Beef Prices Set to Surge This Summer as Trade Turmoil and Screwworm Outbreak Bite

Beef Prices and the North American Trade Grid

Beef prices are on the brink of another surge this grilling season, driven by a confluence of biological, climatic and policy shocks. A screwworm infestation that swept Mexican herds has crossed the border into Texas and New Mexico, slashing young cattle imports from Mexico by ↓ 80%. Simultaneously, prolonged drought has pushed U.S. herd sizes to levels unseen since the 1950s.

Compounding the supply squeeze, U.S. negotiators are wrestling with a potential rollback of the United States‑Mexico‑Canada Agreement (USMCA). President Donald Trump warned that Washington could abandon the pact, a move that would dismantle the tariff‑free framework that underpins a seamless beef market across the three nations. Without the agreement, each border could reimpose duties and nontariff barriers, inflating costs for processors and consumers alike.

Trade Integration: A Single Beef Market

Since NAFTA and its successor USMCA, cattle and meat products have moved freely: the United States imports roughly 2.1 million feeder and fed cattle annually from its neighbours, a flow valued at >$3 billion. In 2025, ground‑beef prices climbed by ↓ 20% since January, a direct reflection of tighter supplies.

“We can’t afford to lose demand,” said a Texas rancher, recalling the soybean crash after China halted purchases.

Mexico ranked as the third‑largest destination for U.S. beef exports in 2025, surpassing $1.3 billion, while Canada accounted for $874 million. Both countries also supply the United States with more than $5 billion of beef annually. A USMCA withdrawal would likely trigger reciprocal tariffs, stricter inspections and possible quotas, eroding the efficiency of a market that currently operates as a single North American system.

Analysts at the University of Tennessee caution that the combined effect of a dwindling herd, import bans and trade uncertainty could push retail beef prices beyond $7 per pound by late summer. For consumers already grappling with inflation, the outlook is bleak.

For further details see Reuters and Bloomberg.

Dispatch from: Victor Hale

Equities & Market Dynamics Analyst