Tariffs coming off could see a squeeze

Beef tariffs are back in the news in the US, where the cost of hamburgers is a major talking point. Here we look at where the US gets its beef and how our exports stack up against competitors.

The latest movement in the beef trade in the US was the waiving of tariffs on out of quota beef imports. It was announced last week that on September 1 the US would be allowing 300,000 tonnes of beef trimmings to enter the US duty free for 90 days.

Initially the White House suggested imports during the period would be potentially sold 25% below market price, but the trade is awaiting confirmation on specific details around this announcement.

Australia has yet to reach its quota of beef exports to the US. Australia’s total quota for beef is 450,000 tonnes, and as of the 27^th of August, we had exported 385,952 tonnes. On average in 2026 Australia has been exporting 41,500 tonnes per month, so with just 64,000 tonnes of quota left, its likely we will have more negatives than benefits from this move.

Brazil stands to benefit more from the tariff relief. Brazil filled their US quota earlier this year and have been paying a 26.4% tariff on exports to the US since their quota filled. There is some concern that the removal of the tariff, at a time when Brazil are close to filling their China quota, will see Brazilian beef displace Australian beef in US markets.

Figure 1 shows USDA beef import data. We can see that imports from Brazil are erratic, and seemingly peak early in the year as processors scramble to fill quotas. Imports from Australia are relatively steady.

In terms of price, figure 2 shows that Australian beef generally commands a higher price in the US. It should be noted that the price is for all frozen beef exported. Tariffs are not included in this price data, so out of quota Brazilian beef was effectively costing consumers $US7.76/kg in June, which is not far off the $US8.21/kg of Australian beef.

There are some reports that Brazil will be able to supply 100,000 tonnes per month to the US, as they shift away from China but there are some logistical and timing challenges in doing this. Steiner Consulting are saying we will definitely see market distortions and given that the beef can be held in cold storage for some time, the distortion may run well into 2027.

What does this mean?

Our beef export prices to the US were falling before the latest announcement, and following the announcement they were lower again, albeit on slow volumes. With processors being hit by the quotas in China and South Korea, and now likely more competition from Brazil a price squeeze could emerge.

US cattle ranchers are not happy with the decision, which could lead to some changes, as nothing is seemingly set in stone these days.

The Bottom Line

• Out of quota tariff relief is designed to bring down burger prices in the US.

• Brazil will be the major beneficiary of removed tariffs as they are out of quota.

• More competition for exports into the US is negative for processor margins and cattle prices here.

 Angus Brown brings over 20 years of expertise analysing Australian agricultural markets, and also runs a mixed farming operation in Hamilton, Victoria.