Brazil Fills Tariff-Free Beef Quota for 2026 in Record Time
BRAZIL has officially filled its tariff-free beef quota access into the United States for the 2026 calendar year—and done it in record time. The latest weekly report from the US Customs and Border Protection Service confirms that Brazil, operating under the modest ‘Other Country’ MBN quota, reached its quota entitlement as of January 6.
Impacts of the Quota Filling
This rapid filling means that for the rest of the year, Brazilian beef imports into the US will be subject to a 26.4% out-of-quota tariff, which will diminish its competitiveness against suppliers from Australia, New Zealand, and other nations.
Quota Reduction
The ‘Other Country’ quota, already limited to just 65,000 tonnes, has been further restricted this year. In a surprising move, US President Trump allocated 13,000 tonnes of this quota specifically to the United Kingdom, in exchange for reciprocal access for US beef into the UK. This decision effectively shrinks the quota available for Brazil and other countries to just 52,000 tonnes, accelerating the Brazilian quota utilization.
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Factors Influencing Quota Usage
Additionally, Brazilian beef held in US bonded cold storage was a contributing factor this year, as both exporters and importers aimed to mitigate the impact of tariffs, albeit temporarily.
Global Meat Trade Dynamics
The 2026 international beef trading year has only just commenced, yet quota limitations and tariff implications are already shaping the global meat market dynamics, and are expected to continue doing so for the next 11 months.
Comparison with Other Exporters
Brazil’s access is significantly restricted without a Free Trade Agreement (FTA) with the US. In contrast, Australia benefits from a bilateral FTA quota that allows for 378,214 tonnes into the US this year, of which only 10,660 tonnes (2.82%) had been filled by January 12.
Historical Quota Filling Rates
Last year, Brazil filled its 2025 quota by January 17, while the trigger was reached in March in 2024 and May in 2023. These trends indicate a pattern of increasing urgency as global demand shifts.
Current US Beef Supply Challenges
The US is currently facing severe domestic beef shortages at the beginning of 2026. According to Derrell Peel, a commentator on meat and livestock markets from Oklahoma State University, the USDA’s December Cattle on Feed report shows a feedlot inventory of 11.727 million head, a 2.1% decrease year-on-year and the smallest inventory recorded for December since 2017.
Feedlot Inventory Declines
Feedlot inventories have now declined year-over-year for 13 consecutive months, resulting in the lowest 12-month moving average since October 2018. This decline, while gradual, masks sharper reductions in placements and marketings. For instance, feedlot placements in November were down 11.2% compared to a year ago, and the last six months saw an 8.6% decrease.
Looking Ahead
The outlook for feedlot placements and marketings remains bleak, as they have reached lows not seen since 2016. Since late 2025, average placements and marketings have further contracted due to tightening feeder supplies, compounded by a reduction in Mexican cattle imports.
As the year unfolds, the implications surrounding tariffs and quotas will undoubtedly continue to influence the dynamics of the beef market, affecting both producers and consumers alike.
