Hiltzik: Trump’s tariffs make beef prices worse

It has become common practice to resort to Trump treatment rhetoric to teach that Democrats and illegal immigrants are the source of all our problems. Beef prices rising? He looks.

Here, for example, Treasury Secretary Scott Bislent explains to Fox News on Sunday why beef prices are so high:

He said: This is a good smell, something we inherited. (This blames the Democratic part.)

He continued: “Because of the migration of so many people, the disease that we would take out of North America was going to South America. Like these immigrants, they brought some of their problems.”

As tricky as the issue can sometimes be, there is a small nugget of truth in his words, surrounded by a host of distortions.

The fact is that the USDA closed the border to Mexican livestock in March, to prevent the spread of the new global screwworm, the worst disease affecting domestic livestock, in the United States.

But the old image of migrants smuggling their infected bees across the border is telling. The USDA’s announcement of the blockade did not reduce the threat of screwworm to land supplies, whether illegal or illegal, but rather to commercial imports. The organization also noted that violations did not spread far beyond Oaxaca and Veracruz, 700 kilometers from the US border.

Spell Perisic and the Treasury Secretary could very well be seen as a general opposition to Trump.

That’s because at least some of the rise in store beef prices can be blamed on Trump’s policies, including tariffs on the United States.

Trump’s budget cuts also contributed to worsening the crisis. Agriculture Minister Brock Gollins in June announced a “five-year plan” to fight the parasite south of the border. What he can say is that the Trump administration decided in March to fund screwworm control efforts being used by the United Nations Food and Agriculture Organization as part of its creation of the U.S. Agency for International Development.

However, there are far more factors driving beef inflation than taxes and screwworms. Examining all the root causes shows that things are likely to get worse at the butcher shop before they get better. Agricultural experts say it could take years for beef prices to recover.

Roots of the beef price problem: The size of the U.S. beef herd began in 1975 and is now smaller than it has been since 1951.

(USDA)

Before we go any further, let’s take a look at the initial values. It will not be news to most consumers that beef prices have been rising for some time. The average price of raw beef reached a record high of $12.26 a pound in September, 15.2% higher than before Trump took office.

That’s the end of the long trend, though: The price was $3.64 in January 1998, according to the Bureau of Labor Statistics, meaning STUREBECH.

In recent months, big food companies have felt much more. “That beef segment remains our Achilles heel,” Donnie King, CEO of Tyson Foods, which owns Tyson Farms beef and sausages like Hillshire Farms, told investors on its fourth earnings call.

The company reported a prepared operating loss of $426 million in FICAL 2025 and a loss of $600 million was found in the financial year segment, according to the cost of cattle, the cost increased more than any other input. This means that the income he earned is protected by the benefits of chicken, which attracted buyers of bovine beef. All told, in the fiscal year ending Sept. 27, Thon reported earnings of $507 million on revenue of $54.4 billion.

This brings us to the real factors that lead to higher prices. They added up greatly. Another long-standing grudge is the size of the US cattle herd, which has fallen to 87.2 head of cattle, its lowest level since 1922.

Hay prices are expected to rise approximately 45% by 2022. As feed costs eat into the value of their herds, so do the organs of sight – which produce a small mass of their cattle like store shelves, but add up to the piece available tomorrow.

It takes at least three years to raise the animal from a calf to a legal cow. Tyson executives told investors they saw signs that ranchers were finally waking up their herds, but that meant meat shortages would continue in the coming years.

In this uncertain environment, Trump introduced another problem: tariffs. This includes a 50% tariff on Brazilian imports from Brazil, which Trump imposed as a protectionist measure, but because it was not enough with former Brazilian President Jair Bolsonaro on trial for alleged conspiracy. (Bolsonaro was convicted and sentenced in September to more than 27 years in prison.)

This was a problem, because although foreign meat does not represent a large portion of beef consumption, it is important in other categories,” which is combined with Fattier US BEEMET, and Brazil’s production of Lean Trim has helped beef exports reach more than 25% of all US beef products.

The long-term rise in beef prices has market participants wanting to point fingers, but it’s all unfounded. In 2019, consumer advocates accused Tyson, Cargill and other meatpackers of conspiring to fix beef prices. Tyson and Cargill settled the charges last month without admitting guilt, paying $55 million and Cargill $33.5 million. Two foreign-owned companies, JBS USA and National Meatpacking, are appearing in court.

Others showed themselves to be prophets of cattle breeders, and their profit per animal was very high, as many accumulated the size of their herds.

One could also point to American consumers, who did not spend enough of their money to buy beef to get out of the economic crisis.

Managing rising beef prices has been messy and unpopular. Last month, Trump said he would limit price increases by importing more beef from Argentina.

A proposed sand slush project is close to American livestock producers. They said the plan “only creates chaos at a critical time of the year for American cattle producers, while doing nothing to lower store prices,” said Colin Kalal, national director of beef for the Ranchers. The group noted that Argentine beef represents 2% of US beef, meaning that even a significant expansion in trade flows would reduce prices.

Price, there is not much Trump can do to affect beef prices, without making the situation worse, as is the case with his taxes. Now that he has reversed course and given Brazil the nod to trade, prices may improve, if only modestly. But all those other factors, like drought, long-term declines in herd numbers, and diseases, are going to be with us for some time.