Proposed tariffs could impact Brazilian imports
On July 9, U.S. President Donald Trump revealed plans to impose a steep 50 percent tariff on all Brazilian imports, effective Aug. 1. If enacted, the tariff could have a significant impact on the beef industry.
The announcement comes at a time when the U.S. cattle herd is at its lowest numbers in decades, consumer demand for beef is surging and beef prices are already high.
Analysts and cattlemen groups say the tariffs could lead to a short-term boost for U.S. beef producers by reducing competition from outside markets and directing demand to the domestic front, but there are also concerns about record-low herd numbers in the U.S. and fears about the broader strain on the market driving consumer costs even higher.
Beef industry impact
The U.S. beef industry relies on foreign imports to supplement its domestic supply chain. Brazil is one of the leading exporters of beef globally, with the U.S. being one of Brazil’s most important markets second only to China.
According to Reuters and livestock analysts, the proposed 50 percent tariff would be levied on top of a pre-existing 26.4 percent tariff, amounting to a staggering combined rate of 76.4 percent on imported Brazilian beef.
If the tariff does take effect, U.S. importers will be faced with a decision between paying the cost of Brazilian beef or obtaining it from other higher-cost sources.
Currently, Brazilian beef accounts for roughly 23 percent of U.S. beef imports. Cattle sourced from Brazil are key suppliers of the lean grind used in ground beef – one of the most popular beef products among American consumers.
A recent reduction of lean grinding beef produced domestically has caused meatpackers to rely heavily upon imports. Domestic cow slaughter has decreased dramatically in the past two years, with experts crediting the reduction to drought, rising production costs and a record-high cattle market.
“Liquidation resulted in not only a much smaller cow inventory, but also a much younger and more productive cow herd,” comments John Nalivka, president of Sterling Marketing, Inc. in an opinion piece for Drovers. “Consequently, cow slaughter has been sharply reduced during 2024-25 as cattlemen now maintain herds in the face of record-high prices.”
Although the looming tariffs may present a short-term boost by directing demand back to the domestic front, experts warn weather conditions and high input costs may hinder the American market’s ability to expand quickly.
For now, Brazil appears to be preparing for the tariff to go into effect, with exporters beginning to pull back on cattle purchases in anticipation of decreased demand from American markets.
Cattlemen’s groups voice support
Several U.S. cattlemen groups are praising the proposed tariffs as a win for the domestic cattle market, including R-CALF USA and the National Cattlemen’s Beef Association (NCBA).
Statements from representatives of each group credit the tariff as a potential boost for the domestic supply chain and a safeguard against health and safety concerns surrounding Brazilian beef.
R-CALF Chief Executive Officer Bill Bullard is in full support of the increased tariff against Brazil, viewing it as a win for the American market.
“It appears the Trump administration is looking out for our domestic supply chain, while previous administrations, for many years, bowed to the free-trade ideal,” Bullard states. “We cannot both continue allowing Brazil and other countries to penetrate our market with their beef and rebuild our diminished beef supply chain, which is necessary to protect our national food security.”
“President Trump’s 50 percent tariff on Brazilian beef is an excellent start, and we hope he will soon do the same for Canada, Mexico, Australia and New Zealand, which – like Brazil – are contributing to the dismantling of our domestic food chain,” Bullard concludes.
NCBA has also voiced support for the tariff, crediting a long history of concerns regarding Brazilian health and safety standards when it comes to imported beef.
“For many years, NCBA has called for a full suspension of imported Brazilian beef due to their abysmal lack of accountability on cattle health and food safety,” says NCBA Director of Government Relations Kent Bacus. “A 50 percent tariff is a good start, but we need to suspend beef imports from Brazil so we can conduct a thorough audit and verify Brazil’s claims.”
Consumer impact
Tighter restrictions on imports could mean increased prices on supermarket shelves.
The latest inflation report from the U.S. Bureau of Labor Statistics shows ground beef prices are already at an all-time high of $6.12 per pound, up 12 percent year-over-year. This trend is expected to continue to increase following the proposed tariffs, as meatpackers work to keep up with demand in the face of rising import and production costs.
In a statement for Al Jazeera, David Ortega, a food economist and professor at Michigan State University, says, “U.S. importers will either have to pay the higher cost of Brazilian beef or obtain it from other higher-cost sources. This could lead to higher prices for certain beef products, particularly ground beef and hamburger meat.”
The cost of dining out could rise as well, as restaurants rely heavily upon imports to keep up with demand.
“Dramatic tariff increases could affect menu planning and food costs for restaurants as they attempt to find new suppliers,” says Sean Kennedy, executive vice president of public affairs at the National Restaurant Association. “Our industry relies on a steady supply of imported goods which cannot be produced in the U.S., and we urge the Trump administration to pursue policies that will secure fair trade agreements.”
As Americans continue to prioritize protein in their diets, keeping beef in the lineup may be a nonnegotiable in spite of increasing prices. Other industry representatives predict a boost in other animal protein sales, like pork and chicken.
As noted by Jim Eadie in an article for swineweb.com, the full impact of the tariff will depend on how long it stays in place and whether retaliatory measures or supply chain adjustments amplify the shockwaves.
Grace Skavdahl is the editor of the Wyoming Livestock Roundup. Send comments on this article to roundup@wylr.net.
