OMAHA (DTN) -- The leadership of four major livestock and agricultural groups on Wednesday wrote President Donald Trump, urging him to "reverse course" on his plan to allow up to 300,000 metric tons of foreign beef into the country without paying the normal out-of-quota tariff.

The presidents of the American Farm Bureau Federation, Livestock Marketing Association, National Cattlemen's Beef Association and U.S. Cattlemen's Association co-signed a letter to Trump challenging the value of flooding the market with discounted foreign beef, and making the case that it is not the way to rebuild the domestic cattle herd.

"The stated purpose of driving down beef prices and the commitment to sell it at a price that undercuts domestic supply send a disheartening message to farmers and ranchers across the country," the agricultural leaders wrote Trump. They added, "This announcement has already driven cattle markets sharply lower and undermines producers at a critical time of year when they are marketing cattle and making herd-rebuilding decisions."

MARKET EFFECTS

As of Wednesday's close, the spot October live cattle contract closed at $210.77 per cwt, which is the lowest position the market has traded in more than eight months. The September feeder cattle contract closed at $319 per cwt, which is the lowest price the market has seen since last December.

The industry also saw the first heads of feeder and fed cattle from Mexico cross into the U.S. this week, although the Mexican border opening is expected to be slowly phased in.

DTN Livestock Market Analyst ShayLe Stewart noted the cattle complex has been chalked full of risk and volatility over the past month. Along with the imports, Tyson Foods also announced plans to close two plants and sell another.

"It would appear that the decision made by the President was made as an olive-branch attempt to consumers ahead of the midterm elections, as inflation is on the forefront of everyone's mind," Stewart said. "But the addition of 300,000 metric tons of beef would only add about 2% to total domestic beef supplies -- and that's only if retailers elect to sell the product immediately. Not to mention, if the long-term goal for the industry is to rebuild its domestic herd, adding additional pressure to the cattle complex during a time in which the market expects to see an increase in feeder cattle sales is negligent. If producers are going to elect to rebuild their herds -- they need to see profitability, stability in the markets and demand from all sides of the sector."

POLITICAL CHALLENGES

Feeder cattle contracts on the CME, such as the October contract, have dipped about $10 per CWT since Trump's announcement last Friday. The industry, though, also saw the first heads of feeder and fed cattle from Mexico cross into the U.S. this week, although the Mexican border opening is expected to be slowly phased in.

The president announced last week his plan to suspend duties on 300,000 metric tons of beef -- about 661.4 million pounds. Trump said companies have agreed to sell the beef at a 25% discount that would be passed on to consumers.

Trump is caught between a constituency that has been loyal to him -- farmers and ranchers -- and American consumers who are concerned about inflation heading into the November midterms. Politico noted Tuesday that White House officials have internal polling showing that grocery prices rank among Americans' top concerns.

In their letter, leaders of the livestock groups said beef prices are in line with other consumer prices and reflect the inflated costs of raising cattle, grain and forage. Farmers and ranchers are also finally earning enough profits from cattle to invest in their operations after dealing with drought, high input costs, disruptions at processing plants and other challenges that have reduced cattle inventories, the letter to Trump stated.

"This announcement will discourage investments in the U.S. cow herd and undo the progress producers have made," the ag leaders stated. They added, "We are deeply concerned that this import strategy sacrifices long-term food security for a short-term solution. Americans deserve safe and wholesome beef free from any market-distorting actions."

The agricultural leaders said cattle producers are asking Trump for a "fair and competitive market, honest price signals and policies that put U.S. farmers, ranchers and consumers first." Without spelling out specific suggestions, the leaders stated they are ready to work on policies "that strengthen, rather than weaken, America's capacity to feed itself."

Other groups such as R-CALF USA, along with cattle associations from nine states, sent a similar letter to Trump on Tuesday.

SMALLER HERD, MORE BEEF

The dispute comes as the cattle industry wrestles with two seemingly contradictory trends: The U.S. cattle herd is historically small, but producers are getting more beef from each animal and consumers continue buying beef despite record prices.

The U.S. has the smallest cattle herd in 75 years, but dressed weights for fed cattle also have grown an average of 44 pounds over the past six years as well.

Speaking Friday at a Kansas State University agricultural economics conference, Glynn Tonsor, a professor who specializes in livestock markets, said the decline in beef cows has been a long-term trend that doesn't appear to be turning around. He noted the number of cows has been in a steady decline since the 1960s. Going back to 1965, the number of cows has declined an average of 167,000 head a year. Since 1996, the decline has averaged about 198,000 cows a year. At the same time, Tonsor said fewer cattle don't necessarily translate into less beef.

"It's not new that we have fewer beef cows," he said, adding, "This industry is simply getting more efficient with every cow in the system, and when I say more efficient, I mean getting more beef pounds on the plate to somebody in the world per cow."

Tonsor also noted consumer demand has leveled off, but hasn't declined even though beef prices are increasing faster than the rate of inflation. Fed cattle prices from 2020-2025 grew 107%, while the average retail price for beef rose nearly 39%, yet per capita consumption and demand continue to rise and hold steady.

"Consumer demand strength is the No. 1 driver of higher cattle prices," Tonsor said.

BEEF PRICES AND IMPORTS

The St. Louis Federal Reserve reported the average price for ground beef in a U.S. city was just under $6.89 a pound in July. That's a record price, as ground beef has been largely on an upward trajectory after dipping to $3.95 a pound in December 2020 during the pandemic.

Americans consume an estimated 9.7 billion pounds of ground beef annually. For perspective, the 661.4 million pounds of beef covered by Trump's plan would equal nearly 7% of annual ground-beef supplies if it all went into that market. As cattle producers already know, meatpackers import a significant amount of lean trim that is blended into ground beef to produce 80%, 85% and 90% lean mixes sold in stores.

The U.S. is also importing nearly twice as much beef as U.S. meatpackers are exporting this year.

Through June, the U.S. imported $9 billion in beef and veal products, according to USDA. That's up 28% from the first six months of 2025, which was a record year in beef imports at $13.7 billion.

In contrast, U.S. beef exports for the first six months of 2026 come in at $4.7 billion in value, according to the U.S. Meat Export Federation. That's down 4% from the same period a year ago.

Also see:

"Trump Proposes Lifting Tariff Rate Quota on 300,000 Metric Tons of Beef Imports," https://www.dtnpf.com/…

"Breaking Down How Producers Use LRP to Protect Feeder Cattle Prices," https://www.dtnpf.com/…

Also listen to a podcast on the beef labeling debate: https://www.buzzsprout.com/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on social platform X @ChrisClaytonDTN

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