The authorization of a 300,000-ton duty-free beef quota is unlikely to have a noticeable impact on prices paid by US consumers, but it could undermine market expectations and producer revenue prospects in the coming months.
That was the view expressed by Nevil Speer, a US beef industry consultant with a PhD in Animal Sciences, in a column published by Beef Magazine. Speer estimated that the announced volume is equivalent to slightly less than two weeks of US beef production or approximately one and a half months of the country’s usual imports.
However, he noted that not all of the volume will represent additional supply, as some of it will displace imports that would otherwise have entered from other suppliers. In his view, the intervention is unlikely to provide any significant benefit to consumers, but will introduce uncertainty into the market, with negative consequences for cattle prices and producer revenues.
Speer also questioned whether beef inflation justified the government intervention. According to his calculations, the cumulative increase in per capita beef spending over the past five years accounted for less than 1% of the overall increase in personal spending on goods and services.
