US lean beef trimmings prices surge amid lower domestic production, strong demand

US prices for 95CL lean beef trim have climbed 9.7% in the last four months on limited domestic supplies due the slow pace of cow slaughter and strong demand.

Platts, a part of S&P Global Commodity Insights, assessed 95CL beef CIF US at $7,253/mt, or $3.29/lb, on March 6, compared with $6,614/mt, or $3/lb, on Oct. 7, 2024.

Cow slaughter down

The low pace of cow slaughtering is due to "producers opting to use cows to keep herds stable and potentially building at a higher rate than utilizing heifers," said Caleb Hurst, market analyst for S&P Global Commodity Insights. "There is a strong argument to be made that cow slaughter trends confirm the herd has made supply low."

Slaughtered cows are the main sources of lean trims, and 95,000 head were slaughtered in the week ended Feb. 22, the US Department of Agriculture said March 6 in its last Cattle Weekly Slaughter report. This is down 6.9% on the week, down 8.6% from the previous six-week average, down 21.9% and 26.6% from the same weeks in 2024 and 2023, respectively.

This was the lowest February cow slaughter on record since 2006, when bovine spongiform encephalopathy affected the market. This decline will lower the US lean beef production forecast and increase the domestic value of lean trimmings going into the summer, according to analysts at Commodity Insights.

Beef imports up

Constrained domestic supplies and strong demand have supported import volumes.

US frozen beef imports during January were at 160,898 mt, the USDA said on its Global Agricultural Trade System Online data March 6. USDA used official trade data from the US Census Bureau.

The main origins for US beef imports in January were Australia with 43,310 mt, followed by Canada with 29,348 mt, Brazil with 24,845 mt, Mexico with 20,089 mt and New Zealand with 19,468 mt.

The January 2025 beef import volume was up 3.6% from the previous month and 11.6% from January 2024.

The US beef import volume for January 2025 from Australia was up 34.7% from January 2024, while imports from Canada were down 7.6%, Brazil down 17.1%,and New Zealand down 7.6%. Imports from Mexico increased by 11.3%.

Full-year 2024 beef imports were at 1.59 billion mt, up 25.8% from 2023. The main origin for US beef imports in 2024 was Oceania with 558,479 mt (355,159 mt from Australia and 173,702 mt from New Zealand), followed by Canada with 351,990 mt, Brazil with 234,353 mt, and then Mexico with 221,848 mt.

Tariff uncertainty

Despite the higher trend in lean beef prices amid lower domestic production and higher imports, the market was thin during the week, without many new trades for new shipments due to tariff uncertainty, sources said.

Most lean beef market participants expect higher prices due to a possible reduction in imports of cattle and beef to the US from Canada and Mexico because of potential tariffs. However, possible retaliation affecting US beef exports could pressure domestic beef prices, including lean beef trimmings. As a result, most traders prefer to wait for a clearer definition of the import tariffs and a better understanding of their potential impact on lean beef trimmings.