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Trade4go
Apr 11th, 2025
Original content
The recent decision by the United States (US) to impose a 10% tariff on all Argentine exports to the country, part of a broader protectionist shift, could have significant consequences for Argentina’s beef sector. Although the tariff is among the lowest applied and aligns with those placed on other US beef sources, such as Brazil and Australia, it acts as a de facto export tax, potentially reducing Argentina’s competitiveness. This is particularly concerning given the recent growth in Argentine beef exports to the US, which had become the fourth most important destination for the product by early 2025, according to the Argentine Meat Exporters Consortium (ABC). While the overall volume of food trade between the two countries remains relatively modest, beef stands out as a sector with strong momentum. As a result, the new tariff may dampen this positive trend, posing risks for exporters and threatening to exclude Argentine beef from a strategically important and growing market.
Albania has officially opened its market to Argentine beef for human consumption (excluding mechanically separated beef) and approved the required International Veterinary Certificate (IVC). Only Argentine plants authorized to export to the European Union (EU) under the pre-listing system will be eligible. This adds to Argentina’s growing beef export markets, with over 934 thousand metric tons (mt) certified for export in 2024 to destinations including China, Israel, Russia, the US, and Germany.
The United States Department of Agriculture (USDA) projects that Australian beef production will reach 2.65 million metric tons (mmt) in 2025, marking a 2.6% increase from 2024 and making it the third-highest production year on record. This growth is fueled by sustained high female slaughter rates and increased feedlot production, which are expected to raise slaughter weights. Exports are also anticipated to hit a new record, with a 2.5% rise in 2025 compared to 2024, reaching 1.95 mmt. The USDA indicates that the high beef demand from the US amidst supply constraints will drive a greater need for Australian beef, further boosting export trends. These factors underscore Australia's continued dominance in the global meat trade.
According to the General Administration of Customs of the People's Republic of China (GACC), beef imports to China saw an 11% year-on-year (YoY) decline in the first two months, totaling 468 thousand mt, with most beef-exporting countries reducing their shipments. However, Australia and the US saw significant growth. Australia's exports of frozen boneless beef rose by 53% YoY, and frozen bone-in beef by 38% YoY, though chilled beef imports decreased by 8% YoY. US frozen boneless beef increased by 17% YoY and chilled beef rose by 15% YoY. Despite this US shipment growth, the suspension of licenses for 350 US plants in mid-Mar-25 and tariff hikes is expected to affect exports to China. Meanwhile, South American beef exports to China suffered a downturn, with Brazilian shipments down by 10% YoY, Argentine boneless beef imports falling by 33% YoY, and Uruguayan imports of frozen bone-in and boneless meat declining by 36% YoY and 38% YoY, respectively. Additionally, Colombia emerged as a new beef supplier to China, exporting 6.14 thousand mt of frozen beef during the same period.
Paraguay's beef exports reached 90.62 thousand mt, valued at USD 509.86 million in Q1-2025, marking a significant 31.15% rise in volume and a remarkable 53.08% increase in value compared to Q1-2024. Bovine offal also experienced a surge, with revenue surging by over 108% YoY, totaling USD 33.85 million from 18.80 thousand mt exported. The overall exports of animal products and by-products reached USD 628.58 million, a 45.98% YoY increase in value, with key markets including Chile, Taiwan, and the US. Despite positive growth, the Paraguayan meat sector faces uncertainties due to potential protectionist measures from the US government. To mitigate risks, Paraguay is exploring alternative markets, such as Saudi Arabia, Brazil, and Colombia, and capitalizing on growth opportunities in specialized meat segments.
According to the Ministry of Economy and Finance (MEF), Uruguay's beef exports to the US paid USD 92 million in tariffs out of a total of USD 105 million across all products in 2024. This figure could increase due to new trade measures announced by the US administration, raising the tariff from 26.4% to 36.4% for beef exports exceeding the 20 thousand mt quota. If not mitigated, Uruguay could face an additional USD 61 million in tariffs, impacting its USD 615 million beef export market.
In W14, Brazil's wholesale boneless rear beef price decreased by 3.41% week-on-week (WoW) to USD 4.82 per kilogram (kg), marking its first drop since W10. This decline also represented a 0.41% month-on-month (MoM) decrease and a 0.21% YoY drop. However, despite the price drop in USD, the price remained stable in local currency at BRL 28.50/kg, reflecting the impact of currency exchange fluctuations. According to Safras and Mercado, the wholesale market showed firm prices for beef, with expectations for price increases in the short term. This is driven by anticipated strong meat sales during the first half of Apr-25 and the higher consumption potential around the Easter holiday. Safras and Mercado also noted that the business environment remains favorable, with slaughter scales significantly shortened, and demand staying robust due to the influx of salaries and the seasonal boost from Easter holiday consumption. Additionally, exports are performing well, with expectations for another record shipment this season.
Australia's National Young Cattle Indicator averaged USD 2.36/kg in W14, marking a 6.79% WoW increase, an 8.26% MoM rise, and a 9.26% YoY gain. Meat and Livestock Australia (MLA) reported strong movement in the cattle market, influenced by ongoing rainfall and severe flooding in some western Queensland regions, which drastically reduced cattle supply. Despite this, demand remained stable, contributing to the price increase. Yardings fell by 22 thousand heads to 49.27 thousand heads, with Victoria and Western Australia being the only states to see increases, while New South Wales and Queensland experienced significant reductions of 40% and 64%, respectively. The Processor Cow Indicator also benefited from strong demand and limited supply, with the closure of several saleyards in Queensland intensifying competition across national saleyards as processor demand for cows remained high.
In W14, US lean beef (92% to 94% lean) reached a record wholesale average of USD 8.85/kg, reflecting a modest 0.45% WoW rise, a 0.68% MoM increase, and a notable 14.49% YoY surge. This price spike is largely driven by tightening domestic supply amid continued contraction of the US cow herd. According to the USDA, the total cattle and calf inventory dropped to 86.7 million heads as of January 1, 2025, down 0.6% YoY and marking the sixth consecutive year of decline. Consequently, US beef production is projected to fall by 4.4% YoY in 2025, while per capita consumption is expected to decline by 2.68% YoY to 58 pounds (lbs) per person. The situation is further strained by trade uncertainties, including the newly implemented 10% baseline tariff on all imports and higher rates for countries with which the US has trade deficits. This tariff implementation could disrupt import flows and intensify supply shortages in the US market.
To mitigate the impact of the newly imposed 10% US tariff, countries like Argentina, Paraguay, and Uruguay should prioritize diversifying their beef export markets and expanding their customer bases. For instance, Argentina should focus on high-growth regions with increasing demand for premium beef, such as Southeast Asia, the Middle East, and parts of Europe, while also leveraging new opportunities like Albania. Paraguay should look to capitalize on emerging markets like Saudi Arabia and Brazil, while also strengthening trade ties with Colombia. Known for its high-quality beef, Uruguay should emphasize its reputation in European markets where demand for premium beef continues to rise. By targeting markets with fewer trade barriers, these countries can reduce their dependency on the US and better secure their beef export revenues.
Given the projected increase in beef production in Australia, it is crucial for the Australian beef industry to capitalize on this growth by strengthening its relationships with high-demand markets, particularly the US. Expanding production and feedlot capabilities can meet the increased demand while maintaining high-quality standards. Australia should also explore the potential for exporting to new regions, including emerging markets in Asia and Africa, where beef consumption is rising. As the US struggles with supply constraints amidst growing beef demand, Australian exporters should consider strategic partnerships with US-based distributors to further secure their position in this lucrative market.
Sources: Tridge, Agromeat
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