CME Cattle Futures Decline Amid Expectations of Trump Administration's Beef Import Policy Shift

US Beef Imports Expected to Increase Amid Federal Policy Shift

Chicago, May 12 (Reuters) - The Chicago Mercantile Exchange (CME) live cattle and feeder cattle futures fell on Tuesday as expectations grew that the federal government would facilitate more beef imports into the United States. The potential increase in beef imports comes as President Donald Trump's administration is fine-tuning executive orders aimed at reducing domestic beef prices.

According to a White House official, the administration was considering executive actions to allow increased beef imports into the US market at lower tariff rates. This move would allow countries to temporarily ship unlimited volumes of beef into the US market. The American Farm Bureau Federation believes that beef supplies may expand in the short-term if such a policy is implemented. However, the federation also warned that the policy would weaken incentives for ranchers to rebuild domestic herds.

The policy shift has sparked concerns among ranchers, who are still recovering from years of losses. Zippy Duvall, Farm Bureau president, noted that any plans to increase beef imports would be extremely worrisome and could undermine the fragile recovery ranchers are experiencing. The CME June live cattle futures closed down 1.700 cents at 247.700 cents per pound, while August feeders slid 5.750 cents to 356.550 cents per pound.

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In the cash market, cattle traded at $260 per hundredweight in Kansas and Texas on Monday, up about $4 from the previous week. US beef prices soared to records this year due to strong consumer demand and the dwindling size of the nation's cattle herd after a persistent drought burned up grazing lands.

The CME's lean hog market also suffered, with June futures tumbling 1.800 cents to 98.425 cents per pound, setting the lowest price since December. The American Farm Bureau Federation warned that encouraging additional imports risks weakening incentives for ranchers to retain heifers and rebuild domestic cattle inventories over the long run.