There is no grocery store price gouging. Prices at the store and prices you pay are rising lockstep with the Producer Price Index (PPI) for slaughter cows.
Trump is also investigating major meatpackers for collusion, but that’s nonsense as well. Ten meatpackers are not going to be more efficient than four.
And Trump needs to look into the mirror at deportation practices killing the labor supply of meatpackers forcing up wages.
But hey, deport them all, right? $12.99 per pound would be just another small price to pay, wouldn’t it?
The main culprit is cattle herd size. But deportations and labor supply played a role too.
Current Herd Situation (as of Jan 1, 2026)
Total U.S. cattle and calves: 86.2 million head — the smallest inventory in 75 years (lowest since ~1951) and the 8th consecutive year of contraction. nass.usda.gov
Beef cows: 27.6 million head, down 1% year-over-year, the smallest since 1961.
2025 calf crop: 32.9 million head, down ~1.6%, one of the smallest on record. Cattle Economics
Modest increases in replacement heifers and dairy cows, but not enough for meaningful expansion yet. Analysts expect the herd bottom may be near, but significant rebuilding likely won’t occur until 2028 or later due to the biology of cattle cycles (gestation, time to market). fb.org
This tight supply — fewer breeding cows and calves entering the pipeline — directly constrains slaughter-ready cattle (fed steers/heifers + cull cows/bulls).
Trump Proposes Reducing Beef Tariffs
To alleviate rising beef prices, Trump is taking the politically popular price gouging meme.
Biden did this too, and Elizabeth Warren has been proposing this for decades, so it’s a uniparty blame game here.
The interesting thing is Trump’s proposal to lowing tariffs and quotas is a direct admission that tariffs raise prices!
So, yes, blame Trump for that, and Biden before Trump, and Trump before Biden, etc.
The Uniparty Loves Tariffs Too
Tariffs are politically popular. Made in America, save jobs, unfair trade, all sound great for a while.
Everyone pays a small bit more to make handouts to select industries (like autos, steel, aluminum, and agriculture).
This can, and did, go on for a long time. But at some point …
The Affordability Meme Takes Over
At some point (hint – right now), it all breaks down.
The prices of everything that includes steel, aluminum, electronics, and beef becomes more than a “small price to pay”.
Consumers get fed up. They blame politicians. Then politicians do what they always do.
Q: What’s that?
A: Blame the other political party, blame price gouging, insist that they know what they are doing, and claim it’s all temporary.
It’s Temporary, I’d Do It Again
Trump was confronted with his own quote, “I don’t think about Americans’ financial situation,” and instead of walking it back… he DOUBLED DOWN. “I’d make it again.” Then, he defended skyrocketing costs and Americans struggling as “short-term pain.”
That reflects in the polls. Trump is now polling worse than Biden ever did on affordability. Drastic action is needed.
Drastic Action – Lower Beef Tariffs
A week ago. Trump proposed lowering tariffs on beef imports.
As noted above, it’s a direct admission that tariffs raise prices, because if they don’t why lower the tariffs.
But please recall that Trump and the administration has repeatedly claimed that exporters not consumers pay the tariffs.
So, if someone tells you tariffs don’t increase prices then have them explain the above contradictions.
Q: But what happened to lower tariffs?
A: Farmers screamed.
Those who want everyone else to pay a small price for their benefit always scream. And when farmers scream, it generally gets Trump’s attention. Which leads us to …
Trump Delays Move to Lower Tariffs on Beef Imports
The Wall Street Journal reports Trump Delays Move to Lower Tariffs on Beef Imports
President Trump had planned to sign Monday a pair of executive orders to lower tariffs on beef and reduce regulations on American cattle producers. On Monday evening a White House official said the actions had been delayed as the administration finalizes details.
The delay followed outcry from some congressional Republicans and cattle ranchers, typically a solid part of Trump’s base. The Wall Street Journal earlier Monday reported Trump’s plans to sign the orders.
The administration had planned executive orders that would suspend the annual tariff-rate quota—which applies a higher tariff rate after a certain level of beef imports are reached—on all beef-exporting nations, enabling more of the product to enter the U.S. at lower tariff rates.
Opening the way for more imports risked angering cattle ranchers, a reliable constituency of the president’s. Trade groups representing U.S. cattlemen opposed the administration’s move to enable more beef imports from Argentina and on Monday criticized Trump’s planned tariff move, warning that an influx of cheap meat would hurt American ranchers.
No Winning Move
There is no winning move here.
Consumers are fed up with high prices and farmers want their tariffs.
Farmers are also upset over the price of diesel, now at $5.646, a mere 17 cents from a record. And by the way, I expect a new record price very soon, possibly this week.
Farmers are also upset over the price of fertilizer. Guess what. Trump’s proposed remedy is to lower tariffs. Fancy that.
Stupidest War in History
This is one of the stupidest wars in history. Trump did it at the request of Benjamin Netanyahu, Israel’s prime minister, and warmongers like Ted Cruz and Lindsey Graham.
Instead of blaming himself, or Cruz, or Netanyahu, Trump repeats his meme of “small price to pay”.
“I’d make it again,” said Trump when asked about starting the war.
That statement hits every person of common sense in the United States, including farmers. Many farmers now realize Trump sold them a bill of goods over exports, fertilizer, and diesel.
US Trade Rep on Soybeans
Soybean Fact Check
On May 15, 2026, I asked How Many Times Can China Agree to Buy the Same Soybeans from the US?
Heading into the summit in China, republicans had high hopes. Did anything happen?
Quite literally nothing happened other than the US sent over an entourage of 10+ CEOs for a China pony show with Trump as the dog.
Oh, I almost forgot. China agreed to buy the same soybeans it has agreed to buy for years.
Success!
Michael Pettis chimed in.
Trump’s Stated Goals
Trump wants to do two incompatible things, bring back manufacturing and increase exports.
Except in certain specialties, the US is a high cost producer. We are not going to bring back iPhone production here or aluminum production here without a tremendous increase in costs.
And if we have a tremendous increase in costs, consumers will pay more, and we will have fewer exports. Tariff revenue would collapse, by definition, if costs rise.
Yet, Trump proposes to produce more in the US, while increasing tariff revenue, without raising costs despite a guaranteed higher cost environment, and simultaneously increase exports on top of that.
Read that sentence above and tell me how it works. You can’t but that is what Trump says and MAGA believes.
This is one of the things I have been pointing out for years. It just doesn’t work. But Trump keeps upping the ante on tariffs, replacement tariffs, and now because of the war, even more deficit spending.
Lacy Hunt, a Bond Bull for 44 Years, Now Forecasts Higher Inflation
Yesterday, I commented Lacy Hunt, a Bond Bull for 44 Years, Now Forecasts Higher Inflation
“I did not have this on my bingo card,” quipped John Mauldin.
If you have not yet read the above post, please do so. It’s not easy changing a 44-year belief.
Lacy just did.
This post shows why we need a political and economic reset. However, Trump is heading in the wrong direction, unable to change.
And Warsh won’t change much at the Fed either. I believe this realization is behind the change by Lacy Hunt.
I await his next quarterly review.
Back and Forth with Grok
Trump desperately needs a deal. But he only issues demands. Meanwhile, the alleged crippling hold the blockade Trump put on Iran failed.
The blockade has been ongoing since April 13. Recall that it was supposed to make Iran fold in three days.
Farmers Patience Running Thin
Keeping Up With Inflation?
Totally Out of Touch With Priorities
I expect a Republican bloodbath in the midterms.
I would not at all be shocked if farmers get so upset that Iowa, Texas, or Ohio flips to the Democrats.
Ohio flipping is my base case actually. Iowa isn’t. But it’s on my radar. I don’t believe Iowa is on anyone else’s radar.
My rationale: farmers are getting killed by Trumps policies (exports, diesel, fertilizer, machinery tariffs).
I am not predicting Iowa, yet. Rather, I am saying that I would not be surprised, and it’s on my radar to watch.
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