A monthly column written for Beef Central by US cattle and beef markets commentator Steve Kay, publisher of US Cattle Buyers Weekly
THE threat of or imposition of enormous tariffs on goods and services imported into the US from numerous countries dominated the first seven months of the Trump Administration.
President Trump used tariff threats to extract trade deals from the European Union, Japan and Indonesia. But the threat of new tariffs still hangs over imports from Canada and Mexico, while a huge 50 percent tariff was imposed on August 1 on numerous imports from Brazil, including beef and coffee.
The imposition of the Brazil tariff will have the most impact on the US beef supply so far. But the threat of tariffs against Canada and Mexico means the US beef industry remains at risk from tariffs on live cattle and beef imports.
They would obviously increase the price of animals entering the US for feeding or for direct slaughter. Imports of feeder cattle from Mexico are still suspended due to New World screwworm disease.
For the year to August 1, they totaled 230,00 head, versus 863,000 head in the same period last year. For the year to July 26, the US imported from Canada 418,000 cattle for feeding or slaughter.
The tariff on imported Brazilian beef could not come at a worse time
The tariff on imported Brazilian beef could not come at a worse time. US beef imports soared in May, reflecting the ongoing demand for lean manufacturing beef used for hamburgers.
Imports totalled 250,000 tonnes, more than 60pc higher year-over-year and the second highest monthly import total behind January of this year, says USDA’s Economic Research Service.
Brazil was the largest contributor to the increase with imports of 79,000t, more than five times the amount imported in May 2024. Year-to-date imports from Brazil are more than double the same period last year at 302,000t. Volume was up 347pc year-over-year.
However, these imports have now disappeared because of the imposition of the new tariff on many Brazilian imports on August 1. Brazil could lose at least $1.3 billion worth of beef and livestock product sales to the US in the second half of 2025 unless the nation can negotiate some relief from the additional tariff, says the Brazilian Meat Packers Association.
As Beef Central has reported, the imposition of an additional 50pc tariff on top of an existing tariff of 26.4pc would take the tariff total to 76.4pc. Trade would be unviable under those terms, said trade analysts inside and outside Brazil before the new tariff was introduced.
The US is now Brazil’s second largest beef export destination after China. January through May, the US imported 165,000t of Brazilian beef, up 85pc on the same period last year.
The Brazilian government on July 22 sent a formal message to Washington expressing its indignation over the additional tariff imposed on Brazilian exports. At the same time, the letter signaled Brazil’s willingness to engage in dialogue with US authorities and negotiate a mutually acceptable solution. With no Brazilian beef entering the US, end-users like small hamburger chains and small grocery stores will be most impacted, as nearly all the Brazilian beef was lean manufacturing beef.
Australia lifts US, Canadian import restrictions
As widely reported, Australia is lifting its restrictions on imports of US beef, allowing fresh and frozen products to enter the country. However, the move is largely symbolic, as little US beef is likely to be exported there until US cattle numbers and beef production increase significantly, as Beef Central also has reported.
A US-Australia Free Trade Agreement took effect in 2005 and was intended to allow US beef to be sold in Australia. But Australia used numerous tactics to deny access, which angered and frustrated US beef industry organisations. It finally relented, saying it is satisfied with traceability programs put in place by the US industry. Not surprisingly, the Australian beef industry immediately called for a review of the process.
Meanwhile, the Trump administration struck trade deals with Japan and Indonesia that are favorable to the US meat industry. The US Meat Export Federation said it greatly appreciates the Trump administration’s new trade agreement with Japan, which reassures and expands opportunities in the second largest export destination for US beef and pork.
Trump announced what he called a “massive” deal with Japan that includes reciprocal tariffs of 15pc on the country’s exports to the US, with auto duties reportedly being lowered to that level.
In a post on Truth Social, Trump said Japan would invest $550 billion in the US and the US would “receive 90pc of the profits.” Trump also said that Japan will “open their Country to Trade, including cars and trucks, rice and certain other agricultural products, and other things.”
In President Trump’s first term, the critical US-Japan Trade Agreement was reached. This returned US red meat to a level playing field in Japan (referring to earlier age limitations based on BSE concerns) and restored its position as an extremely reliable market, said USMEF.
In another trade development, the US and the Republic of Indonesia reached a “landmark trade deal” on July 22, according to an announcement from the White House. The Agreement on Reciprocal Trade will provide both countries’ exporters with “unprecedented access” to the other’s markets, the White House said.