The global meat and livestock sector continues to evolve. Some of the big drivers over the past decade include COVID, African Swine Fever (ASF), other animal disease issues (HPAI), higher labor and capital costs, a surge and subsequent collapse of feed costs, and inflation at rates not seen in 40 years. The constant has been near-stairstep global demand growth as populations and incomes continue rising.
While a thorough explanation of economic health would need to explore each livestock and meat sector in a variety of countries, this article offers a macro-view of key factors broadly applicable.
The basic math of meat and livestock margins compares the cost of raising, feeding, and processing poultry and livestock against the value of meat and poultry at the wholesale and consumer levels. And feed grains are a key input of most meat and livestock production.
Note that feed grains have seen wild volatility over the past 25 years, driven by weather, biofuel policy, and wars.
Today, that simple math shows that broadly speaking, meat price inflation has outpaced feed grains. This has been positive for meat and poultry producers this year.
On processing side of the industry, key issues include labor supply, supply chain disruptions, sustainability regulations and pressures, regulatory/food safety hurdles, and increased demand for higher value branded and niche products. Meat and poultry processors have been forced to become more cost conscious and innovative. Broadly speaking, large processors have been better suited to navigate these challenges seeing consistent profits, while smaller processors have been driven to find smaller, value added markets. The nimble have found success there.
Financial results have varied around the world but broadly speaking processors have been economically challenged from 2020 (COVID) through 2024. In 2025, processor margins have broadly improved as companies have consolidated, integrated, and/or innovated in their efforts to limit cyclical and structural volatility; beef processor margins being the exception, falling due to tightening cattle supplies.
~Brett Stuart
