American tariff causes chain reaction in Brazilian meat

American surcharge drops prices, wages contracts and obliges refrigerators to redirect volumes for new strategic markets

The announcement of 50% of the United States about Brazilian products has brought direct impacts on the meat sector in the country. The measure, released by President Donald Trump on July 9, generated a chain reaction in the internal and international markets, overthrowing the prices of the Gordo cattle and wholesale beef. Although there is, in fact, there is no excess supply in the domestic market, the pressure of American importers – who drastically reduced the prices offered by Brazilian meat – has made refrigerators and ranchers adjust their sales strategies.

According to data from Agrifatto consulting firm, the price of wholesale beef married in Sao Paulo, corrected by IGP-DI, fell from $ 21.03 per kilo at the beginning of the month to $ 19.50 last Wednesday (24), accumulating a reduction of 5.01% since the announcement of the fare. Datagro Livestock’s Ox indicator also felt the impact: the arroba went from R $ 313.12 to R $ 295.18 in the same period, a drop of 4.16%.

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A source from an exporting company, which declined to be identified, revealed that a few days after Trump’s announcement, US buyers requested the suspension of meat production for the US due to the instability caused by the new rate. If the surcharge comes into force from August 1, contracts already signed must be canceled. However, even with this momentary loss, there is no forecast of immediate layoffs in the refrigerators. The strategy has been to look for new destinations for the cuts that would be sent to the United States.

“Egypt, for example, paid $ 4,850 per ton of bovine front and is now paying $ 4,500,” the source said, noting that prices are lower but still viable to keep part of the exported volume. The idea is not to let the domestic market be overwhelmed with products that have lost space abroad.

The trend, according to experts, is that the meat will continue to press in the coming months. Agrifatto director Lygia Pimentel says the short term will be wholesale prices. Already Thiago Carvalho, researcher of Cepea, points out that the scenario was already unfavorable for the sector, with the beginning of school holidays, increased default and greater supply of cattle from the so -called “first confinement turn”.

Even so, the market seems to be adapting. Supermarkets and attack networks recognize that there is room to redirect part of the meat that would be sent to the US, but believe this impact on prices will be limited. This is because refrigerators have been adjusting their export strategies since April, when the US has applied an additional 10% rate on Brazilian products, raising the total rate to about 36.4%.

Three major retail networks reported in recent conversations with executives from Friboi and Marfrig, that there are already in progress negotiations to send meat destined to the US to countries such as China, Indonesia, Egypt and Mexico. Even so, brands have not announced readjustments in price tables for the domestic market – at least for now.

“It is difficult to redistribute at once the volume that would go to the US. Even if it is a small slice for a company like Friboi, on the market as a whole, the impact is significant,” said the president of a large attacking network. He points out that refrigerators need to balance price and volume, which may end up resulting in part of the meat being directed to the domestic market.

From January to June, meat had already registered a slight 0.65% drop on IPCA/IBGE. With the new fare, this movement tends to accentuate in the coming months.

A second executive, CEO of a network that participated in meetings with the board of Friboi and Marfrig, said the expectation was to double the volume exported to the US this year. “They export a lot of the front of the ox, who becomes a hamburger. This type of cut is difficult to sell to other markets, so part will end up here in Brazil if the fare continues,” he said.

Sought by the report, Friboi and Marfrig did not speak on the subject. BRF/Marfrig sustainability director Paulo Pianez said at an event that the tariff does not directly affect the company’s operations in Brazil, but generates a “disorder” in trade relations and a “losing” scenario for everyone involved.

Despite the challenging scenario, the sector demonstrates resilience. The search for new markets and adaptation to the new reality indicate that although meat is cheaper now, the sector is far from collapsing. Still, price pressure should continue as long as volumes are relocated and the market is rebalanced without the United States.

Why do the United States need Brazilian meat? Understand

The commercial relationship between Brazil and the United States in the beef sector has undergone a radical transformation in recent years. What was once an almost irrelevant participation in American imports has become a strategic dependence. From January to May 2025, Brazil accounted for an impressive 26.6% of all the US imported beef, according to data from Datagro Livestock based on information from the US Department of Agriculture (USDA).

This rise is even more striking compared to 2020 numbers, when Brazilian participation in imports was only 0.5%. Today, national meat already represents 5.4% of all beef protein consumed internally in the US. But what is the cut that draws the most attention from Americans?

Beef Trimmings-remaining pieces of the boning process-are the main products sought by the US market. “This category is the basis of the famous Ground Beef, used in hamburgers, ground beef and processed foods. Without Brazil, the American market would face an important bottleneck,” explains João Figueiredo, Datagro analyst.

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Ground meat plays a key role in the American diet, representing about half of the per capita beef consumption in the country. However, local production faces serious limitations. The scarcity of lower quality beef females – which are the basis for the production of these cuts – directly compromises internal supply.

“The United States has experienced difficulties around production costs, very sharp over the last few years, with loss of margin of ranchers and problems with family succession, which has significantly damaged the flock,” recalls Fernando Iglesias, from Safras & Mercado.

According to him, although the United States has technical conditions to restore its flock and reduce the dependence on imports, this process is long and can only be completed at the end of this decade. Until then, the need to complement the domestic market with foreign meat remains.

The impacts of the tariff

With Brazilian meat occupying a strategic position in the American processed food production chain, the announcement of the new measures of President Donald Trump-which foresees an additional 50% tariff about products in Brazil-can cause unexpected consequences: a significant increase in prices for the US final consumer.

“The most affected sector will be processed foods, and the impact on the end consumer can be expressive, especially on ground beef prices and derivatives,” says Figueiredo da Datagro.

Theoretically, countries such as Australia, New Zealand, Argentina and Uruguay could replace Brazil in this supply. However, according to Iglesias, none of them have the ideal combination of scale, cost and competitiveness that Brazil offers. “In addition, when meeting American demand, they stop meeting other markets, increasing the range of Brazilian possibility. That is, there can be a rearrangement of this current of global trade,” explains the analyst of the Safras & Mercado.

Brazil maintains the cheapest bovine in the world when converted into dollars, which gives significant competitive advantage. In addition, logistics infrastructure and large -scale production capacity allow the country to meet bulky demands without compromising quality.

For Brazil, the impact of a possible retraction on exports to the US would be moderate. Currently, only 12.3% of beef exported by Brazil is destined for the United States. Numbers that, although representative, do not endanger the stability of the national sector.

Given this scenario, experts believe that Brazil can take the opportunity to strengthen its presence in other strategic markets. Countries such as China, Egypt, Philippines, Iran and Russia have already shown interest in increasing their imports of Brazilian meat, especially given the price reduction caused by the momentary exit from the United States.

“Brazil has more sales alternatives than the US has to buy,” summarizes Datagro analyst, noting that dependence is asymmetrical: while Americans urgently need Brazilian meat to maintain their prices affordable, Brazil can easily redirect its production to other destinations.

Despite the commercial tension, the Brazilian meat sector demonstrates resilience and adaptability. In the long run, this crisis can become an opportunity to further diversify the export portfolio and reduce vulnerability to political decisions from other countries.

The challenge now is to maintain the balance between supply and demand, preventing the domestic market from being overloaded with products that have lost space abroad, while seeking to strengthen business partnerships with new strategic partners.

With information from Globo Rural*