NASHVILLE, TENN. (RFD-TV) — When egg prices skyrocketed earlier this year, consumers had no substitutes — and the government had no easy fixes. But as beef prices stay near record highs and imported lean trimmings grow scarce, some are asking if the same market squeeze could happen again.
With roughly 250,000 Mexican cattle stalled at the southern border due to the ongoing New World Screwworm outbreak, Rollins says the USDA is taking a “not yet” approach to reopening crossings until the risk is fully contained.
Agriculture Secretary Brooke Rollins says that while cattle are waiting to cross the U.S.-Mexico border, now is not the right time— that is, as the U.S. Department of Agriculture (USDA) continues working to keep the New World Screwworm from crossing the southern border with those cattle from Mexico.
“Just a few weeks ago, we had one that was identified 70 miles from the Texas border, so we, obviously, take this incredibly seriously,” Secretary Rollins said to the media last week at the National FFA Convention in Indianapolis. “We released a five-point plan. I’ve been down to the border now, announcing a new sterile fly facility. So, we will continue the conversations. We are not there yet. Obviously, in Mexico, there are about 250,000 head of cattle waiting to move over, but I am not convinced yet that we have this under control.”
However, without an agreement between ag leaders from the U.S. and Mexico to reopen cattle crossings at the border, and a significant drop in imports from Brazil due to President Donald Trump’s tariff-based trade strategy, which will be under review by the Supreme Court this week, a widening import gap has emerged.
According to Steve Dittmer, Executive Vice President of the Agribusiness Freedom Foundation, ground beef has become the nation’s most versatile and affordable cut. Still, that popularity now depends heavily on imported lean beef to meet demand, and he says producers cannot currently keep up with domestic demand and rely on imported trimmings.
“So, I think it’s no surprise to everyone in the audience that we are facing a potential crisis with our animal livestock industry, with the screwworm,” Dittmer said. “However, the screwworm, after devastating the American livestock industry in the 1950s and 1960s, took more than a decade to get back out in front of it. We thought it had been eradicated. It had moved all the way back down into South America and has slowly been creeping up.”
Imports now make up around 10 percent of the U.S. beef supply, and economists say they are crucial to meeting consumer demand. In previous years, the majority of those imports came from Mexico and Brazil. While American cattle producers hoped to have the space and support to rebuild the cattle herd and meet that need — including an overall reduction in beef imports — persistently low herd numbers and consumer beef prices hovering near record highs are pushing trade leaders to look for new sources.
The White House has considered importing more beef to supplement the U.S. supply, and economists say it is likely needed to meet growing demand for ground beef. However, the idea sparked fury among most American cattle producers — following news of a big bailout for the country and a shocking coup of soybean sales to China — as well as confusion among economists who argue that even quadrupling Argentine beef imports would do little to ease consumer prices.
Demand Steady for Angus Despite Price Pressure, Market Pessimism
In response, we have seen the cattle market flipped on its head in a matter of days, dominating our market discussions in the last couple of weeks.
According to market analyst Cassie Fish, the speed of the decline has been unlike anything seen before. She said that many in the beef market are not focusing on facts but rather on emotions, making it difficult for the futures market.
“It certainly is very disconcerting — these kinds of dramatic declines,” explained Cassie Fish. “We’ve seen an almost 10 percent decline in December live cattle and 11.6 percent in November feeders. It started on the Seventeenth of October, so that is an incredible speed that we have never really seen before, of this magnitude. And unfortunately, people have lost confidence — certainly in the futures market — and there continues to be some nervousness about additional headlines. You know, if they ease the tariffs on Brazil, for example.”
Fish says despite all the noise, the fundamentals have not changed, and U.S. cattle supply will remain extremely tight heading into next year.
“We have the tightest supply of the entire bull market cycle right in front of us — November into next summer — and the first quarter will be excruciatingly tight,” she said. “But people do remember, you know, the market topped in the fourth quarter of 2014 and went down during 2015, and that was when we also had our tightest numbers. Now, we do not have the same demand we had then; demand was poor in 2015. Demand has been excellent despite the fact that we do have record-high prices. We’ve had incredible beef demand for all categories of beef.”
In reality, consumers are continuing to pay high beef prices, especially for quality cuts of American beef — and the Certified Angus Beef (CAB) brand delivered another powerhouse year.
CAB sold 1.235 billion pounds globally as retail beef averaged $8/lb, with U.S. beef demand hitting a 40-year high. Supply stayed tight — certified carcasses fell 2.9% — yet ranchers still delivered 5.77 million qualifying carcasses at a 37.6% acceptance rate. CAB Prime set a new benchmark at 783,000 carcasses (+3.6%).
Foodservice moved 417 million pounds — second-best ever — including a 40.3 million-pound record March. Retailers sold 525 million pounds of ground beef, up 6% from the prior year, and CAB Prime, up 5.6%. Value-added items — deli meats, shaved steak, hot-pot rolls — climbed 9.7%, meeting time-pressed shoppers where they are. International sales reached 179 million pounds across 55+ countries, led by Canada, South Korea, and Mexico. Niche lines — CAB Grass-Fed, Natural, and Ranch to Table — added momentum.
CAB President John Stika, speaking at its annual convention over the weekend, said brand partners are sending “a loud, economic signal” back to cattle country — reinforcing the payoff for genetics and management focused on premium quality.
Why Ground Beef Won’t Become the Next Egg Shortage
Senator Cindy Hyde-Smith (R-MS) said her office has fielded countless calls since President Donald Trump floated the idea of more beef imports from Argentina. She believes the market needs to address itself...and notes that the argument is not the same as when egg prices went through the roof earlier this year.
“You can’t replace an egg with anything else. You eat the egg. It goes in cakes. It goes in pies. It goes in bread. You know, you can’t replace that with anything else,” Sen. Hyde-Smith said. “And I understand, you know, and of course, the High-Path Avian Influenza (HPAI) played a factor in that, and I understand we’ve got some concern about that again in a few countries right now. But just getting him to the point of saying, ‘We know what you’re trying to do, but this market needs to be a true market, without any intervention from the government.’ And there are other choices, unlike eggs.”
Dr. Jada Thompson, a cattle economist with the University of Arkansas, has been watching the action with beef prices, availability, and the New World Screwworm threat. She says prevention is always the best course of action and usually costs less.
“Prevention is always less costly than reaction,” Dr. Thompson explained. “So if we’re being reactionary, it is going to cost us more and be less effective than if we can prevent that disease. So, if we can [stop] the disease from entering the U.S., if we can prevent it from spreading in Mexico, if we can prevent it from getting into Mexico more, and we can move — prevention is going to be less costly in general than reaction to it.”
Taxpayers this year have dished out a lot of money to keep the New World Screwworm out of the U.S., including the construction of a $750 million facility in Texas to produce sterile flies.
