Global AgriTrends

12.11.25

Weekly Global and U.S. Cattle/Beef Update

Trump on Meat/Livestock:

See my comments below about the president’s intentions and possibility for a Mexico border opening.

Note that the Trump Administration announced a $12 billion “Farm Bridge Assistance” program for row crop farmers (soybeans and corn) due to higher input costs and affected by China tariffs. Distribution will begin in February as an aid to help spur 2026 planting decisions. Note that cheaper feed has feedlot cost of gains around the 82 cent/lb range while fed cattle continue trading around $2.21/lb; thus the STRONG signal to "make 'em bigger".

Trump threatened additional 5% tariffs on Mexico this week over a 1944 water treaty with Mexico, unless they release 200,000 acre-feet of water by December 31st. Mexico already has 25% tariffs but only on goods falling outside of the USMCA agreement; that means only around 10% of Mexican imports face a tariff. I expect they will comply with the water request.

The U.S. Federal Reserve board voted yesterday to cut interest rates by 0.25%. That will be seen as bullish for equity and financial markets and is broadly inflationary.

Beef Market Update

Carcass weights continue higher, at 988 pounds last week. That is now 36 pounds above a year ago and 52 pounds above two years ago. That adds 3.6% in beef production versus a year ago. Note that beef production (even with those big weights) has averaged -3.3% in November. That means sharply lower slaughter rates. Steer/heifer slaughter averaged -7.1% the first three weeks of November and has averaged -7.5% lower since April. So carcass weights have masked about half of the impact of smaller cattle supplies.

The closure of the Mexican border will begin impacting supplies more severely going forward. Most of those imports are light weight feeder cattle that don’t reach slaughter weights for 10-14 months, depending on the route they take (grazing, then feeding). Note the timing of the border closures: initial border closure on November 22, 2024 (which reopened partially in February, but then re-closed in May), reopened from July 7-9, then closed, remaining closed today. That suggests the impact of those lost Mexican cattle wouldn’t really be felt until recently with the hard closure not felt until next spring/summer. Mexican feeder imports at 1.3 million per year equate to 5% of steer/heifer slaughter the past three years. That impact on production is now just beginning but will become more severe into next spring, UNLESS the border is opened.

Odds of a Mexican border reopening?

Note that USDA has aggressively moved to assist Mexico in halting the fly movements, including a $21 million investment into a sterile fly facility in Tampico and a new sterile fly facility at Moore Air Force base in Texas. There have still been 11 cases in Mexican border states. It would seem risky to open the border in that situation. Mexican officials have proposed opening trade from lower risk (no cases) states including Sonora and Chihuahua. And import protocols including cattle dips, pre-inspection for wounds, and initial quarantines have been proposed and considered. Also note that screwworm flies are a tropical fly; at 61 degrees Fahrenheit flight ceases and at 50 degrees adult flies die within days.

Perhaps the biggest factor to consider is President Trump’s drive for cheaper U.S. beef prices. When you add that all up, a winter opening (possibly January) could be on tap for a few lower risk border crossings. U.S. ag secretary Brook Rollins has said that any reopening would be phased with only limited port openings. My guess: get ready for some Mexican cattle in early 2026, possibly January. But that is a GUESS…

The smaller beef production is leading to smaller export volumes. In the recent (yet delayed) September export data, beef exports were down -24% from a year ago (now down -11% YTD). The biggest driver of softer exports is the prolonged closure of the China market (since March).

We continue to expect tightening U.S. cattle and beef prices to spur new record pricing in 2026. This will be exacerbated by expected herd rebuilds and tightening supplies in Australia and Brazil.