The cattle and beef markets experienced a notable downturn in July, driven primarily by adjustments in the futures market and unexpected trade announcements.
“Cattle and beef markets suffered through a significant correction in July,” says Derrell Peel, Oklahoma State University Extension livestock marketing specialist. “Led by Live and Feeder futures, feeder and fed cattle markets were dragged lower through July.”
According to Peel, the market faced additional downward pressure at the very end of the month following USDA news regarding the planned re-opening of the Mexican border.
“Cattle markets are attempting to recover in August, but the struggles continue with extended summer heat causing deterioration of pasture conditions and limiting summer activities,” Peel notes.
How Are Summer Heat and Drought Affecting Pastures?
While widespread drought from earlier in the year showed significant improvement heading into mid-summer, recent extreme temperatures are reversing those gains.
“Widespread drought earlier in the year moderated significantly into July,” Peel explains. “Compared to the peak drought level in April, conditions have improved, especially in the Southeast and Mississippi Delta. However, significant drought remains in much of the Great Plains and the West and remains a threat in numerous other regions.”
Peel warns that these improvements are already beginning to slip. “Average U.S. drought conditions were most improved by late July and have begun to deteriorate again with widespread extreme temperatures the past two to three weeks,” he says.
This weather pattern is directly impacting forage availability across the country:
- National Conditions: The latest reported pasture and range conditions stood at 46% in “poor” and “very poor” condition — well above the five-year average of 37%.
- The Great Plains: This region is experiencing the worst conditions. In Kansas, northern areas, and the plains of Colorado, Wyoming and Montana, 53% of range and pastures are rated poor to very poor, compared to a five-year average of 31%.
- The West and Southern Plains: These regions remain close to average, with poor to very poor conditions at about 40% in the West and roughly 36% in the Southern Plains.
- The Southeast: This region saw the most early-year improvement, dropping from 36% poor to very poor in May to a low of 21% in late July, though these numbers have increased in recent weekly data.
How is Late-Summer Heat Impacting Retail Beef Demand?
In addition to impacting pasture conditions, prolonged triple-digit heat waves are changing consumer behavior and weighing heavily on seasonal beef demand.
“Hot summer temperatures have also taken a seasonal toll on beef demand after the Independence Day holiday,” Peel says. “Choice boxed beef prices have decreased through the summer doldrums, matching one year ago in typical seasonal changes.”
While wholesale beef values have turned slightly higher recently due to sputtering attempts at a final demand push for the Labor Day holiday, prolonged extreme heat is making a significant rebound difficult.
“After a brief August boost, average boxed beef prices typically decrease to the end of the year,” Peel explains, though he notes that tenderloin and ribeye prices still move seasonally higher toward the end of the year. Looking ahead, Peel cautions “strong boxed beef prices in the second half of 2025 may be hard to match this year, even with good demand.”
What is the Outlook for Market Recovery?
Despite the recent setbacks, Peel expects the market to eventually find its footing, even if the timeline is stretched.
“Cattle and beef markets are expected to continue recovering from the summer correction,” Peel concludes, “but the persistent summer doldrums may make it a slow grind for the next few weeks.”
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