Australian beef targeted by US' 10pc tariff

Market: Agriculture
03/04/25

Imports of Australian goods will be tariffed at a general rate of 10pc, US president Donald Trump announced on 2 April, as he signalled his displeasure regarding Australia's biosecurity regulations on agricultural product imports.

Australian imports will be levied with a broad 10pc tariff, the minimum under the Trump administration's regime designed to boost domestic production and raise revenue. Trump cited Australia's biosecurity-based restrictions on US beef imports as a reason for his tariff imposition.

"Australia bans American beef and yet we imported $3bn of Australian beef from them last year alone, they won't take any of our beef," Trump said at the White House on 2 April, "They don't want it because they don't want it to affect their farmers."

Australia's main export of beef to the US is lean trim, rather than cuts, with total beef exports of 395,000t in 2024, or 29pc of the total 1.34mn t shipped. Australia's other significant trade partners include China, South Korea, Japan and the Middle East.

The decision comes as US cattle ranchers remain drought-affected, with nearly 40pc of the nation classed as suffering from moderate-to-exceptional drought at the end of January 2025, the US' National Drought Mitigation Centre said. The female-to-male slaughter ratio has reached its highest average in 25 years in the past six years, with the country recording its smallest January herd numbers since 1951 in 2025.

The world's largest cattle producers Brazil and Australia exported record quantities of beef in 2024, while the US will export 13pc less and import 3pc more beef in 2025 on the back of its declining herd, according to the US Department of Agriculture (USDA). This is despite a recent update from the USDA indicating that heavier-than-expected carcase weights will increase domestic output by 120mn lbs from the previous forecast.

Tariff impacts on Australian beef values is expected to be limited based on the 10pc figure because of high US domestic beef prices, low storage levels and declining numbers of US cattle on feed. Feedlot placements were down by 18pc on the year on 1 March, USDA statistics show.

Import mix

Major competitor Brazil was also hit with a 10pc general tariff on goods. The country already incurs 26.4pc above-quota tariff rates for exports to the US, which were applied from 17 January 2025. But Australia receives 448,000 t/yr tariff-free access under a free trade agreement signed with the US in 2005.

Beef imports from Mexico and Canada will be exempt from the 10pc reciprocal tariffs, along with other products under the US-Mexico-Canada Agreement.

Canada and Mexico accounted for 22pc and 13pc of US beef imports respectively in 2024 according to USDA data, and the countries could gain a larger share of the US beef market going forward.

New Zealand's beef exports to the US totalled 183,000t in 2024, with the nation's red meat exporters still expecting high demand from the US despite potential disruption to trade flows because of the 10pc tariff.

By Tom Major and Grace Dudley

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