US quota hike offers outlet for Brazilian beef as China, EU demand weakens

Brazil's beef exporters may be able to offset weaker shipments to China and the EU in marketing year 2026 (January-December), as market participants expect the South American nation to benefit from a temporary expansion of the US tariff-free import quota.

The US increased its tariff-free quota for lean beef trimmings by 300,000 metric tons for September-November to ease domestic beef prices amid historically tight cattle supplies.

"For Brazil, the outlook is positive. With the new US import window and the temporary halt in trade with China, there is room for Brazilian shipments to increase by 40%-50% by year-end," S&P Global Energy CERA said in a report.

Brazil, the world's largest beef exporter, exhausted its annual US tariff-rate quota during the first week of 2026, after which shipments became subject to a 26.4% import tariff.

"Brazilian beef exporters have been increasing their exports to the US since the beginning of 2026 despite the higher import duty," a trader with a US-based multinational food trading company said.

Brazil exported 240,975 mt of beef to the US during January-August, up 37.2% year over year, according to data from Brazil's Secretariat of Foreign Trade (Secex). CERA forecasts Brazil's beef exports to the US at 401,301 mt in 2026, compared with 271,710 mt in 2025.

Overall, Brazil exported 1.91 million mt of beef during January-July, up 4.7% from the same period a year earlier, Secex data showed.

Market participants said Brazilian exporters are eager to maximize shipments during the temporary duty-free window.

"Offer prices for Brazil-origin beef into the US have declined since the start of September as exporters seek to increase shipments following the quota expansion," a US-based beef trader said.

China, EU shipments under pressure

Brazil's beef exports to China are expected to decline in 2026 after Beijing introduced annual import quotas, while shipments to the EU face disruption following the bloc's suspension of imports of Brazil-origin beef over concerns related to compliance with antimicrobial-use requirements.

Brazilian exporters have been slowing shipments to China since July as they approach China's 2026 import quota. China's General Administration of Customs reported in July that Brazil had already utilized 91.5% of its annual allocation.

Brazil exported 872,757 mt of beef to China so far in 2026, down 7.9% year over year, according to Secex data.

"Packers have slowed the pace of shipments to China because of concerns that exports could exceed the annual quota," a Brazil-based exporter said.

China announced, on Dec. 31, 2025, that it would implement country-specific quotas on beef imports and apply an additional 55% tariff on volumes exceeding quota levels between 2026 and 2028.

China set Brazil's beef import quota at 1.1 million mt for 2026, rising to 1.13 million mt in 2027 and 1.15 million mt in 2028, according to the country's commerce ministry.

The EU, meanwhile, remained a stronger destination for Brazilian beef until the recent import restrictions.

Brazil exported 72,947 mt of beef to the EU during January-August, up 26.4% year over year, Secex data showed.

The EU removed Brazil from its list of approved exporters of animals and animal products effective Sept. 3, citing non-compliance with antimicrobial-use regulations.

"While the EU accounts for a relatively small share of Brazil's beef exports, weaker demand from China, coupled with the loss of the European market, could weigh on Brazilian export prices," a trader with a Brazil-based beef trading firm said.

Output, exports forecast to decline

Brazil's beef production is expected to decline in MY 2026 as the country's cattle sector continues a phase of herd rebuilding, according to CERA.

CERA projects Brazil's beef output at 12.12 million mt in MY 2026, down 3.9% year over year. Production is forecast to fall a further 4.1% in MY 2027 to 11.62 million mt.

Market participants attributed the decline primarily to lower cattle slaughter rates.

According to CERA, cattle slaughter is expected to total 45 million head in MY 2026, down 7.2% year over year. Slaughter is forecast to fall another 8.4% in MY 2027 to 41.2 million head.

Brazil's beef exports are projected at 3.86 million mt in MY 2026, down 11.9% from the previous year, CERA said. Exports are forecast to decline a further 8.4% year over year in MY 2027 to 3.54 million mt.

Platts, part of S&P Global Energy, assessed the Brazil beef marker at $5,920/mt Sept. 8, up 3.7% year over year.