Beef is getting cheaper, bringing some economic relief to American consumers.

Beef prices, typically among the most expensive purchases at grocery stores, are falling after more than a year of gains as consumer demand slows for some cuts. Supply is improving due to better staffing at meat plants, and supermarkets are offering more discounts on rib-eye, New York strip and other often expensive products.

For months, prices of food and consumer products have been rising across grocery aisles due to higher costs of transportation, ingredients and labor. Some of the biggest increases have been in the meat section, with shoppers buying cheaper cuts or switching to cheaper protein like chicken. As beef prices rise, consumers are finding more deals and options, industry executives and analysts said.

Retail beef prices fell 0.7% for the four-week period ended Aug. 7 compared with the same period a year ago, according to data from research firm Information Resources Inc. This decline came after beef prices fell 1% over the previous four weeks, the first monthly decline since June 2021. U.S. retail beef prices had not fallen for two consecutive months in over a year and a half, although they remain at historically high levels.

In July, U.S. inflation fell slightly from a four-decade high as gasoline costs fell from June levels along with declines in used car prices and airfares. Grocery prices rose 1.3% in July compared with June, according to Labor Department data, and the cost of dining out also rose.

Rib-eye and beef prices are down nearly 10% in the four weeks ended Aug. 7 compared with a year ago, while brisket is down about 18%. Prices of ground beef – among the cheapest beef products and still in high demand – rose about 7% in the period, compared with a rise of about 20% in January.

“The cost of all that stuff is piling up and it’s starting to hit people’s wallets,” said Carey Otwell, director of meat and seafood at Mitchell Grocery Corp.

The Alabama-based grocer sells less premium meats such as grass-fed beef. People continue to buy cheaper cuts like ground beef, which keeps prices up for these products. Mitchell’s average cost of a case of beef fell around 13% over the past 12 weeks compared to the same period a year ago.

Howard Radziminsky, a retiree who lives in Scottsdale, Arizona, said he recently bought rib-eye for $5.97 a pound. pound and New York strip steaks for $4.77 per pound. Mr. Radziminsky, who follows a protein-heavy diet and eats red meat five to six days a week, said he hadn’t seen rib-eye sell for less than $6 a pound in a while.

“Promotional prices have come back to where they were two years ago,” he said. “I always eat red meat. I’m happy.”

Since the start of the pandemic, meatpackers such as Tyson Foods have Inc.,TSN -1.14%

JBS USA Holdings Inc., National Beef Packing Co. and Cargill Inc. have said they could not process as many cattle as normal because their facilities were staffed. That limited supplies, they said, pushing up prices while demand remained warm.

As inflation rises in the United States, rising food and energy costs have pushed the country’s most popular price index to its highest level in four decades. WSJ’s Gwynn Guilford explains how the CPI works and what it can tell you about inflation. Illustration: Jacob Reynolds

Arkansas-based Tyson Foods, the largest U.S. meat processor by sales, said the company’s own average selling price for beef was 1.2% lower in the three months ended July 2 as customers opted for cheaper cuts. The wholesale price of boxed beef sent from meatpackers per August 13, is down about 15% from a year ago, according to the Ministry of Agriculture.

Some of the bottlenecks at processing plants that drove up prices over the past two years have eased, improving U.S. beef supply, said Katelyn McCullock, senior agricultural economist at the Livestock Marketing Information Center.

“We’re getting healthier from a labor perspective,” said Shane Miller, head of Tyson’s beef and pork unit, adding that higher wages and a number of new benefits programs have helped staffing. “We are driving more volume to our facility.”

A tight labor market and higher than pre-pandemic employee turnover and absenteeism rates at meat plants are expected to keep processing capacity limited in the industry, executives and industry analysts said. Boxed beef prices remain about 30% above their five-year average, according to the USDA.

More cattle are being sent to processing plants as ranchers shrink the size of their herds due to persistent drought conditions in parts of the United States, helping to improve the supply of beef in stores.

Prices for some cuts of beef may not stay down as long as cattle supplies tighten. U.S. beef production is expected to decline later in 2023, limiting the supply of cattle and ultimately raising the price of beef, according to the USDA and agriculture leaders.

Tyson CEO Donnie King said on a call with analysts this month that he expects the company to pay more for cattle going into 2023 and even 2024 as supply tightens.