Weekly global protein digest: USDA moves to permanently increase meat processing speeds
24 March 2025
11 minute read
By: The lean hog futures market saw some mild technical selling pressure today after prices Monday challenged stiff overhead resistance but could not push above it today. Also weighing on futures prices today was news last week’s hog slaughter levels broke a string of year-to-year reductions that began in late January, as last week’s preliminary kill total was up about 2.4% from year-ago.
Limiting selling interest in futures today was news the National Pork Producers Council said all 300-plus U.S. pork harvesting and cold storage facilities have successfully renewed their registrations to export to China. This five-year renewal ensures continued market access to China for U.S. pork producers.
Lean hog futures are expected to open with a mostly weaker tone in a continuation of yesterday’s selling pressure. Lean hogs tested the upper end of the recent range yesterday before reversing lower, a testament to choppy cash fundamentals driving futures trade. The CME lean hog index is up 4 cents to $89.32 as of March 17, ending the string of recent losses. Pork cutout fell $2.01 on Tuesday, led by a $10.88 loss in primal bellies. Cutout is nearing the lower end of the recent range, which could drum up additional demand.
Bird flu strategy sparks controversy
U.S. Health Secretary Robert F. Kennedy Jr. has suggested allowing bird flu to spread in poultry flocks rather than culling infected birds, aiming to identify immune birds. RFK Jr. argued on Fox News that allowing the virus to spread would help “identify… and preserve the birds that are immune to it.” Supported by USDA Secretary Brooke Rollins, this approach has drawn sharp criticism from some scientists who warn of potential virus mutations, risks to humans, and economic fallout. With over 162 million birds culled and 70 human cases reported since 2022, concerns about food supply disruptions and rising costs remain high.
China lifts ban on Argentine poultry imports
China’s customs authority said today it has lifted a ban on poultry imports from Argentina, according to a Reuters report. Imports from Argentina were suspended in February 2023 following detection of Highly Pathogenic Avian Influenza in commercial poultry. The lift on the imports ban comes in the wake of China limiting poultry imports from the U.S.
RFK Jr. suggests new bird flu strategy
US Health Secretary Robert F. Kennedy Jr. has suggested allowing bird flu to spread in poultry flocks rather than culling infected birds, aiming to identify immune birds. RFK Jr. argued on Fox News that allowing the virus to spread would help “identify… and preserve the birds that are immune to it.” Supported by USDA Secretary Brooke Rollins, this approach has drawn sharp criticism from some scientists who warn of potential virus mutations, risks to humans, and economic fallout. With over 162 million birds culled and 70 human cases reported since 2022, concerns about food supply disruptions and rising costs remain high.
U.S. pork exports to China fully restored
The National Pork Producers Council (NPPC) announced that all 300+ U.S. pork harvesting and cold storage facilities have successfully renewed their registrations to export to China. This five-year renewal, achieved through negotiations by USDA and the U.S. Trade Representative, ensures continued market access for U.S. pork producers.
Lawmakers push Trump administration to address Canada dairy trade issues
As U.S./Canada trade tensions rise, farm-state lawmakers are urging the Trump administration to confront Canada over its dairy trade policies. Lawmakers and dairy industry groups argue that Canada is failing to meet its U.S.-Mexico-Canada Agreement (USMCA) commitments, particularly on dairy market access and export limits. In a bipartisan letter to key trade officials, lawmakers called for the administration to prioritize these issues in USMCA sunset review talks and broader trade negotiations. They criticized Canada’s restrictive Tariff Rate Quotas (TRQs), which limit U.S. dairy exports, and accused Canada of exploiting loopholes to circumvent export caps on dairy protein.
Border crackdown nets more eggs than fentanyl
President Donald Trump’s push to curb opioid smuggling at the U.S.-Mexico border has led to an unexpected result — more seizures of eggs than fentanyl. Since October, U.S. Customs and Border Protection (CBP) has intercepted 3,768 poultry-related products, compared to just 352 fentanyl seizures, as egg prices soar due to avian flu. In parts of Texas, egg smuggling has surged by 54%, and in San Diego, it has more than doubled. With U.S. egg prices reaching record highs — up to $10 per dozen — consumers and suppliers are resorting to unconventional methods, including smuggling, selling eggs individually, and even committing large-scale heists. Meanwhile, border officials are cracking down, issuing fines up to $300 for first-time offenders and destroying illicit egg cargoes.
USDA moves to permanently increase meat processing speeds
The Trump administration announced plans to permanently allow U.S. poultry and pork processing plants to operate at faster speeds, a win for meat industry groups. USDA's decision formalizes higher processing speeds currently allowed under waivers, with chicken plants processing up to 175 birds per minute.
The USDA directive instructs the Food Safety and Inspection Service (FSIS) to remove outdated requirements that have slowed production and increased costs. Key changes include extending waivers for higher line speeds in processing facilities and eliminating redundant worker safety data submissions.
USDA Secretary Brooke Rollins emphasized the importance of keeping American producers competitive globally by cutting unnecessary bureaucracy while upholding food safety. Rulemaking to formalize these adjustments will begin immediately.
Meat industry groups, such as the National Chicken Council, support increased line speeds, arguing that they are necessary for efficiency and competitiveness in the global market. The National Pork Producers Council (NPPC) praised the move for making the New Swine Inspection System (NSIS) increased line speed program permanent. According to NPPC President Duane Stateler, this move will provide financial security and stability for pork producers, preventing potential losses of up to $10 per hog.
The announcement was also cheered by House Ag Chairman Glenn “GT” Thompson (R-Pa.) and Senate Ag Chairman John Boozman (R-Ark.) in a statement said, “This is great news for American meat and poultry companies that continuously lead food and worker safety standards worldwide. We applaud [USDA] Secretary Rollins for taking quick and decisive action to allow these businesses to expand their operations in a safe and efficient manner. We look forward to continued collaboration with the administration throughout the rule making process.”
USDA: Opportunities for US Swine Genetics to China
USDA reports China is a significant market for U.S. swine genetics; U.S. live (breeding) swine exports to China were valued at $15.7 million in 2023. China produces approximately half the world’s pork and needs to import 5,000 to 10,000 head of purebred swine every year – with an estimated value of $15 to $30 million. U.S. exports of live breeding swine from 2017 to 2024 accounted for 36 percent of China’s live breeding swine imports; France and Denmark were our primary competitors. Swine semen does not currently have market access to China.
Canada resumes U.S. pork imports after temporary suspension
Canada has resumed imports from Smithfield Foods’ Tar Heel, North Carolina, pork-processing plant after a week-long suspension, the company confirmed. The temporary halt, which lasted from March 6 to March 12, stemmed from an issue with offal shipments at the border and was not related to tariffs, according to Smithfield CEO Shane Smith. The suspension briefly disrupted a key export market amid ongoing trade concerns for U.S. pork producers, who fear the impact of tariff disputes with major buyers like Canada, Mexico, and China.
U.S. seeking to import eggs
USDA has reached out to Denmark and other European nations to explore egg imports as domestic prices surge due to a worsening bird flu outbreak, Reuters reported. Wholesale egg prices in the U.S. have hit record highs, rising 59% year-over-year in February, despite President Donald Trump's earlier pledge to lower them. A letter reviewed by Reuters shows that U.S. officials formally inquired about European egg supplies in late February, with follow-up requests to Denmark in early March. However, the Danish Egg Association noted that Europe is also facing shortages due to increased consumption and avian flu.
USDA: Argentina Livestock and Products Semi-annual report
Argentine beef exports in 2025 are forecast to decline to 770,000 metric tons carcass weight equivalent (CWE), primarily due to a projected decrease in beef production and production costs in dollar terms that are higher than those of neighboring competitor countries. The 2025 cattle slaughter is projected at 13.4 million head, lower than previously estimated due to the early slaughter of some cattle in 2024 in response to weather and market conditions. Domestic beef consumption is expected to remain unchanged from previous forecasts and from 2024 levels.
Weekly USDA dairy report
CME GROUP CASH MARKETS (3/14) BUTTER: Grade AA closed at $2.3425. The weekly average for Grade AA is $2.3325 (+0.0350). CHEESE: Barrels closed at $1.6900 and 40# blocks at $1.6925. The weekly average for barrels is $1.6680 (-0.0325) and blocks $1.6950 (+0.0570). NONFAT DRY MILK: Grade A closed at $1.1550. The weekly average for Grade A is $1.1585 (-0.0165). DRY WHEY: Extra grade dry whey closed at $0.4500. The weekly average for dry whey is $0.4715 (-0.0265).
BUTTER HIGHLIGHTS: Domestic retail butter demand remains mixed across the country. Some sellers indicate buyers are starting to show more interest. Domestic food service demand is less mixed, but also generally less robust than retail demand. Concerning export demand, unsteady selling/purchasing factors are creating some reluctance for sellers and buyers. Like cream availability in the week prior, plenty is available this week, and plenty of it continues to make its way into butter churns. Butter production is strong throughout the nation. Bulk butter overages range from 10 cents below to 5 cents above market, across all regions.
CHEESE HIGHLIGHTS: Cheese production schedules range from steady to stronger throughout the U.S. In the East region, contacts share busy cheese production schedules. Retail demand has increased while food service demand remains quiet. Contacts share cheese supply and demand is balanced. Cheesemakers in the Central region relay active production activity. Milk availability is stable with spot milk prices reported at $2.50 under Class to $0.30 above Class III. Contacts share cheese inventories have grown as has spot load availability. Cheesemakers in the West region share mixed production activity despite seasonal increases in milk production. Some unexpected downtime at plants led to lighter cheese production. Cheese availability is able to match end user’s needs.
FLUID MILK HIGHLIGHTS: U.S. milk production is largely progressing toward spring flush with steady to stronger output levels. While the demand for milk from processors is largely steady, there are some parts of the country that have a decrease in Class I demand as educational institutions enter spring breaks. Milk availability is in balance with demands. Central spot milk prices ranged from $2.50 under Class III to $.30-over Class. Cream supplies remain abundant nationwide. Butter churning remains busy. Cream suppliers are expecting an increase in activity from other cream users as the weather warms and the spring holidays approach. Condensed skim milk loads are becoming more available each week, but demand is mixed. Cream multiples for all Classes are 0.95 – 1.15 in the East, 0.85 – 1.10 in the Central region, and 0.50 – 1.05 in the West.
DRY PRODUCTS HIGHLIGHTS: A number of dry dairy commodities faced more bearishness this week. Low/medium heat nonfat dry milk prices were lower across the country. Dry whey prices followed suit. Dry buttermilk prices were pushed lower. Processors of each of these suggest similar market conditions: growth in milk availability, therefore processing, and uncertain market sentiment has created a wait-and-see approach from customer bases. Lactose prices held steady, as most trading activity remained on Q1 contractual agreements. Whey protein concentrate 34% continues to be the diamond in the rough among dairy commodities, as prices maintained bullish momentum based on steady demand and limited availability. Dry whole milk prices shifted lower, while rennet and acid casein prices were static this week.
INTERNATIONAL DAIRY MARKET NEWS: WEST EUROPE: The UK-based Agriculture and Horticulture Development Board released milk delivery data for the week ending March 1. Daily milk deliveries averaged 34.71 million liters, up 1.6 percent from the week prior and up 2.0 percent from the same week last year. German agriculture officials announced China will resume importing heat-treated dairy products in the wake of Germany's foot and mouth disease outbreak in January.
EAST EUROPE: The National Food Chain Safety Office of Hungary announced an outbreak of foot and mouth disease on a dairy farm in Kisbajcs near the Slovakian border. Until further notice the export of cattle, sheep, goats, and pigs is prohibited to other EU member states or nonmember countries.
AUSTRALIA: According to Dairy Australia, December 2024 drinking milk sales, 190.8 million liters, were down 2.7 percent from December 2023. The volume of milk sold was down in December 2024 from a year prior in every state.
NEW ZEALAND: The New Zealand Agriculture Minister declared a drought in Taranaki at the end of February. This declaration was extended to Northland, Waikato, Horizons, and Marlborough last week. The affected regions have been experiencing extended hot and dry conditions, reducing pasture growth rates and reducing available groundwater. Recently released data from New Zealand for January showed the number of dairy cows sent to slaughter during the month increased by 9.9 percent from January 2024.
SOUTH AMERICA: Both contacts and market analysts are in agreement that South American milk production, in toto, has met or exceeded expectations this summer. As Q1 trading has been contractually locked in regarding dairy commodities, contacts expect few to no shifts in market conditions to take place before the onset of Q2.
US NATIONAL RETAIL REPORT: Conventional dairy advertisement totals during week 11 decreased 11 percent, while organic dairy ad totals decreased 8 percent. Conventional ice cream in 48-to-64 ounce containers was the most advertised single item this week by a large margin, as those ad totals increased 66 percent from week 10. Ad totals for organic half-gallon milk are virtually unchanged from week 10, and organic half-gallon milk remains the most advertised organic item this week. Organic half-gallon milk has a weighted average advertised price of $4.56, $2.63 more than conventional half-gallon milk. As a commodity, conventional milk ad totals moved 3 percent lower, while organic milk ad totals decreased by 17 percent from week 10.
