AUSTRALIAN beef trade into the United States since Trump’s 3 April (local time) tariff announcements has gotten off to a surprisingly slow start.
On Friday, Urner Barry reported Australian/NZ blended cow 90s at a record high US334-338c/lb, FOB port of entry. However, that price quote masks the fact that trade volume last week and this morning into the US has been thin.
Some offer prices (not sale prices) quoted in industry circles this morning had imported 90s at US350c/lb, and domestic 90s at 380c. Clearly, current record high prices being quoted on lean imported trimmings into the US are now factoring in the new 10pc US tariff.
The premium for US domestic manufacturing beef over imported has also declined dramatically over the past 10 days since US president Donald Trump’s tariff announcements on 3 April.
US domestic fresh trimmings were trading as much as US80c/lb above equivalent imported product only a few weeks ago, but that gap has now narrowed to a more conventional level of just 30c/lb, as the full effects of tariff developments take effect.
“US participants in the imported beef sector continued to seek pricing references in an unsettled market,” Urner Barry’s Comtell report said on Friday. “Of the trade that was occurring, sellers have different approaches to the market, with some immediately reflecting the full value of new tariff rates in their nearby offerings, while others walk prices up and offer higher levels in forward time slots,” UB said.
“All of this had mixed levels of success with buyers. This contributes to wide price spreads and irregular pricing relationships between some listed items.”
Part of the slow response in buying out of the US trade since 3 April may be explained by the fact that Australian product currently on the water to the US, shipped up to 4 April (bill of lading) and due to arrive in US ports by 27 May, is exempt from Trump’s new 10pc tariff. It means that for a few weeks, that may mask any sudden rise in demand out of the US as the tariff impact starts to take hold, traders told Beef Central this morning.
The trimmings and general beef marketing into the US continues to be described by the trade as ‘unsettled’, ‘confused’ and ‘erratic’ this morning.
“It’s still a bit of a Mexican standoff – there hasn’t been a lot of product traded over the past week,” one large export trader with heavy exposure to the US said this morning.
“Despite the fact that many US importers are in need of beef, there’s a feeling that whoever goes first sets a price precedent,” he said.
“Some of the bigger US importers have already increased their offer prices by the 10pc (representing the tariff amount), but some of that may be product they already have in the country, to compensate for the product they now have on the water on which they have to pay an extra 10pc.”
“But we are not hearing about a lot of new imported product being sold ye…
