A recently released North American Agribusiness Review by RaboResearch Food and Agribusiness analysts digs into consumer trends, dairy production and other animal proteins to evaluate how farm production is meeting consumer demands.
U.S. economy
U.S. gross domestic product (GDP) growth remained solid in the third quarter of 2025, but employment growth has slowed. The impact of tariffs on inflation has been smaller than expected, and the Fed decided to resume its rate-cutting cycle in September.
Food inflation continues to outpace overall inflation, and restaurants are feeling the pressure. Restaurants have experienced nine straight quarters of declining traffic. Innovative restaurant formats and healthier menus are attracting diners while traditional chains are under the most pressure.
Dairy
August U.S. milk production increased 3.2% versus the prior year and, at 9.52 million cows, the herd size is now the largest since the mid-1990s. Milk per cow has increased month over month since February. RaboResearch expects this structural support to persist in the near term, with gains projected through the remainder of 2025 and into 2026.
Weaker all-milk prices will pressure margins into the fourth quarter and 2026, but low feed prices and record-high revenue from non-milk sources (primarily calf sales) should offset lower milk prices.
Domestic dairy demand signals are mixed, but exports remain strong. July total dairy exports were up 7% from last year, and cheese is on track for a record year.
Beef
U.S. retail beef prices continue to rise, with the USDA’s all-fresh beef price reaching a record $9.18 per pound in August. U.S. cattle slaughter from January through September is down 1.5 million head, a 7% drop compared to the same period last year.
Slaughter is expected to fall another 500,000 to 600,000 head in the fourth quarter as fed cattle supplies tighten and ranchers accelerate their efforts to rebuild herds.
Weekly U.S. fed steer prices peaked in early September at $244.25 per hundredweight (cwt) but have since declined by more than $10 per cwt. Feeder cattle and calf markets are showing strength, despite the typical pressure of fall-weaned calves coming to market. Weekly U.S. average prices for 500-pound steers hit a new high in mid-October. Prices for feeder cattle and calves remain mostly steady to slightly higher, and the trend is likely to continue through the fourth quarter.
U.S. processors are driving a strong demand for imported beef. On the export side, U.S. beef shipments to China were constrained by market access issues, contributing to a 10% decline in total beef exports from January to July.
Other protein
Pork prices remain well ahead of year-ago levels and the five-year average.
Chicken production continues to outpace year-ago levels, and chicken prices are down sharply in recent weeks, with boneless breast meat prices now 27% below year-ago levels.
Crops
Crop producers remain under pressure. An abundant corn crop has corn stakeholders pushing for year-round E15 use to boost ethanol demand, while soybean surpluses are increasing reliance on proposed biodiesel mandates to absorb excess supply.
