By Leah Douglas and Tom Polansek
WASHINGTON (Reuters) -President Donald Trump on Wednesday said U.S. cattle ranchers are benefiting from tariffs he has imposed on imports but must lower prices to encourage American consumers to buy their beef.
Trump earlier this week said the administration was considering importing Argentine beef as a means of lowering record-high consumer beef prices. The suggestion angered U.S. ranchers. U.S. farmers also recently lost out to Argentina on soybean sales to China.
"The Cattle Ranchers, who I love, don’t understand that the only reason they are doing so well, for the first time in decades, is because I put Tariffs on cattle coming into the United States, including a 50% Tariff on Brazil," Trump wrote in a post on Truth Social. "They also have to get their prices down, because the consumer is a very big factor in my thinking, also!"
Cattle and beef prices have surged after a years-long drought burned up grazing land and hiked feeding costs, forcing ranchers to slash their herds.
The U.S. Department of Agriculture has said that American ranchers must raise more cattle. Agriculture Secretary Brooke Rollins said on NewsNation on Tuesday that she would announce on Wednesday the agency's plan to "restore and revitalize the beef herd in America."
Eight Republican members of Congress sent a letter to Trump on Tuesday asking for more information on his plan to import beef.
"(We) urge your administration to ensure that any future decisions are made with full transparency, sound science, and a firm commitment to the U.S. cattle industry," said the letter, led by Representative Julie Fedorchak of North Dakota.
Economists have warned there is no quick fix to lowering U.S. cattle prices, because it takes two years to produce full-grown cattle.
"He needs to take a class in supply and demand," said Arlan Suderman, chief commodities economist for StoneX. "Cattle prices are high because demand is stronger than the supply. If you want to increase the supply of beef long term, you don't do it by lowering prices."
Tariffs imposed by Trump on imports of goods from Brazil this summer decreased the supply of beef coming into the U.S. from Brazil, prompting meat importers to pay higher prices to other suppliers, traders said.
"That certainly contributed to the higher cost of beef at the retail level," Suderman said. "It doesn't mean more profits to people feeding out cattle."
Feeder cattle futures set a record high last week.
On Wednesday, after Trump's post, U.S. feeder cattle futures dropped by their daily maximums. January futures were down the 9.25-cent limit at 361.025 cents per pound.
(Reporting by Doina Chiacu, Katharine Jackson and Leah Douglas in Washington and Tom Polansek in Chicago; Editing by Doina Chiacu and Leslie Adler)
