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Beef prices up 40% in 5 years…low-tariff quota to be temporarily suspended
The U.S. Donald Trump administration plans to temporarily suspend tariff restrictions on imported beef to stabilize beef prices, which have soared to record highs, the Wall Street Journal (WSJ) reported on the 11th (local time).
Citing sources, the WSJ reported that the Trump administration plans to announce measures to temporarily suspend the Tariff Rate Quota (TRQ) system applied to imported beef as early as the 11th.
TRQ is a system that imposes a low tariff on a certain volume of imports, but applies a high tariff rate to volumes exceeding that.
If this system is suspended, more imported beef can enter the U.S. at lower tariffs.
The Trump administration also plans to announce support measures for U.S. farmers and deregulation plans.
The government will instruct the Small Business Administration (SBA) to develop ways to expand loans and enhance access to capital for livestock farmers.
Some livestock regulations, such as easing protection measures for endangered wolves and mandatory electronic tags for identification, which have been long-standing grievances of the livestock industry, will also be lifted.
The background of this measure is the long-term rise in U.S. beef prices.
Over the past year or so, price increases for some foods such as eggs and milk have slowed in the U.S., but beef prices continue to rise. In particular, ground beef prices have risen by about 40% compared to five years ago.
During the COVID-19 pandemic, a sharp drop in livestock prices combined with severe drought led livestock farmers to reduce their herd sizes, and the scale of cattle farming in the U.S. decreased to its lowest level in 75 years.
On the other hand, beef demand has remained steady, exacerbating the supply shortage.
Experts anticipate that the number of cattle raised in the U.S. will significantly recover after 2028. Therefore, analysis suggests that expanding imports is unavoidable to resolve the short-term supply-demand imbalance.
The U.S. is already increasing imports from Brazil, Australia, and other regions, and this year's beef imports are expected to reach a record high of 6 billion pounds.
Brazil, the world's largest beef producer, already filled its low-tariff quota for the U.S. in January.
A White House official explained that this decision is intended to alleviate the beef supply shortage in the U.S. in the short term and will help livestock farmers reduce costs in the long term.
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