Australia’s beef industry is navigating changing trade conditions in the United States, where lower tariffs for competing countries could weaken Australia's pricing edge. Nonetheless, strong demand from the US continues to support high export volumes, even as differences in tariffs among suppliers begin to shrink.
Australia remains the largest beef exporter to the US, with nearly $1.6 billion in red meat shipped in the three months to September this year. The US government's recent tariff cuts on hundreds of imported food items, including beef, aim to ease domestic inflation. Previously, Australia had benefited from comparatively low tariffs, giving it an advantage over competitors like Brazil. However, with Brazil’s beef tariffs set to fall from 76% to around 40%, the market could become more level among major exporters.
The shift has been driven by consumer pressure in the US, where grocery prices have soared. Ground beef reached an average of $US6.32 per pound in August, while steak prices rose 11%. A historically low US cattle herd, impacted by drought and parasites, is unable to meet domestic demand, which has led to greater reliance on imports. Brazil had initially doubled its beef exports to the US, but those figures dropped by 41% after the original tariffs were implemented in July, prompting a need for policy changes.
Although reduced tariffs on Brazilian beef may narrow Australia's price advantage, overall conditions still favour Aussie exporters. Ongoing demand for high-quality, safe and reliable red meat is helping Australia maintain export strength and price stability. Analysts believe Australian beef will continue to flow into the US in large volumes, as American supply is expected to take at least another year to recover.
In Australia, some beef producers view the lowered tariffs as a chance to diversify their offerings, including premium Angus meat pies and ready-to-eat dumplings, aimed at capturing more of the US market. While there are plans to allow more American beef into Australia after years of restrictions, the shortages in the US mean a significant supply increase is unlikely soon.
