Tariff uncertainty hit the Mercosur steer market

The threat by US President Donald Trump to impose a 50% tariff on imports of Brazilian products hit the average slaughter cattle price hard in Mercosur countries. Although there is time to negotiate until August 1 — when the additional rate would come into effect, raising the tariff on Brazilian beef to 86.4% — the market has already felt the impact, as has the exchange rate of the Brazilian currency.

As a result, the WBR Mercosur Steer Index fell by 5 cents in the week to US$ 3.93 per kilo carcass weight, the lowest level in five weeks.

The real depreciated 2% against the US dollar, while the finished male price (boi gordo) dropped 1.2% in local currency. Therefore, the boi gordo reference price in dollars fell 11 cents on the week to US$ 3.52 per kilo carcass weight, with 30-day payment and exempt from the Funrural tax.

In Argentina, the increase in the export steer price in pesos more than offset the weakness of the exchange rate. The export steer price rose 1 cent to US$ 4.51 per kilo carcass weight, a reference that includes the 6.75% export tax on steer beef.

In Paraguay, slaughter cattle prices rose sharply for the second consecutive week. The finished male price increased by 20 cents to US$ 3.95 per kilo carcass weight.

In Uruguay, the supply of special steers is minimal, and their price remained stable during the week at around US$ 5.12 per kilo.