Screwworms Spur New Cattle Migration

Is the Midwest Poised to Claim the Beef Industry?

Confirmed New World Screwworm (screwworm) cases in Texas are further reshaping the beef industry in North America. While the trajectory was set in motion in late 2024 when the first Mexico sightings were reported and the borders closed. The fact that it has now landed in the U.S. could me major long-term national economic shifts to the industry.

We know from previous dealings with the deadly pests that full eradication of screwworms could take a decade, which maybe too long for the economic network of businesses built on the cattle industry to wait for things to level out. Demand for beef is still high and if our border states, Arizona, New Mexico, and Texas, can’t afford to produce it, someone else will. These Southern states historically imported calves from Mexico to finish. The border has been closed in an attempt to contain screwworm, which has drastically altered the landscape in these states.

Will Mexico Absorb the Beef Economy? 

Both Mexico and Midwestern states present possible locations for beef production to expand. Long-term border closures contributed to the closing of Southwestern feedlots. Tight profit margins due to low inventory and high feed costs made it difficult for several feedlots to remain operational and screwworm was the final straw. Lubbock Feeders, a 70-year old feedlot regularly accommodating 40,000 head dropped to just 4,000 in the last year. Their decision to close up shop is telling of industry health, particularly along the border where quarantine lines have been drawn.

Without the option to ship live cattle into the U.S., Mexico has had little choice but to expand their own feedlots and processing plants. While the region has felt the strain of feeding and housing more cattle than they are used to, residents may not be complaining about the shift. Processed beef can be shipped across the border and the infrastructure development already underway in Mexico suggests the country is investing in U.S. certified slaughter houses in an effort to claim the market.

As of right now, Mexico may not be in a position to increase herd numbers, but the modernization of the beef industry within the country over the last two decades means they could be fairly well equipped to take on the role of beef producer in the coming years. We are already seeing a reversal of roles where Mexico now imports feed rather than exporting livestock. Exporting grains into a new market isn’t necessarily a bad thing for U.S. farmers, but is only lucrative if the U.S. can offer feedstocks at competitive price points, which we’ve struggled to do. 

Despite current tariff dynamics, the U.S. and Mexico have had a longstanding trade relationship thanks to beef production. The cows are eating the same grains, largely grown in Midwestern states, they’re just eating them in Mexico instead of Texas. As of right now, Mexico has no tariffs that would drive the cost of grains up and strain the flow of feedstocks necessary to support cattle numbers in Mexico.

Can Beef Production Stay in the Midwest?

The beef supply chain has worked in reverse for decades, following a natural migration pattern that knows no borders and boundaries. We’ve moved the cattle to where the best feed is. Which begs the question, can we just raise more cows in Midwestern and Northern states that are already producing feed for cattle? These states have some of the best soil in the country and ample grazing land to accommodate livestock. They are part of supply chain networks that make shipping and exporting efficient. And they have the added bonus of freezing temperatures capable of killing off flies and their larva.

To accomplish this the Midwest would have to overcome a few obstacles. Herd expansion is virtually impossible without the infrastructure to accommodate it. Building back a herd would require building back processing plants and feedlot capacity in states where these components of the beef industry have reduced operations or closed their doors in recent years. Just like Mexico, it would take strategic planning and significant investment to make the Midwest a bigger hub for beef production.

The Midwest would also face the same time constraints as anywhere else in the world. It takes three years to build back a cattle herd. Heifers born next spring won’t have their own calves until 2028 and that means we won’t see supply increase and grocery prices drop until at least 2030 whether the beef comes from Mexico or the Midwest. There is no quick fix. 

Can we afford to hand the industry over to Mexico or should we work to cultivate a new economic network here in the United States?

Economic Gains and Losses of Moving Beef Production to Mexico

The beef economy encompasses more than just the cows themselves. Texas alone stands to lose some $95 billion in economic output between ranch labor, trucking, processing and recreational ecosystems like hunting and fishing that often occur on the same land used to raise beef. 

If the cows go, so do the thousands of rural jobs that depend on the industry. The same story is unfolding in Arizona and New Mexico. Boxes of beef shipped north will keep us in steady supply of our beloved protein, but it doesn’t create new jobs for rural Americans. Can we keep that output in the U.S. and effectively safeguard our food supply and domestic jobs? 

Allowing Mexico to claim a larger share means we hand over billions of dollars in industry. And, with an ongoing screwworm problem American consumers may not get the benefit of cheaper priced beef if supply is still low and products must travel further. Yet, keeping cows in the Midwest doesn’t come with guarantees either. It’s unlikely that Northern states will be completely immune from screwworms which creates unknown risk factors for ranchers already operating in risky situations. There is a lot of work to be done on a ranch battling screwworm outbreaks. Can U.S. ranchers afford to pay employees to do the job or is it safer to further decrease operations?

The U.S. is making these decisions in the context of labor shortages, rising input costs, volatility in sectors like energy and fertilizer and a very consolidated beef industry. The best case scenario would be to see live cattle moving again between the U.S. and Mexico, and screwworm used as a catalyst for investing in regionally strong cattle production hubs. For now, livestock could be largely quarantined to their current location as we wait to see where the next screwworm case pops up in the U.S.