The combined U.S. cattle herd fell by 0.4% year-over-year as of January 1, with beef prices expected to remain high, and ranchers continuing to scale back their herds.

According to data released by the U.S. Department of Agriculture, there were an estimated 86.2 million heads of cattle in the U.S. at the start of 2026, representing the lowest levels the country has seen since 1951. That number is also down roughly 0.6% from July 2025, as cattle ranchers have struggled with drought conditions, higher prices for grain and feed, and climbing interest rates. Meanwhile, beef prices have risen in kind, after cresting the $6 per pound threshold last year for the first time since data collection began in the 1980s.

"U.S. cattle farmers have faced significant challenges in recent years, from COVID-19-related supply chain disruptions, low cattle prices and persistent drought conditions, to growing threats of invasive pests and diseases, a decades-low supply of beef cows and historic inflation in production costs," said the American Farm Bureau (AFB) in an October 2025 market intel report.

Concerns over a resurgence of the New World screwworm (NWS) — a parasitic fly that produces larvae that feed on living cattle and other grazing animals — have persisted as well. Although the pest was eradicated in the U.S. in 1966, the NWS was found north of Panama for the first time since 2000 last year, and has even appeared just 70 miles south of the U.S./Mexico border. Should it find its way back into the U.S., it could cost the country's cattle industry billions of dollars, the AFB warns.

The situation for cattle farmers now remains tenuous, the AFB added, although many are now operating in the black for the first time in years, as demand for beef has stayed strong across the U.S. However, the group cautioned that rebuilding the national herd will take years, given the ongoing cost pressures created by high prices, and droughts that have continued to force ranchers to make difficult decisions about the size of their respective herds.