Chicago, (Reuters) .- President Donald Trump’s plan to impose a 50% tariff on Brazil’s products will probably raise the prices of beef that is used in American hamburgers, merchants and analysts said, since manufacturers depend more and more on imports due to a decrease in local production.
The proposal is a hard blow for American meat companies, which also face a lower livestock supply due to the suspension of imports from Mexico because of the boreride worm of cattle, a carnivorous plague that is extending south of the border.
The tariff would drastically reduce the imports of Brazilian beef and force US companies to look for other supplies, while Trump expands the fronts of their global commercial war, according to analysts.
“If it is not modified, the importation of Brazilian beef to this country simply ceases,” said Bob Chudy, American business consultant who imports beef. “Not a pound will be economic to those levels.”
The prices of beef in the United States reached records this year and it is expected that production falls 2%, 26.4 million pounds, after farmers reduced the country’s flock to a minimum of more than seven decades.
A several -year drought has deteriorated pastures and has increased cattle.
US imports of beef from Brazil during the first five months of the year were far Duplicate from the same period of the previous year, to 175,063 metric tons, according to the most recent data of the US government.
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Brazilian meat is 21% of total US imports.
A 50% tariff As of August 1, it would raise the tariff rate on Brazilian beef to around 76% for the rest of the year, they said livestock analysts.
“Commerce is absolutely frozen today,” Chudy said about the proposal.
“We don’t know what to do as an importing community.” American consumers also face strong price increases in basic products such as coffee and orange juice for tariffs to Brazil.
American companies import lean beef from Brazil and other countries to mix it with local supplies to make hamburger meat. Until now, consumers have been generally willing to pay high prices for meat, but the tariff would be a new proof of their demand.
“This tariff will probably increase the price of beef, a basic food for many, just after Congress voted in favor of reducing food aid to the most vulnerable consumers,” said Thomas Gremillion, director of Food Policy of the United States Federation of Consumers.
According to Austin Schroeder, Brugler Marketing & Management raw material analyst, the tariff forces importers to pay more for Brazilian beef or supply other more expensive suppliers.
“Help to raise the price,” he added. Vacua meat importers can try to increase the purchases of Australia, Argentina, Paraguay and Uruguay after the Tax on Brazilian products enters into force, analysts said. “It is not going to come much Brazilian flesh here,” said Altin Kalo, chief economist of Steiner Consulting Group. “That is reality.”
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