Why Red Meat Companies Are Struggling Yet Again in 2025

Companies across Australia, New Zealand, the United States, and parts of Europe are reporting tightened profit margins, rising production costs, and a steady decline in meat consumption per capita. These developments suggest that the red meat industry is not just experiencing a rough patch—but is undergoing a long-term transformation that could reshape its future entirely.

The red meat industry, once considered a reliable and resilient sector in global agriculture, is now grappling with another difficult year in 2025. Economic pressures, shifting consumer behavior, sustainability concerns, and global trade disruptions have all contributed to a new wave of uncertainty for red meat producers.

High Input Costs and Labor Shortages Continue

One of the biggest concerns for red meat companies this year remains the high cost of inputs. Feed prices, especially grains and fodder, have increased significantly due to erratic weather patterns and global supply chain bottlenecks. Fertilizer and fuel prices also remain above pre-pandemic levels, increasing the overall cost of raising livestock.

In addition, labor shortages persist. With fewer young people entering agriculture and rural populations shrinking, meat companies are finding it difficult to maintain adequate staffing in slaughterhouses, processing plants, and even farms.

Many companies are investing in automation to deal with this issue, but the upfront costs are high, and the technology is not yet fully replacing skilled labor.

“Our operational expenses have gone up by nearly 20% compared to last year,” said a spokesperson from an Australian-based meat export firm. “And while demand from some Asian markets remains steady, it is not enough to offset losses in Western markets.”

Demand for Red Meat Weakens Globally

A major contributor to this downturn is the shifting dietary habits of consumers worldwide. Health trends and growing awareness around climate change are causing more people to reduce their red meat intake or switch to plant-based alternatives.

In the United States, red meat consumption has declined by over 5% in the past 12 months, according to data from USDA Economic Research Service. European countries have reported similar patterns, particularly among younger consumers who are actively choosing more sustainable protein options.

Additionally, the rise of lab-grown meats and plant-based meat alternatives, promoted by companies like Beyond Meat and Impossible Foods, are creating stiff competition. These companies appeal to health-conscious and environmentally aware buyers, and their market share is growing fast.

Climate and Environmental Pressures

Climate change remains a major obstacle for red meat production. Rising temperatures, water shortages, and extreme weather events are all making livestock management more difficult. Drought conditions in Australia and parts of the US are already forcing ranchers to reduce herd sizes or shift operations.

Moreover, pressure from governments and environmental groups to reduce greenhouse gas emissions is increasing. Red meat production is known to be a significant source of methane emissions, and policymakers are demanding stricter regulations.

The European Union, for example, is tightening its environmental compliance laws, requiring meat producers to meet specific emission benchmarks or face penalties.

“We are at a point where sustainability isn’t just an option—it’s a requirement,” said Emma Rowe, a sustainability consultant for agri-businesses. “Red meat companies need to rework their supply chains, reduce emissions, and prove their practices are environmentally responsible.”

Trade Disruptions and Export Dependency

Many red meat companies, especially in Australia and New Zealand, rely heavily on exports to Asian markets. While demand from countries like China, South Korea, and Japan has remained somewhat stable, recent geopolitical tensions and trade policy changes have made exports unpredictable.

New tariffs, port delays, and sanitary concerns have made it harder for companies to get products to foreign markets efficiently. In some cases, shipments are delayed by weeks, leading to loss of product quality and market value.

As a result, several companies are considering diversifying their target markets and investing more in domestic sales channels—though doing so may require rebranding and shifting their product lines.

Industry Response and Adaptation

Despite the headwinds, red meat companies are not giving up. Many are innovating to stay relevant and resilient. Some are improving animal welfare practices to appeal to conscious consumers. Others are investing in carbon-offset programs or water-saving technologies to reduce their environmental impact.

Digital transformation is also helping. AI-powered livestock monitoring, supply chain tracking, and predictive analytics are now playing a larger role in decision-making for production, pricing, and logistics.

In a strategic move, some red meat businesses are even expanding into alternative protein sectors. By investing in plant-based products or blended meat alternatives, these companies hope to capture the broader protein market without abandoning their core identity.

Looking Ahead: Is There Hope?

Analysts believe that the future of the red meat industry depends on how quickly and effectively companies adapt to modern consumer demands and environmental expectations. Traditional production and marketing models may no longer suffice in a world that values sustainability, transparency, and innovation.

The companies that can balance profitability with responsible practices are more likely to survive the turbulence and even thrive in the long term.

“It’s a time of reckoning,” said Andrew Murphy, an agricultural economist. “Red meat is not going away anytime soon, but the industry’s survival depends on bold changes—not business as usual.”

List of companies which are facing problems.

Also Read – Shocking Report: AI Alters Foreign Call Centre Accents Fast