Farm Bureau: Cattle futures drop 8% in one week

Cattle futures fell 8% last week, the American Farm Bureau Federation’s Markel Intel service said in a new study.

Farm Bureau economist Bernt Nelson attributed 7% of the fall to the Trump administration announcement that it would increase the tariff rate quota for beef from Argentina in an attempt to lower consumer beef prices. 

 “An increase to 80,000 metric tons would account for about 3.5% of the total U.S. beef import volume to date and about 0.6% of USDA’s forecasted U.S. beef consumption for 2025,” Nelson wrote.

“This amount will not have a measurable impact on prices consumers pay for beef, but the announcement has already caused future prices for feeder cattle to fall by 7%.”

Nelson noted there are many factors that are responsible for the small size of the cattle herd at the present time, but added that “interventions in the market designed to lower consumer beef prices, which have the unintended consequence of lowering the prices paid to U.S. cattle farmers” reduce the incentives to increase the herd size.