In June, the White House announced plans to impose tariffs on all goods imported from Mexico if Mexican authorities did not start cracking down on illegal immigration. The tariffs, which would have started at 5% but could have reached as high as 25%, were set to take effect June 10, but on June 7, President Trump announced that Mexico agreed to step up on border security issues and that the tariffs would be dropped … for now. Until the U.S.-Mexico-Canada Agreement (USMCA) is ratified, retaliatory tariffs between all three North American countries still remain a risk.
Tariffs with Mexico would have a significant impact on U.S. beef if they became a reality. Such an example can be seen with the U.S.-Mexico relationship with pork.
Mexico is the largest volume importer of U.S. pork. Until late May, Mexico was imposing a 20% duty on U.S. pork, a retaliatory measure against the U.S. steel and aluminum tariffs from 2018. The re-established zero-duty on pork is a relief to the U.S. pork industry, since pork export values to Mexico dropped 30% year-over-year between the second half of 2018 and April of this year, according to statistics from the U.S. Meat Export Federation (USMEF).
Mexico didn’t include beef products in its retaliation against the 2018 U.S. steel and aluminum tariffs, but experts agree they could definitely be on the chopping block if the U.S. was to start another round of tariffs on goods imported from Mexico.
Mexico is currently the third-largest export market for U.S. beef products, so the potential damage to the U.S. beef market would be severe, especially for feedyards in the South and Southwest, where a hefty proportion of cattle are either imported from or exported to Mexico. U.S. exports of agricultural products to Mexico totaled $20 billion dollars in 2018. The U.S. imported $26 billion worth of agricultural products from Mexico in 2018.
According to the Livestock Marketing Information Center, the U.S. imported about 1.3 million feeder cattle from Mexico last year, the most since 2012. In a tariff war with Mexico, the U.S. has a lot to lose.
Vice versa, Mexico sends about 80% of its exports to the U.S. A tariff war would make a big dent in their economy as well. If the USMCA gets ratified, the tension over tariffs will go back down to zero. Literally. 
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Carrie Veselka
- Editor
- Progressive Cattleman
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