Cattle markets are reacting nervously to rumors and speculation that the Mexican border may reopen at any time to cattle imports.
Derrell Peel, livestock marketing specialist at Oklahoma State University, in a letter called Cow-Calf Corner, said, many questions swirl about when the border might open, how many cattle are backlogged in Mexico and how fast cattle might cross into the US.
SOME NUMBERS ARE HELPFUL
From 2004 through 2023, US imports of Mexican cattle averaged 1.17 million head a year, ranging from 0.703 to 1.47 million, Peel said. On average, Mexican cattle imports equal 3.3% of the US calf crop. Mexican cattle imports include steers and spayed heifers, with heifers accounting for an average of 15.6% of the imports.
Severe drought in Mexico, especially in 2023 and 2024, significantly affected cattle exports to the US, he said. In 2023, 1.25 million head were imported, including 28.4% spayed heifers.
In 2024, 1.25 million head of Mexican cattle were imported prior to the border closure in late November, Peel said. Given the typical seasonal pattern of imports, 2024 Mexican cattle imports were on pace to set a record of 1.45 to 2.0 million head. Imports prior to the border closure included 37.1% spayed heifers, a record level.
Steers in the import mix both years were below average levels, Peel said. Mexican cattle exports in 2023 and 2024 were most likely not sustainable and indicated cattle liquidation.
2025, A LIKELY SCENARIO
What would have happened in 2025 if the border had not been closed? he asked. The events of the previous two years likely meant that fewer cattle would have been available for export. It appears that 2025 cattle exports to the US may have totaled 0.95 to 1.0 million head. A total of 229,055 head did cross in the brief periods that border was open earlier in the year.
The big question is how many potential cattle exports have been reabsorbed into the domestic Mexican market, Peel said. There are indications Mexican feedlots have been placing Mexican cattle (substantially devalued relative to the US market) in lieu of Central American cattle that typically backfill the Mexican cattle supply.
Improved drought conditions in Mexico allow more flexibility for producers to hold cattle, Peel said. For example, the October 12-month moving average of rainfall in Chihuahua was at the highest level since July 2023. However, with little prospect of the border opening and only rumors, many Mexican cattle may have been marketed back into the domestic market.
There are no prospects for spayed heifer imports into the US, currently, he said. The limited time frame for spayed heifers to be exported combined with the uncertainty of the border makes it risky and unlikely that heifers would be scheduled for export.
There also may be more heifer retention now in northern Mexico, Peel said. On net, it seems likely that perhaps 200,000 to 400,000 Mexican cattle may currently be available for export.
When the border opens it will take time for cattle exports to begin and they likely will start slowly, he said. Border facilities have to be restaffed, and producers have to prepare cattle and paperwork for export.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $218.97 per cwt to $227.15, compared with last week’s range of $218.52 to $225.00 per cwt. FOB dressed steers and heifers went for $339.66 per cwt to $354.27, compared with $331.92 to $349.49.
The USDA choice cutout Thursday was down $1.25 per cwt at $358.11 while select was down $1.42 at $343.46. The choice/select spread widened to $14.65 from $14.48 with 92 loads of fabricated product and 59 loads of trimmings and grinds sold into the spot market.
The USDA-listed the weighted average wholesale price for fresh 90% lean beef as $394.12 per cwt, and 50% beef was $145.33.
The USDA said basis bids for corn from feeders in the Southern Plains were steady to down $0.05 at $0.90 to $1.10 a bushel over the Mar corn contract, which settled at $4.46 1/2, up $0.02 1/4.
No live cattle contracts were tendered for delivery Thursday.
The CME Feeder Cattle Index for the seven days ended Wednesday was $345.47 per cwt, up $1.44. This compares with Thursday’s Jan contract settlement of $343.40, up $5.02.