Trade on Hold: USDA Suspends Mexican Cattle Imports Amid Screwworm Concerns

Trade on Hold: USDA Suspends Mexican Cattle Imports Amid Screwworm Concerns

On July 3, the USDA issued a suspension notice halting cattle imports from several regions in Mexico. The order came after confirmed cases of the New World screwworm, a parasitic pest known for infesting open wounds in livestock. The move, led by the Animal and Plant Health Inspection Service (APHIS), targeted specific outbreak zones and signaled a firm biosecurity posture from U.S. regulators.

Screwworm isn’t a minor nuisance. It’s a high-risk pest that causes rapid tissue damage in animals and spreads through untreated lesions. Once established, it’s expensive to contain. The U.S. eradicated it decades ago using sterile fly release programs across large border zones. Those efforts worked, but they were costly. No one’s interested in repeating them. That urgency explains the fast response.

Trade numbers put this in perspective. In 2024, the U.S. imported over 1.1 million head of cattle from Mexico. Most of those were lightweight feeders shipped to yards in Texas, Arizona, and New Mexico. These animals are a known quantity in the southern Plains, used to fill pens, balance weights, and help feeders hit optimal marketing windows. They aren’t filler. They’re a foundational part of the supply strategy for many feedlots operating on thin margins and tight schedules.

The suspension interrupts all of that. Livestock that would’ve crossed the border this week is either being held or rerouted. Truckers are waiting. Schedules are off. In some yards, buyers are already reaching out to domestic suppliers, trying to backfill with calves from local auction markets. That scramble creates a ripple. Prices shift. Forward contracts get renegotiated or delayed.

At several sale barns in the Texas Panhandle and southern New Mexico, calf prices nudged upward in the first days after the announcement. The movement wasn’t dramatic, but it reflected real pressure. Buyers from feedlots that usually bring in Mexican cattle were bidding more aggressively. Some operators even pulled calves they’d planned to hold another week, hoping to catch the premium while it was there.

No one knows yet how long the suspension will last. That depends on how quickly Mexican authorities contain the outbreak and how confident USDA inspectors feel about the controls in place. If the pest stays confined, things may ease by late summer. If not, the pause could drag into the fall marketing window, when many feeders aim to be at capacity heading into winter finishing.

Even if the biological threat is short-lived, the logistical and financial disruptions are already happening. Feedyards work on rhythm. Break the cadence, change the flow of incoming cattle, delay placements, stretch timelines, and you start to lose efficiency. Plants feel it next. Fewer placements mean fewer finished cattle in the pipeline. That can slow kill rates, complicate labor schedules, and push costs higher.

This isn’t the first time animal health and trade policy have collided. But it’s a sharp reminder that in an integrated system, small shifts at the border don’t stay small for long.

Financial Implications and Industry Response to the Import Suspension

The immediate pressure of the USDA’s decision is landing hardest on feed yards near the southern border. Operators in Texas, New Mexico, and Arizona depend on predictable volumes of imported feeders to manage cost and inventory flow. Without those shipments, they’re forced to buy from thinner local supply pools or hold off entirely, hoping for a short delay rather than a long disruption.

The timing couldn’t be worse. Domestic herd sizes are already down due to earlier droughts and high input costs. That’s left many feedlots walking a fine line between capacity and constraint. With imports on hold, the balance gets harder. Some buyers are widening their radius, sending buyers into Colorado, Kansas, and Oklahoma to compete for light-weight calves. Others are adjusting feed rations or delaying placements to keep costs manageable.

Market effects are starting to stack. Auction prices for 500–600 lb calves have ticked up in affected regions, and while national averages haven’t moved sharply, local premiums are noticeable. Feedlot operators say the biggest risk isn’t price, it’s uncertainty. Without clear guidance on how long the halt will last, most are working week to week.

Beef processors are watching closely. Plants located near the border, especially those with long-standing contracts tied to imported cattle, are now adjusting schedules. Fewer placements mean fewer finished cattle six to eight months from now. That could lower throughput rates, affect staffing, or shift kill schedules into less efficient patterns. In some cases, processors may look farther north for inventory, but that carries freight costs and logistical headaches.

Producers upstream are adjusting, too. Ranchers who might have sold calves later this summer are reevaluating. Some are moving inventory early to capitalize on regional premiums. Others are extending pasture time and holding off, waiting to see how the market settles. In both cases, marketing plans are getting rewritten.

There’s also a secondary effect on feed demand. If feedlot placements slow, grain usage dips in the short term. Corn and soybean meal traders in the Southwest have already noted softer basis levels in a few areas tied to expected placement delays. It’s unlikely to move national grain markets, but the regional signal matters, especially for merchandisers managing supply out of West Texas or eastern New Mexico.

Policy voices are weighing in. Ag groups from both sides of the border have called for rapid containment and clear benchmarks for lifting the suspension. Several industry reps praised the USDA’s decisiveness but cautioned against a prolonged pause without ongoing communication. Behind the scenes, the U.S. and Mexico are coordinating through existing screwworm control channels, including surveillance and sterile fly release programs. There’s precedent for quick recovery if the pest doesn’t spread.

Still, the episode is another entry in a longer list of trade-linked shocks. Disease outbreaks, pest control actions, regulatory changes, they all hit faster and harder in a system built on lean inventories and constant motion. For feeders, processors, and traders, the lesson is clear: flexibility isn’t a preference. It’s a requirement.

As monitoring continues, most in the industry are keeping plans fluid. Nobody’s predicting a return to normal next week. But they’re hoping that clear updates, and steady containment, can keep a sharp disruption from becoming a drawn-out drag.