Brazil tariffs are fixin’ to rise to 76% on 8/1. Brazil is the #2 exporter to the US.
Higher tariffs are already contributing to higher beef prices. Things are gonna get worse.
With domestic cattle numbers dropping, more and more will have to be imported to meet demand. This doesn’t bode well for beef eaters’ pocketbooks. Chewing the fat a little more - the large immigrant workforce that processes beef will surely take a hit, raising labor prices. Chewing more (damn this is gristly), FDA food inspectors are strapped, meaning lower quality, higher priced beef.
Macrofying it - We should expect similar outcomes for other imported commodities.
Hold on, people are losing their jobs in California because of the minimum wage increase. Now you are telling me beef is going higher. It is already high. But at least we can blame it on the increase of minimum wage.
The shift of demand to pork and poultry will cause higher prices there, too. They can respond to market changes faster but if demand goes up faster prices will rise.
I gave up factory farmed beef, pork and poultry on August 12, 2012. But I suppose even beans, local eggs and wild caught sardine prices will also be affected eventually.
True dat X 3. However, domestic ranchers like higher prices, as long as consumers are willing to pay them. Prices won’t likely come down until people start changing their eating habits.
It takes up to 5 years to rebuild a herd (significantly expand it - double+).
Cow/Calf pairs must be rationed for future development (hei₣ers) or to slaughter.
Since a significant portion of all calves are male, growing the herd takes away some, but not all production opportunities.
Since there are losses, sales, inferior specimens and other challenges, 5 years is given as the typical time from “buy” to “sale” with any major changes to sale rates.
All of the above assumes genetics, space and other input requirements are sufficient.
**We are currently building a Wagyu herd on the ranch, using AI s€men and the best hei₣er genetics.
Ever watch the end credits, read the names of the second and third tier actors, on an old show, like that, and wonder what ever happened to them? I saw some names I recognized in that one: Martin Milner, James Drury, William Schallert. Twilight Zone is a good one to see very young examples of Bill Shatner, Robert Redford, and several others. But that is only a tiny sample. So many people, whose acting career never really got traction.
In later years, Schallert recalled, with some affection, the way he was able to lay into Captain Kirk, a couple times,
I’ll bet the honchos at McDonald’s aren’t so casual about it. After potatoes, beef is probably their second largest component cost, and yes, they source a fair part of their beef from Brazil.
(Note/warning to McDonald’s (and related) investors….)
This is sort of like saying “If you don’t own a car and don’t plan to get a car, then car import tariffs don’t matter”. Not terribly helpful in forming a Macro investment outlook.
Then again, it does matter, because tariffs distort the market in both predictable and unpredictable ways. I’m not against tariffs, but I’m for them in a targeted way that makes sense, as in preserving a strategically vital industry or commodity or to correct unfair trade practices like dumping.
This wholesale “sales tax on everything” approach is absurd on its face, and the results will not be pretty - nor evenly spread across industry or society.
GDavenport, great to have someone knowledgable post on the topic, and so thanks!
Related, as almost anyone who knows cowboy lore knows, rice and beans and biscuits with a little greenery thrown in when you can find it makes for a far far better diet than most USAians now whiningly consume.
