Executive Summary
The American beef market faces a period of unprecedented and sustained price pressure. This creates a significant economic burden for consumers. This report analyzes the structural factors driving the crisis. It also evaluates a current proposal from the Trump administration to expand the tariff-rate quota (TRQ) for Argentine beef.
The central argument is that high U.S. beef prices result from two primary market failures. First, a historically small domestic cattle herd has created a fundamental supply shortage. Second, the market power of an oligopolistic packer industry amplifies price volatility. This industry captures a disproportionate share of the food dollar. A policy of inaction is not a viable option, as it would ask consumers to endure record prices for the years required for domestic herd rebuilding.
The administration’s proposal is not a sweeping free-trade measure. It is a targeted, surgical intervention. It is designed to act as a pressure-relief valve on the domestic market. The policy expands the volume of beef that can be imported from Argentina under a lower tariff. This aims to introduce marginal supply and cool retail prices in the near term.
This report documents the severe price inflation and analyzes the supply-side constraints, which are rooted in multi-year droughts and high input costs. It also provides a detailed profile of the four dominant beef packers: Tyson Foods, JBS USA, Cargill Meat Solutions, and National Beef Packing Company. Their market concentration forms a critical bottleneck in the supply chain.
Beyond immediate domestic economic benefits, this policy offers a significant geopolitical dividend. The policy is a crucial pillar of a broader U.S. strategy. It supports the pro-American, reformist government of President Javier Milei in Argentina. This occurs during a time of escalating strategic competition. Bolstering a key hemispheric ally serves as a direct check on China’s expanding influence in the South Atlantic.
This report concludes that expanding Argentine beef access is a coherent and pragmatic strategy. It simultaneously addresses a domestic economic crisis, challenges a concentrated market structure, and advances critical U.S. national security interests.
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