Summer Grilling Season: Beef Volumes & Spend Data

Composition of Growth Shifts as Volumes Decelerate

The U.S. cattle herd has contracted for eight consecutive years, driving retail beef prices to successive all-time highs. CE Scanner data shows centerstore beef spend remains strong, up +10% y/y (+46% y/2y) in the latest four weeks ending April 5th. However, the composition of growth has shifted meaningfully. Volume growth has moved from the high-single-digit range in 2024 to slightly negative in recent weeks, while pricing growth has moved in the opposite direction, accelerating from mid-single-digits to +11% y/y. Consumers have largely been willing to absorb years of cumulative price increases, though recent volume deceleration suggests there may be diminishing capacity to continue doing so.

Substitution Concentrated in Chicken, Private Label Offering Diminishing Relief

Substitution remains concentrated in chicken, while private label no longer offers a clear value proposition, limiting consumers’ flexibility to shift spend. Chicken has been the primary beneficiary of elevated beef prices over the past several years, and continues to see stable volume growth as its relative price advantage versus beef widens. However, not all proteins have seen a similar lift. Pork volumes continue to decelerate despite a similarly expanding price gap, suggesting the substitution dynamic is more nuanced than a straightforward price-driven rotation across the protein complex. Within beef, the traditional trade-down into private label appears to offer diminishing relief, with the branded-to-private label price gap compressing from nearly $0.20 per lb in 2025 to ~$0.05 per lb in 2026. Consumers can still adjust by shifting spend toward lower-priced cuts, but trade-down avenues appear to be narrowing. Net, this increases the likelihood that incremental pressure shows up through reduced purchasing frequency rather than further trade-down, creating additional headwinds for packers operating in an already challenged environment.

Herd Rebuilding Timeline Leaves Few Levers to Support Volumes

The supply side of the equation offers little near-term relief, with meaningful herd expansion unlikely before 2028, according to the USDA. Ranchers continue to prioritize current earnings over herd rebuilding, keeping retail prices elevated for the foreseeable future. While increased promotional activity could help support near-term volumes, it would come at the cost of compressing margins in an environment where input costs remain elevated and packers are already operating at a loss. Consumers have largely absorbed higher prices to date, but as volume growth stalls, the risk of demand erosion becomes more pronounced, particularly given the duration of the supply deficit and historical recovery timelines, which limits the likelihood of a near-term pricing reset to attract consumers. With the summer grilling season approaching, the category enters a period with historically strong seasonal demand, making any further volume softness a more meaningful signal of consumer price resistance.