NASHVILLE, TENN. (RFD NEWS) — Top of mind for ranchers is whether and when cattle from Mexico will once again be allowed to cross the southern U.S. border.
Last week, Agriculture Secretary Rollins said talks to reopen trade are underway. Secretary Rollins says she expects an announcement on the border next month. She says it would be a phased-in approach. Rollins says USDA is also eyeing a mid-April opening date for a new sterile fly production facility in South Texas. However, one market analyst warns that it is unlikely to happen anytime soon.
“To me, I think there are some political issues,” he said.” I also believe that some of the internal interests in Mexico certainly want to keep those cattle at home. I think the packing industries made a lot of money off those cattle not being able to move to the U.S. So, I think there’s limited desire on their side to allow those cattle to come north. And from the U.S., from a risk standpoint, you know, I don’t know on the science side, but to me, I just don’t know that the benefit outweighs the risk.”
When Mexican cattle are once again approved for import to the U.S., he says it won’t start at the levels seen when the ban was implemented.
“Yeah, that would be our guess, because Mexico is in the process of, as we’re told, expanding some of their packing capacity down there, as well as building more feed bunks and obviously being able to mitigate this kind of situation for the future.”
One Texas cattleman says while the ongoing threat of the New World screwworm remains serious, producers need ports reopened.
“Number one, we can find a way to reopen those cattle, bring them here, and raise them to our standards with our feed and with our vaccination schedules and the way we operate in America. Or if we continue waiting, we will end up receiving boxed beef from Mexico, raised the way they want to raise it, processed in their processing plants, boxed. And then there’s no way to shut that off because there are no flies when it comes to frozen boxed beef. So, at this point, we’re at a crossroads. Do we want to put in place a safe process, continue to open that border, and bring in live cattle that we can foster and make sure are raised correctly? Or are we going to wait and let these guys get their processing plants built, and then they’re going to be the ones that dictate the price and how they’re raised and how they’re finished and how they’re slaughtered and how they’re packaged? I think it’s wise for us to figure out a way to get live cattle here as soon as we can.”
As beef prices continue to rise due to tighter domestic supply, Wells says something needs to change—whether it’s reopening the border or exploring another option.
“I know a lot of cow calf guys are going to get mad at me for saying this, and that’s fine. They can get mad. They know that they’re high and it’s okay for us to make money,” Wells said. “I’m not saying we don’t need to make money. We don’t need to go back to five-year pricing. I don’t want anyone to have to go back to 70-cent cull cows. I mean, that’s not what we’re talking about here. But we do have to get a hold of this before this system crashes around us, and people say, ‘I can’t afford beef. I’m not going to buy beef, and it’s not going to be part of my life anymore.’” Wells said. “And that’s going to be where we’re headed at some point, some price point. People are just not going to be able to afford it. So we’re going to run this train too far down the track if we run beef prices too high. And then it’s going to come back crashing around our heads if we don’t figure out a way to slow it down, balance this out so that nobody loses their shirt, so to speak, no one loses the farm, and we’re able to work together to come to a level that we could all make money at. without one broken one way or the other.”
Rising Number of Cattle in Drought As Forage Supplies Tighten
Drought conditions across the U.S. cattle country are also taking a toll. Brady Huck tells us that some areas are currently in severe drought.
“We’re seeing 64% percent of cattle in drought -- that area continues to expand, and the intensity of that drought is also increasing,” Huck said. “Thirty-nine percent of the cattle and drought are in a severe drought, versus the beginning of the year, when less than 10 percent were in severe drought. So, the intensity of the drought continues to expand as well as the area. And we desperately need some help here out in the west. And we’ve kind of got a story unfolding where the west is dry, and will the north and the east be wet as we enter spring? So, we’re entering silly season, and that’s what’s going to drive your markets. We’re watching the weather every day.”
“Silly season” in cattle farming refers to the chaotic, high-intensity period in late spring or late autumn characterized by high-volume cattle sales, peak slaughter rates, and increased market volatility before holiday shutdowns. It often involves intense, round-the-clock labor for producers who handle large numbers of animals.
Hotspots for drought right now include the central Rockies and Southern Plains, with Nebraska seeing about 94 percent of its cattle regions affected, where pasturelands were recently scorched by historic wildfires, causing major strain to grazing resources.
MOU on Grazing Access Aims to Help Ranchers Cut Costs, Red Tape
However, a new Memorandum of Understanding (MOU) regarding the “grazing action plan” between the USDA and the Interior Department was signed last week. Agriculture Secretary Brooke Rollins says the agreement will improve coordination of federal grazing lands and expand access for ranchers, aimed at boosting the nation’s beef supply.
“There are approximately 29,000 grazing allotments on federal lands, and while many are active, approximately 10% are vacant across both the Forest Service and the BLM (Bureau of Land Management), amounting to 24 million additional acres that are available,” Rollins said. “We know that economic opportunities are already there. Livestock grazing on Forest Service land supports 14,000 jobs and generates $645 million to our national GDP annually. And across Western rangelands, livestock grazing on BLM land generates $2.7 billion in total economic output, supporting 35,000 jobs.”
Rollins says the move is a critical component of a broader initiative to fortify the beef supply and rebuild the national cattle herd.
“Back in the fall, with Secretary Burgum and others, we launched our plan to fortify the beef supply and rebuild the herd, lower costs, and ensure ranchers can have the same opportunities to thrive for generations to come,” Rollins said. “Since last fall, we have seen positive signs. Beef cull cow slaughter is declining faster than historic seasonal averages. The January cattle inventory reported a year-over-year increase in both heifers held as replacements and heifers expected to calve. These are encouraging early indicators that American ranchers are taking the first steps toward retaining cattle and expanding the domestic herd.” Interior Secretary Doug Burgum says the MOU creates a “single point of contact” for ranchers, replacing the previous system of handling two separate departmental approaches. He says this will help lower operational costs for ranchers.
NCBA on Farm Bill and Direct Sales Measures
The National Cattlemen’s Beef Association (NCBA) continues to push priorities in Washington, D.C., including expanding meat-processing capacity and improving access for smaller processors and consumers.
“What we’re seeing now is that some of those businesses have survived. Some of them haven’t. That is the nature of, you know, getting a plant off the ground. They’re very capital-intensive, and we’re in a really tough part of the cattle cycle right now for them to get open and stay open. But what we’re hearing now most from our producers and our members, who obviously overwhelmingly come from the cow-calf space, is I just want to see more ways that these plants and some of these smaller operators can sell to consumers in my backyard.”
NCBA is also advocating for the DIRECT Act, or Direct Interstate Retail Exemption, which could allow state-inspected plants participating in certain programs to sell across state lines under specific conditions.
“We are working on getting a House companion introduced in short order here. But this is basically a bill that would allow those state-inspected plants, folks who are participating in an MPI program within their state, to sell across state lines under certain conditions.”
If passed, NCBA says the legislation could significantly benefit small and mid-sized processors, many of which have been limited by interstate commerce restrictions despite meeting rigorous state inspection standards that often mirror USDA requirements.
LRP Insurance Gains Use As Cattle Market Risk Tool
Livestock Risk Protection (LRP) insurance is gaining traction among cattle producers as a flexible tool to manage price risk in a volatile market.
The Texas & Southwestern Cattle Raisers Association says LRP allows producers to hedge actual herd sizes rather than relying on standardized futures contracts, offering a more tailored approach to risk management. The program uses feeder cattle index pricing, which helps reduce basis risk and better align coverage with real market conditions.
LRP also offers cash flow advantages. Premiums are not due until the end of the coverage period, meaning producers only pay if market prices remain above insured levels. If prices fall, indemnity payments help offset losses, making the tool more accessible for operations with limited capital.
As cattle inventories remain historically low, risk management tools are becoming increasingly important for maintaining stability and supporting future herd expansion. TSCRA has adopted a policy supporting LRP expansion, including consideration for bred heifer and cow coverage.
However, concerns remain about program oversight and potential impacts on futures markets, particularly during large indemnity events and audit requirements.
