Ranchers hope Trump tariffs boost demand for cattle but some fear market uncertainty

OMAHA, Neb. -- Rancher Brett Kenzy hopes President Donald Trump's tariffs will make imported beef expensive enough that Americans will turn to cattle raised at home for all their hamburgers and steaks.

That might raise prices enough to give Kenzy and others the incentive they need to expand their herds for the first time in decades. But doing that would take at least two years, and it's not clear if Trump's tariffs on most of the world besides China are high enough to make that worth the investment.

“If we can just fix a few key things, I think that we can reinvigorate rural America,” said the South Dakota rancher. “Just get these imports under control, get them to a level that we can understand and plan on, and then let us fill the void. And I think that the American rancher can do that.”

Trump has enjoyed overwhelming support in rural parts of the country in his three campaigns for president. Still, the uncertainty created by the trade war he instigated has given some ranchers pause as they've watched cattle prices drop after the tariffs were announced.

“I just don’t like manipulated markets because somebody is going to artificially win and somebody is going to artificially lose,” said Bryant Kagay, who raises and feeds cattle as well as growing crops on his farm in northwest Missouri. “And how do I know it’s not going to be me?”

Ranchers hope the tariffs might create an incentive for them to raise more cattle, and the National Cattlemen trade group is salivating at the idea of selling more cuts of meat overseas if the tariffs lead to new trade deals with countries that don't buy much U.S. beef.

That's a big if — Trump has said dozens of countries have reached out to negotiate new trade deals, but no agreements have been reached.

About the only thing clear so far is that American ranchers will likely lose one of their biggest markets as a result of the 125% tariffs imposed by China in response to Trump. They sold $1.6 billion worth of beef there last year, and since many ranchers also raise crops, they are reeling about the prospect of losing China as a market for those, too.

Most beef exports to China are already on hold because the certificates from that country that meat plants need weren't renewed at most beef plants in the United States after they expired in March. So the U.S. Meat Export Federation said few American beef plants are even eligible to ship to China right now.

Kenzy hopes Trump's tariffs represent a lasting change in U.S. trade policy. So far the tariffs have been changing so much since they were announced that ranchers can’t count on them yet.

“If this is just a short-term negotiating tactic — Tarzan beating his chest — then I would say that that would be an epic failure because that will not result in reshoring industry,” Kenzy said.

The problem, as Kenzy and other members of the Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America see it, is that the more than 4 billion pounds of beef that's imported every year — along with cattle brought in from other countries to be slaughtered here — keeps cattle prices lower.

Much of what is imported is lean beef trimmings that meatpackers mix with fattier beef produced here in the United States to produce the varieties of ground beef that domestic consumers want. Even though Trump placed most of his proposed tariffs on hold, the across-the-board 10% tariffs he imposed for 90 days will make imported beef more expensive, so consumers are likely to see the price of hamburger increase.

Even if ranchers decided to raise more cattle to help replace those imports, it would take at least two years to breed and raise them. That means meat processors will likely pay higher prices for that imported beef for at least that long. And the ongoing drought across most of the West will continue to make it difficult to raise more cattle.

Plus, if American ranchers want to produce more of that lean beef they might have to change the way they raise their animals because the entire system in this country is designed to produce fattier meat to get deliciously marbled and tender steaks that help ranchers make the most money. Kansas State University agricultural economist Glynn Tonsor said most of the lean beef America buys comes from Australia and New Zealand where cattle are fed grass — not grain — their entire lives, and that's an entirely different system.

The number of cattle being raised across the country has been shrinking for decades to reach the current historic lows of around 28 million, but Texas A&M livestock economist David Anderson said even though that's less than two-thirds of the number of cattle there were in 1975, more beef — some 26.7 billion pounds — was actually produced last year. That's because the American beef industry has become so good at feeding cattle and breeding larger animals that now every head of cattle produces more meat. Anderson said that means there's less incentive to expand the herd.

Casey Maher, owner of the Maher Angus Ranch in Morristown, S.D., said he hopes Trump’s tariffs will level the playing field for American beef producers.

“We’re optimistic and we’re going to stay the course,” said Maher, a third-generation rancher. “We’ve gone through tough times, and if it’s for the greater good, I think ranchers are all in.”

Not all of them, though. Kagay, the Missouri farmer, said uncertainty causes problems of its own.

“I’m not real confident about these tariffs,” he said. “Will they stick around? Will they not stick around? Can I count on them? What exactly is going to happen? You know, nobody knows. So it makes it hard for me to plan my business. I just don’t like it.”

That uncertainty could extend well beyond farming and ranching if it creates new fears about the economy as a whole. If consumers buy less beef because they are worried about their grocery budgets, it won't matter how much beef is imported.

“You’re less likely to pay up for a ribeye steak if you’re worried about losing your job,” Tonsor said.

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Associated Press writer Sarah Raza contributed to this report from Sioux Falls, South Dakota.