Recent price declines in cattle markets have prompted questions concerning the role cattle and beef imports might be playing, if any, in the declines. This week’s Tidbits will tackle cattle imports.
Figure 3 plots total cattle imports into the U.S. since 2000 along with imports from Mexico and Canada. Rarely will the U.S. import cattle from other countries. Cattle imports from Mexico tend to be lighter-weight cattle intended for feedlots while imports from Canada are primarily slaughter-ready cattle. Cattle imports hit a low in 2004, following the Bovine Spongiform Encephalopathy (BSE) incident in December 2003, totaling about 1.4 million head. Imports then rebounded and three years later returned to levels seen prior to the BSE case at around 2.5 million head. Since then, imports remained steady between 2.0-2.5 million head until 2015 when they again dipped below 2.0 million.
Cattle imports from both Canada and Mexico were higher last year compared to 2018 and once again exceeded 2 million head. Imports of slaughter-ready cattle from Canada numbered almost 523,000 head last year, up from 417,000 head compared to the year prior. This represented 1.6 percent of total U.S. cattle slaughter last year. The U.S. also exported nearly 275,000 head of cattle to Canada last year too, but the makeup of the cattle exported, whether breeding or feeding, is unclear. Feeder cattle imports from Mexico last year equaled 1.32 million head, 4 percent higher than 2018. The number of cattle imported from Mexico equaled about 4 percent of the total U.S. cattle slaughter. The U.S. also exported a small number of cattle to Mexico as well.
Through February, cattle imports in 2020 are 4.5 percent, or 15,000 head, less compared to last year. March import numbers will not be released until May 6. Exports of cattle to Canada and Mexico are up slightly compared to last year. So, all else being equal, it would appear cattle imports, being off a bit so far this year, would be having a slightly positive influence on prices. If anything, market events this year are unprecedented, and it’s difficult to ascertain influences without further research, but it does not appear live cattle trade with Canada and Mexico is markedly different relative to past years and is not having an undue influence on prices. Rather, it is the effects of the severe demand and supply disruptions resulting from COVID-19 that are the primary influencers on cattle prices this year.
Figure 3. U.S. Imports of Cattle, 2000-2019
Source: USDA Economic Research Service