened was that cattle prices dropped because of the uncertainty the announcement caused. After that dip, some ranchers have estimated losing $200 to $300 per cow sold. All while consumer prices remain high.
We all know and love good prices, but after 2014 and 15, we know they can be yanked out from under us so fast and put us back on the back in the line of almost going broke that the generational gap of baby boomers and a little younger than that are cashing out in this good market. 6 years after the original investigation, the DOJ has announced another probe into the same four companies. These companies now have an unprecedented ability to wield market power. In a truth social post from November 2025, Trump said he asked the Justice Department to investigate the meatacking industry once again. His reasoning was nearly identical to the first time, accusing the big four of driving up the
price of beef through illicit collusion, price fixing, and price manipulation. Meat Packers maintain they've still done nothing wrong. In a statement to Business Insider, the Meat Institute said the packers have been losing money for more than 2 years because of record high cattle prices. And a JBSUSA spokesperson told the Wall Street Journal that the company operates in a highly regulated industry and is committed to complying with all applicable regulations. Data from the USDA shows that prices ranchers get paid for cattle are generally rising faster than wholesale prices meat packers charge. Still, wholesale prices are on the rise. And this time around, the big four's business partners are suing them as well.
Companies like Target, BJ's Wholesale, and McDonald's say there's also collusion and price gouging on their side of the supply chain. This isn't just a legal drama. It's showing up in your lunch. High wholesale prices mean changes in retail, too. Our sort of house burger is a fried onion cheeseburger that is an authentic burger that was made in Oklahoma. Hamburger America opened in 2023 as an homage to the history of the hamburger. They were meant to be cheap. They were meant to be affordable.
Burgers at this New York City joint start at $7.75, 25 more than they cost last year. The restaurant says it's absorbing the rest of its increased expenses. Its wholesale beef costs are up by more than 20% since 2023. I mean, we're we're paying in this restaurant more than double what I started paying, you know, when I my first hamburger restaurant 17 years ago. Hamburger America sources its ground beef from Schweiden Suns, a small family-owned ground beef processor in New Jersey. Schweiden Sun sources some of its beef from the big four. So, even small businesses often rely on the larger system.
We work very closely with our supplier to try to maintain the price as tight as we possibly can. They're under pressure also and they have to pass along their cost. Andrew is focused on passing as little cost to the customer as possible. It's very important to us that the hamburger is affordable. And there are certain things Andrew says Hamburger America will never change. We won't change our quality. We won't change our sizes at all. You know, based upon rising costs, you know, we will not do that.
The company's current strategy to avoid raising prices further is a simple one. We hope to do more business and bring more customers in so that you know at the end of the day we you know if we do more business we can afford to sell it at a slightly lower margin. If beef prices continue to rise, Hamburger America will have to rethink its plan. Even in this restaurant since we opened in 2023, our beef prices are up over 20%. I mean if it went up 30 40% overnight, we might have to have a different conversation. There are a few things that could lower beef prices. The big four could face new regulations or demand could drop. But for meaningful price relief, um I think we need supply to increase or loosen. And for supply to increase, ranchers
have to be able to afford expansion. Eric says to do so, one thing is crucial, more competition. We don't need government bailouts. We don't need more government crop insurance or some kind of new cattle insurance. We need to fix the market to put some producer confidence back in this game. The Meat Institute agrees that more cows is the answer. It told us that to get there, it supports increased access to foreign markets and easing of regulatory burdens for cattle producers. In a statement to Business Insider, a USDA spokesperson pointed to the AY's beef action plan, an effort to rebuild herd sizes through things like expanding grazing on federal lands and reducing inspection fees for small processors.
Eric says if nothing changes, independent American cattle ranchers might be a thing of the past. All these small towns you drove through to get here, they're drying up. The stores on Main Street are closing. And it's because our egg economy, Trump's first administration, the egg secretary said, "Well, get big or get out." Sound familiar? You cannot consolidate a market without bad repercussions. And we're living it. The older generation is like, "I can't do this." The younger generation's like, "I'm not working that hard for no pay." My hope for the future is we give this next generation a chance to ranch and not be controlled.
