China's beef wholesale prices hit over two-year high; analyst sees uptrend lasting into 2027

Shanghai — Domestic beef wholesale prices have risen sharply in recent weeks, with one trader at the Shanghai Western Suburb International Agricultural Products Trading Center reporting that prices have increased roughly 10 yuan per kilogram over the past month.

"Beef prices have been rising continuously. Since August, there have been five or six price hikes, and another increase is coming soon," a domestic beef wholesaler at the center told Yicai. The trader attributed the rise primarily to higher live cattle prices, which have been passed down the supply chain.

According to monitoring data from the Ministry of Agriculture and Rural Affairs, the national wholesale price of beef has accelerated notably since August, rising approximately 6% over the past month.

Multiple Factors Driving the Rally

Shao Qiaoqiao, an analyst at Zhuochuang Information, told Yicai that the current price surge is the result of multiple overlapping factors. The dominant driver is a sharp contraction in domestic beef cattle supply due to deep capacity reduction. Additional support comes from safeguard measures on imported beef and the onset of the peak consumption season.

Data from the Ministry of Agriculture shows that as of September 21, the average wholesale price of beef at national agricultural product wholesale markets stood at 71.59 yuan per kilogram — up nearly 6% since early August and nearly 9% year-on-year. According to Wind Data, the average price has reached its highest level in more than two years.

At the retail level, some fresh markets and e-commerce channels have also raised prices by about 10 yuan per kilogram, tracking the wholesale increases.

Supply Contraction: The Core Driver

"The main reason for the price increase is that there are fewer cattle now. In previous years, farming losses were severe, and many breeding cows were slaughtered. Since cattle take about two to three years to mature, domestic beef supply is now relatively tight," one wholesaler explained.

Shao noted that from 2023 to 2025, the industry experienced roughly three consecutive years of losses, prompting a large number of small and medium-sized farmers to cull breeding cows. This deep reduction in breeding capacity is the fundamental cause of the current price rally.

National Bureau of Statistics data confirms a continuous decline in cattle inventory since 2024. By the end of 2025, the national cattle inventory had fallen to 96.08 million head. As of the end of the second quarter of 2026, it had further declined to 95.57 million head, down 4.3% year-on-year.

"In the first half of 2026, the inventory of breeding cows continued to decline. Traditional small-scale breeders, hit hard by earlier losses, culled at high rates. In some regions, breeding cow inventories fell by 10% to 30% from their 2023 peak," Shao said, citing data.

Import Safeguards and Seasonal Demand Add Pressure

The industry's deep losses in prior years were not only due to cyclical fluctuations but also to the impact of low-priced imported beef. According to a 2025 Ministry of Commerce announcement, the increase in imported beef volumes had caused serious damage to the domestic industry, with a causal link established between the two.

Since January 2026, China has imposed safeguard measures on imported beef in the form of country-specific quotas and additional tariffs beyond those quotas, with a three-year implementation period.

As of the latest data:

• Australia, a major source, has reached 100% of its quota and is subject to a 55% additional tariff.
• Brazil reached 90% of its quota by August 10.
• Argentina reached 50% of its quota by August 5.

Shao analyzed that as the pattern of "lower volume, higher prices" for imported beef becomes established, a positive price spiral has formed between domestic and imported beef. The price gap is narrowing, strengthening the pricing power of domestic beef.

On the demand side, the arrival of the peak consumption season is also boosting prices. "The fourth quarter is the traditional peak season for beef consumption, with demand typically rising about 5% quarter-on-quarter," Shao said. Drivers include holiday banquets, family gatherings, gift box purchases, cooler autumn weather boosting home cooking and hotpot consumption, and advance stocking by slaughterhouses and prepared-food companies.

How Long Will the Rally Last?

The impact of rising beef prices varies across the supply chain. Industry insiders say the price increase directly benefits farmers by improving profit margins, which could accelerate the pace of large-scale farming and breed improvement.

For wholesalers, however, higher prices create sales pressure. "Consumer demand is relatively stable right now, and competition among peers is fierce. If we raise prices too much, buyers may switch to other wholesalers. So we are being very cautious about markups," one wholesaler said.

He added that as weather turns colder and market demand picks up further, wholesale prices may see modest increases, but the final outcome will depend on market conditions.

Shao forecast that, given current breeding cow inventories and supply-demand dynamics, the domestic beef price center will remain elevated, with the upward cycle expected to last until 2027.

"The lag effect of capacity reduction will continue to play out. Based on the typical two-year lag from calf to market, the inflection point for domestic beef cattle supply (contraction) has already arrived in the second half of 2025, and the supply gap is expected to persist for more than two years," Shao said.

He predicted that beef prices will remain high in September, trading in a range of 70 to 80 yuan per kilogram. From the second half of 2026 to the first half of 2027, as both domestic and imported supply contract, prices could rise further.