FRESHLY ordained United States president Donald Trump has doubled down on his declaration to execute plans to impose 25 percent tariffs on goods imported from Canada and Mexico on February 1.
President Trump issued a memorandum on Monday directing the US Secretary of Commerce, in consultation with the Secretary of the Treasury and the US Trade Representative to “investigate the causes of our country’s large and persistent annual trade deficits in goods, as well as the economic and national security implications and risks resulting from such deficits, and recommend appropriate measures, such as a global supplemental tariff or other policies, to remedy such deficits.”
Because the memorandum stopped short of immediately imposing any new tariffs or raising existing tariffs, it was viewed as a more measured approach than Mr Trump had suggested during the presidential campaign, trade sources in the US said.
Later on Monday, however, he told US media he was still aiming to impose 25pc tariffs on imports (including beef and live cattle) from Canada and Mexico from the start of next month, and that tariffs could also be raised on goods imported from China.
The memorandum also directed USTR to begin a public consultation process with respect to the US-Mexico-Canada Trade Agreement (USMCA) in preparation for the July 2026 review of the agreement.
USTR was also directed to “assess the impact of the USMCA on American workers, farmers, ranchers, service providers, and other businesses and make recommendations regarding the US’s participation in the agreement.”
The memorandum also directed USTR to review existing trade agreements and recommend “any revisions that may be necessary or appropriate to achieve or maintain the general level of reciprocal and mutually advantageous concessions with respect to free trade agreement partner countries.”
To this point, there has been no suggestion of new tariffs being imposed on goods from Australia, which currently operates under the AUSFTA Free-Trade Agreement, struck back in 2005.
This year, Australia has tariff-free access to the US beef market for 448,214 tonnes. While that quota number only a year or two ago might have looked extremely unlikely to ever be reached (leading to higher tariffs for the remainder of the year), it’s not implausible that the trigger level might be reached in 2025. Last year’s volume of Aussie beef to the US reached just short of 400,000t, more than 60pc higher than the previous year. The growing beef shortage in the US this year as the US national beef herd enters rebuild will only increase demand from exporters like Australia and Brazil.
USTR was also directed by the incoming US President to identify countries that offer potential for the US to negotiate agreements on a bilateral or sector-specific basis, “to obtain export market access for American workers, farmers, ranchers, service providers, and other businesses.”
More action needed before Mexican live cattle imports can resume
In other North American meat and livestock trade news, the US Department of Agriculture has called for additional steps before resuming live cattle imports from Mexico.
Trade in cattle across the border was halted last November, following the detection of New World screwworm (NWS) in Mexican cattle. The suspension is estimated to have seen about 300,000 fewer Mexican cattle enter the US market so far. The void has further pressured already record-high US feeder cattle and calf prices in recent months.
In a letter sent last week to his Mexican counterpart, outgoing US Agriculture Secretary Tom Vilsack* requested adjustments to the facilities Mexico uses to screen cattle for screwworm fly when these cattle are being exported to the United States.
Mr Vilsack said the facility improvements are a key step that is needed before USDA will resume live cattle imports from Mexico, which have been suspended since November. The US has already imposed a seven-day quarantine period on future cattle imports.
* A new US agriculture secretary is expected to be appointed by the Trump administration in coming weeks.
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