Despite vocal opposition from ranchers and ag groups, President Donald Trump formalized his plan to allow more beef imports for at least the next 90 days.
His Aug. 26 proclamation authorizes 300,000 metric tons of lean beef trimmings to be imported tariff-free in the coming months. That beef will reportedly be sold for 25% below current market value, though Trump has yet to offer specifics on which exporters have agreed to that stipulation. The additional imports will be delivered in monthly 100,000 metric ton tranches set to begin Sept. 1.
Trump’s plan is intended to help lower grocery prices. American Farm Bureau President Zippy Duvall counters that allowing the equivalent of 660 million pounds of foreign beef at a 25% discount only undermines U.S. ranchers.
“A 90-day suspension of the tariff rate quota on imported ground beef has created apprehension and chaos in the cattle market,” Duvall said in an Aug. 26 open letter to Trump. “In fact, 70% of the spring-born calves are sold during the 90-day window that overlaps with the plan to increase beef imports. This weakens cattle prices and erodes the confidence U.S. ranchers need to make the long-term investments required to rebuild our cattle herd.”
According to an AFBF analysis, the record-low U.S. cattle herd is showing signs of finally recovering. A 3% increase in beef heifers kept for replacement may be a sign that ranchers are starting to retain rather than sell them. However, the combination of falling prices paid to farmers and Trump’s tariff plan could potentially discourage this rebuilding.
“Bringing down the price of cattle will not bring the price of beef down for American families,” Duvall continued in his letter. “Instead, it will discourage American farmers and ranchers from making long-term investments in herd rebuilding, extending the cycle of tight cattle supplies, high production costs and elevated beef prices for consumers.”
Duvall also signed on to another Aug. 26 letter to Trump urging the president to reconsider his plan. That letter — co-signed by officials from the Livestock Marketing Association, the National Cattlemen’s Beef Association and the U.S. Cattlemen’s Association — said Trump’s decision sends a “disheartening message” to farmers and ranchers. The cattle industry leaders go on to say that they are deeply concerned that Trump’s import strategy sacrifices long-term food security for a short-term solution.
“Beef prices are in line with other consumer prices and reflect the inflated cost of raising cattle, grain and forage,” the cattle leaders said. “Ranchers and farmers are finally experiencing the strong beef demand needed to invest in their operations after years of drought, high input costs, processing plant disruptions and other challenges that have reduced cattle numbers. This announcement will discourage investment in the U.S. cow herd and undo the progress producers have made.”
Rollins weighs in
During remarks at the Iowa State Fair on Aug. 21, Agriculture Secretary Brooke Rollins sought to explain why Trump made the decision. She did not say if she initially advocated for it.
“I, of course, am the president’s secretary of agriculture,” Rollins said in response to a question on beef imports. “He hears from me a lot on all of these issues, but once a decision is made, I understand the decision and defend the decision and look forward to continuing to rebuild the herd, making sure that we can continue to provide.”
On Aug. 25 during another press conference, Rollins again sought to explain why Trumps’s decision is right in the short term. She noted that the 300,000 additional metric tons of imports still won’t offset the amount of beef that would have been imported from Mexico if the border had not been close to combat New World screwworm.
Other efforts to lower beef prices.
This week, USDA begin reopening the border to cattle imports, starting with the resumption of cattle trade at the Douglas, Ariz., port or entry. If all goes well, USDA is then expected to consider opening additional points of entry in New Mexico at a later date.
During an Aug. 26 conversation with conservative radio host Glenn Beck, Trump also hinted he would be open to changing federal beef processing regulations. This comes amid an ongoing Justice Department probe into the meatpacking industry. Currently, around 85% of all U.S. cattle are purchased by just four companies.
According to data from the U.S. Bureau of Labor Statistics, beef prices are up 9% from this time last year and 47% from just five years ago.