Still reeling from the loss of the Mexican trade, Brownsville suffered another economic setback when the cattle market collapsed and the sheep industry declined into non-existance. The period of 1875 to 1885 had been an era of great prosperity for cattle ranchers. But to the ranchers' dismay, cattle that were selling for $35 a head were selling for $5 a head in 1887.
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Prices began to rise by 1895, and were back to about $35 per head by 1898. But beginning in 1890, cattle prices were again on the decline. The sheep industry, which had become a major industry in South Texas after the Civil War, began to decline locally after 1885, and by the time the railroad arrived, had almost vanished. This decline can be attributed principally to two factors. First, the large landowners, primarilly cattle raisers, fenced their lands which deprived the sheep raisers of the free range on which they depended. Second, overgrazing transformed the once lush South Texas grassland into scrub brush.
When construction of the railroad began in the summer of 1903, the economy of Cameron County had been stagnant for over twenty years, primarily due to a loss of its export-import business, fluctuating cattle prices, and the demise of the sheep industry.
