Screwworm Border Closure Creates Economic Divide Between Mexican Beef Exporters and Texas Ranchers

On May 11, 2025, Agriculture Secretary Brooke Rollins suspended all live animal imports through southern border ports of entry [1]. The target: New World screwworm (Cochliomyia hominivorax), a parasitic fly whose larvae feed on living tissue and can kill livestock within days. One year later, the border remains closed, the pest has crossed into Texas, and the $100 billion U.S. beef industry is fracturing along the Rio Grande [2].

The closure has produced a stark economic asymmetry. Mexican beef exports to the United States surged 23% in the first four months of 2026 [3]. Meanwhile, a 70-year-old Texas feedlot is on the brink of shutting down because the cattle it once imported from Mexico are no longer coming [3]. The question facing policymakers is whether a biosecurity measure designed to protect American livestock has inadvertently accelerated a permanent restructuring of North American beef production.

The Pipeline That Stopped

The United States imported an average of 1.17 million head of cattle from Mexico annually over the past two decades, with a high of 1.47 million in 2012 [4]. These are overwhelmingly feeder cattle — young animals shipped north to be fattened in U.S. feedlots before slaughter. In 2024, before the closure took full effect, imports reached 1.24 million head [4]. In 2026, that number is zero.

Source: USDA AMS / Oklahoma State University Extension

Data as of Jun 6, 2026CSV

The shutdown affects all southern border crossing points. Before the suspension, cattle entered primarily through ports in Douglas, Arizona and several Texas locations including Laredo, Presidio, and Eagle Pass [5]. A brief, phased reopening was attempted in July 2025 at Douglas, but new screwworm detections farther north in Mexico forced an immediate re-closure [6]. The border has remained sealed since.

In dollar terms, Mexico's live cattle exports to the U.S. were part of a broader beef trade worth approximately $2.3 billion in 2025 [3]. The suspension of live imports has not eliminated the trade — it has redirected it. Mexico is now exporting processed beef instead of live animals, a shift with profound implications for where value is captured in the supply chain.

The Parasite's March North

New World screwworm was eradicated from the United States in 1966 and from Mexico by 1991, through a decades-long campaign using the Sterile Insect Technique (SIT) — mass-releasing sterilized male flies to disrupt reproduction [7]. A biological barrier of sterile flies maintained in the Darien Gap between Panama and Colombia kept the pest contained for years. That barrier collapsed around 2023-2024, and the fly began migrating north through Central America and into southern Mexico [8].

By late 2025, screwworm had been detected in states as far north as Oaxaca and Veracruz, roughly 700 miles from the U.S. border [1]. By December 2025, a case was confirmed in Tamaulipas, just 197 miles south of the border [5]. As of June 2026, nearly 28,000 animals in Mexico have been infested [3].

Then, on June 3, 2026, USDA confirmed the first U.S. case in 60 years: a three-week-old calf in Zavala County, Texas, with larvae in its umbilical area [9]. A second case was confirmed two days later in a one-month-old calf 5.6 miles away [10]. Texas Governor Greg Abbott expanded a disaster declaration — originally issued in January 2026 — to cover additional counties [10]. USDA established a quarantine zone covering parts of Zavala and Uvalde counties, prohibiting movement of warm-blooded animals without authorization from the Texas Animal Health Commission [11].

The current eradication timeline is far faster than the original U.S. campaign. The 1950s-1990s effort took roughly four decades to push screwworm from the southeastern United States through Mexico and into Panama [7]. Today, USDA is deploying 2 million sterile flies twice weekly by air over the Texas detection zone, plus 4 million per week via ground release chambers [9]. A new sterile fly production facility under construction at Moore Air Force Base in Edinburg, Texas, will produce up to 300 million sterile flies per week once completed [12]. Combined with facilities in Mexico, total production capacity is expected to approach 500 million flies per week [12].

Texas: Empty Pens and Rising Prices

The closure's impact falls hardest on Texas, the nation's largest cattle-producing state with a $15 billion cattle industry [10]. The U.S. cattle herd stood at 86.7 million head in 2025 — the lowest level since 1951 and the sixth consecutive year of decline [8]. Mexican feeder cattle, while representing only about 4-5% of total U.S. supply, are concentrated in southwestern feedlots that depend on them [3].

Lubbock Feeders, a West Texas operation with capacity for 40,000 head, illustrates the crisis. Its cattle count has dropped to roughly 4,000 [3]. Manager and part-owner Kyle Williams stopped bringing in cattle months ago because U.S.-sourced animals cost so much that the feedlot was losing more than $200 per head [3]. Bobby Swift, the 57-year-old assistant manager, now finishes his daily cattle check in 22 minutes [3].

The counties most exposed are in the southwestern border region: Zavala, Uvalde, Kinney, Webb, and surrounding areas where ranching operations historically fed cattle into the cross-border pipeline [10]. County judges in Kinney, Webb, and Uvalde counties have issued emergency declarations [10].

Source: FRED / Federal Reserve

Data as of Apr 1, 2026CSV

The Producer Price Index for slaughter cattle reached 387.67 in April 2026, up 17.7% year-over-year [13]. Retail beef prices hit an all-time high of $8.50 per pound in April 2025, and ground beef prices have risen 53% since 2019 [8]. The Dallas Federal Reserve projects steer prices will rise an additional 7.7% in 2026 [14].

Source: USDA / Federal Reserve Bank of St. Louis

Data as of Jun 6, 2026CSV

Eddie Womack, a farmer in Tulia, Texas, captured the frustration of U.S. producers: the closure may be protecting against screwworm, but it is simultaneously accelerating a shift in beef production, jobs, and profits from Texas to Mexico [3].

Mexico's Pivot to Processed Beef

The closure created an unusual opportunity for Mexican beef producers. Unable to export live animals, they are instead slaughtering and processing cattle domestically and shipping boxed beef north.

In 2025, Mexican beef exports to the U.S. rose 10.6% to approximately $2.3 billion [3]. Mexico's main meat producers council reported a 23% surge in U.S.-bound exports in the first four months of 2026 and has set a goal of doubling shipments [3].

Coahuila, one of Mexico's main beef-exporting states, is expanding federally certified and USDA-certified slaughter and packing capacity with government support [3]. State officials have argued that ranchers who add value through domestic processing can earn profits equal to or greater than what they received for live calf exports [3].

Enrique García, a rancher in Coahuila, doubled his workforce to fatten cattle and process beef, reporting an income boost of 8-10% [3]. "In the end, we are going to get to the United States just the same, but now with meat," one Mexican industry representative told Reuters [3].

The benefits, however, are not evenly distributed. Expanding certified slaughter capacity requires capital investment in facilities that meet USDA standards — an expense that favors large, established operations over smallholder ranchers. Major meatpackers like Tyson Foods, JBS, and Cargill are positioned to source from Mexico's growing processed beef output [3]. Darin Parker, president of meat distributor PMI Foods, has been tracking the shift in sourcing patterns [3].

The structural question is whether Mexico's beef processing buildout will outlast the screwworm crisis. If Mexican producers lock in long-term supply contracts with U.S. buyers during the closure, the live cattle trade may not fully recover even after the border reopens.

The Cost Calculus: Protection vs. Disruption

USDA's economic case for the closure rests on the projected damage a screwworm outbreak would inflict. The Dallas Fed estimates that a 1972-scale infestation in the Southwest would cause more than $3 billion in losses; an extended outbreak on the scale of 1962-1980 could exceed $8 billion nationally [14]. A Texas A&M analysis projected $2.1 billion in cattle industry losses and $9 billion in damage to hunting and wildlife industries in Texas alone [15].

Against those figures, the federal government has committed approximately $850 million to screwworm eradication in FY2025, primarily for the Edinburg sterile fly facility ($750 million) [12]. Emergency funding from the Commodity Credit Corporation totaled $109.8 million in FY2023 and $165 million in FY2024 [16].

Source: USDA APHIS / Congressional Research Service

Data as of Jun 6, 2026CSV

The cost-benefit math appears to favor the closure — but that framing obscures who bears the costs. The $850 million is federal spending distributed across taxpayers. The losses from empty feedlots, reduced cattle purchases, and lost processing jobs are concentrated in specific Texas communities. No federal compensation or relief program has been established for affected feedlot operators, and public reporting has not identified organized lobbying for a specific relief package [3].

Who Pays for the Barrier?

The funding split between the U.S. and Mexico has become a point of tension. Historically, the U.S. has borne the majority of joint eradication costs — in Central American programs, the split was roughly 85% U.S. and 15% host country [17]. Secretary Rollins stated in 2025 that "all materials and operations are being funded entirely by the United States" [16]. She further alleged that Mexico's aviation authorities were imposing restrictions on USDA aircraft and customs officials were levying import duties on sterile fly shipments and aviation equipment [16].

Mexico has contributed to the effort through its National Service of Agro-Alimentary Health, Safety, and Quality (SENASICA), which partnered with APHIS to construct a sterile fly dispersal facility in Tuxtla Gutiérrez, Chiapas [12]. The facility in Metapa, Mexico, received $21 million from USDA to convert an existing fruit fly facility for screwworm production [12]. Mexico's financial contributions to these joint facilities have not been publicly itemized in comparable detail.

The asymmetry raises a pointed question: American ranchers are absorbing the economic pain of a border closure necessitated by a biosecurity failure that originated south of the border, while U.S. taxpayers fund the vast majority of the eradication effort. Mexican producers, meanwhile, are capturing new market share enabled by the same closure.

Precedents: When Borders Close, Markets Shift

History suggests that biosecurity closures can produce market realignments that persist long after the underlying threat is resolved.

The 2001 UK foot-and-mouth disease outbreak resulted in the culling of six million animals and £3.1 billion in losses to agriculture and the food chain [18]. All livestock markets were closed and exports were banned. Some UK producers never recovered their pre-outbreak market position as buyers diversified supply chains during the closure.

China's African swine fever crisis, which began in 2018, offers a more direct parallel. China lost an estimated 27.9 million metric tons of pork production as the disease swept through its herd [19]. Pork imports surged 314% by March 2020 [19]. Although China's domestic production recovered to pre-ASF levels by 2021, import volumes have remained elevated — U.S. pork exports to China in the first half of 2023 exceeded full-year totals from before 2018 [19]. Large Chinese hog companies gained market share at the expense of smallholders during the crisis, a consolidation pattern that has not reversed [20].

The parallel to the screwworm closure is direct. Mexico's investment in USDA-certified processing capacity is not easily unwound. Contracts negotiated during the closure period may persist. And the live feeder-cattle trade depends on infrastructure — crossing permits, inspection protocols, veterinary staffing — that atrophies during prolonged shutdowns.

What Comes Next

The confirmation of screwworm in Texas has, paradoxically, both validated the closure and made its end less foreseeable. USDA reaffirmed the import ban immediately after the Zavala County detections [9]. Canada has separately barred Texas cattle [21]. The quarantine zone could expand if additional cases are found.

The Edinburg sterile fly facility is expected to open in 2027, which would bring U.S. production capacity to 300 million flies per week [12]. Combined with Mexican facilities, the target of 500 million weekly — the same volume that eradicated screwworm from the U.S. decades ago — is within reach [12]. But eradicating a re-established population in southern Texas and northern Mexico, while the pest continues advancing from Central America, is a different challenge than the original campaign, which pushed the barrier progressively southward over 40 years.

For Texas ranchers like those at Lubbock Feeders, the timeline is existential. Kyle Williams framed the dilemma bluntly: "If they end up feeding and processing them in Mexico, how are we winning?" [3]. For Mexican producers expanding slaughter capacity in Coahuila, the calculation is the opposite — every month the border stays closed is another month to build the infrastructure that could make the live cattle trade obsolete.

The screwworm border closure is not merely a quarantine. It is a forced restructuring of a binational industry, with winners and losers separated by a line that was drawn to stop a fly.