7 December 2024

12 minute read

By: Jim Wyckoff

North America

Asia

Oceania

Weekly USDA US beef, pork export sales

Beef: Net sales of 100 MT for 2024--a marketing-year low--were down 97 percent from the previous week and 99 percent from the prior 4-week average. Increases primarily for Japan (1,700 MT, including deceases of 1,000 MT), Canada (700 MT, including decreases of 100 MT), China (600 MT, including decreases of 1,700 MT), Mexico (400 MT, including decreases of 100 MT), and Taiwan (200 MT, including decreases of 300 MT), were offset by reductions for South Korea (3,300 MT), Hong Kong (500 MT), and Saudi Arabia (100 MT). Net sales of 13,700 MT for 2025 were primarily for South Korea (7,000 MT), China (3,000 MT), Japan (1,700 MT), Hong Kong (1,200 MT), and Mexico (300 MT). Exports of 14,400 MT were down 1 percent from the previous week and 6 percent from the prior 4-week average. The destinations were primarily to South Korea (3,900 MT), Japan (3,400 MT), China (2,100 MT), Mexico (1,500 MT), and Taiwan (1,100 MT).

Pork: Net sales of 35,200 MT for 2024 were up noticeably from the previous week and from the prior 4-week average. Increases primarily for Mexico (15,400 MT, including decreases of 200 MT), South Korea (9,100 MT, including decreases of 1,300 MT), China (3,400 MT), Australia (2,300 MT), and Japan (2,200 MT, including decreases of 600 MT), were offset by reductions for Malaysia (400 MT) and Hong Kong (400 MT). Net sales of 26,600 MT for 2025 were primarily for China (10,300 MT), Mexico (8,700 MT), South Korea (5,300 MT), Colombia (1,000 MT), and Japan (500 MT). Exports of 32,200 MT were up 14 percent from the previous week and 2 percent from the prior 4-week average. The destinations were primarily to Mexico (12,700 MT), Japan (3,700 MT), South Korea (3,600 MT), China (3,500 MT), and Canada (2,100 MT).

FDA and USDA seek input on food date labeling practices to combat waste

FDA and USDA issued a joint Request for Information (RFI) to gather insights on food date labeling, such as "Sell By," "Use By," and "Best By," aiming to address consumer confusion and its contribution to food waste. The RFI seeks data on industry practices, consumer perceptions, and the economic and environmental impacts of date labeling.

Estimates suggest that confusion over labeling contributes to 20% of household food waste, costing the average family of four $1,500 annually. The RFI supports the National Strategy for Reducing Food Loss and Waste, which targets a 50% reduction by 2030.

Stakeholders have 60 days to comment, helping shape future policies or educational campaigns. Further information on how to submit a comment can be found in the Federal Register.

Trump, RFJ Jr., tallow, and health

President-elect Donald Trump's campaign visit to a Pennsylvania McDonald’s spotlighted the use of beef tallow, a past ingredient in McDonald’s fries. Critics saw the visit as at odds with his "Make America Healthy Again" promise, a slogan introduced after Robert F. Kennedy Jr. joined his campaign. In defense, Kennedy argued on X that Americans should enjoy indulgences without fearing harmful additives, highlighting a balanced approach to health.

Beef tallow is making a comeback, championed for its potential health benefits and versatility in cooking and skincare. Once a staple in kitchens and fast-food chains like McDonald's, this rendered beef fat was replaced by vegetable oils in the mid-20th century due to health concerns over saturated fats. However, experts now argue that tallow may be healthier than previously believed. Consider:

• Nutritional benefits: Tallow is rich in fat-soluble vitamins (A, D, K) and contains conjugated linoleic acid (CLA), which may help prevent certain diseases.
  
• Cooking advantages: With a high smoke point and stable saturated fats, it’s a safer choice for frying compared to seed oils, which oxidize and form harmful compounds.
  
• Health debate: Some experts criticize the vilification of saturated fats, linking modern health issues to processed foods and seed oils instead. Others caution moderation for those with cardiovascular risks.
  
• Cultural spotlight: Renewed interest was sparked by political campaigns and social media, with advocates calling for a return to beef tallow in frying oils.
  
  Beyond cooking, tallow’s emollient properties make it a useful ingredient in skincare. While its resurgence stirs debate, advocates argue it honors traditional practices and reduces waste, aligning with holistic health trends.

Walmart CEO on food inflation, e-commerce, and future trends

Walmart CEO Doug McMillon projects continued food inflation into 2025, driven by pressures on eggs, dairy, cocoa and other inputs. Speaking at the 2024 Morgan Stanley Global Consumer and Retail Conference, McMillon expressed optimism about consumer resilience despite climbing prices. He noted that egg and milk prices might stabilize faster than processed foods, which could remain elevated next year.

Walmart’s pricing strategies and supply chain upgrades have bolstered its market position, with strong food unit volume growth and leadership in consumer-packaged goods (CPG) market share. The retailer’s e-commerce business, particularly Walmart Marketplace, continues to grow, achieving double-digit gains for six consecutive quarters.

Looking ahead, McMillon emphasized investments in automation, social commerce, and personalization as key drivers for Walmart’s evolving retail strategy.

First Circuit weighs national impact of Massachusetts pork law

The First Circuit Court is evaluating the constitutionality of a Massachusetts law that mandates humane confinement standards for pigs whose pork is sold in the state. The law, which bans sales of pork from pigs confined in restrictive stalls, has drawn criticism from pork processors like Triumph Foods LLC. They argue it imposes undue burdens on out-of-state producers, potentially violating the Commerce Clause of the U.S. Constitution. Supporters of the law point to the Supreme Court’s 2023 decision upholding California’s humane-pork law, suggesting the Massachusetts regulation is not discriminatory. The case could have far-reaching consequences for the U.S. pork industry, with concerns over how varying state laws might reshape national production standards.

China’s sow herd, hog slaughter contract

China’s sow herd totaled 40.73 million head at the end of October, according to the ag ministry, down 3.2% from year-ago. Through the first 10 months of the year, China’s hog slaughter fell 2.6% from the same period last year to 264.21 million head.

China lifts final trade restrictions on Australian meat processors

China has lifted trade restrictions on two Australian meat processing facilities, allowing the full resumption of red meat exports to the country, the Australian government said. Beijing has now removed restrictions from all 10 Australian meat processors it banned between 2020 and 2022. China is the second largest market for Australian beef and veal after the United States.

Update on the New World Screwworm (NWS) situation between the U.S. and Mexico

On Nov. 22, Mexican authorities notified USDA’s Animal and Plant Health Inspection Service (APHIS) of a positive NWS detection in Chiapas, a southern Mexican state bordering Guatemala. The infected cow was discovered at a livestock inspection checkpoint near the Guatemala-Mexico border. In response, APHIS took immediate action:

• Import restrictions: The U.S. has temporarily suspended the importation of live cattle and bison from Mexico.
• Enhanced surveillance: APHIS is intensifying its collaboration with Mexican and Central American partners to monitor and control the infestation.
• Sterile fly releases: Strategic aerial and ground releases of sterile flies are being conducted throughout Central America to disrupt the pest's reproduction cycle.
  
  The detection of NWS in Mexico raises serious concerns for several reasons:
• Rapid spread: The parasite has moved nearly 700 miles from the Nicaragua-Honduras border to Mexico in just two and a half months.
• Economic impact: The U.S. typically imports a significant number of cattle from Mexico annually. As of Nov. 21, imports had reached 1,208,354 head, up from 1,067,344 in the same period in 2023.
• Threat to livestock and wildlife: NWS can infest any warm-blooded animal, posing a risk to livestock, wildlife, pets, and even humans.
• Potential reintroduction: There are fears that the pest could re-enter the U.S., where it was eradicated decades ago at a cost of approximately $800 million.
  
  The Wildlife Conservation Society (WCS) has urged the U.S. and Mexico to implement immediate measures, including:
  
• Strengthening border controls and inspection protocols
• Enhancing regional cooperation to combat illegal cattle trafficking
• Increasing support for eradication efforts in Central America

WHO calls for stronger surveillance of H5N1 among animals

A World Health Organization (WHO) official on Thursday called for stronger surveillance in animals for evidence of infection with H5N1 to curb its spread. The official also urged stronger efforts to reduce the risk of transmission of the virus to new species of animals and to humans. The agency said it is in touch with partner agencies such as the World Organization for Animal Health and Food and Agriculture Organization to increase surveillance in animals.

Texas farmers blame sewage-based fertilizer for poisoning land, livestock

According to The Texas Tribune, Texas farmers are grappling with devastating losses they attribute to fertilizers made from sewage biosolids contaminated with "forever chemicals" (PFAS). These substances, linked to severe health risks, were found in fertilizers promoted as environmentally friendly. In Johnson County, ranchers Tony Coleman and James Farmer report losing dozens of livestock and fish after PFAS-tainted runoff from a neighbor's fertilized fields entered their properties. Investigations revealed alarmingly high PFAS levels in local water, soil, and animal tissues. The Colemans and other affected farmers have filed lawsuits against the fertilizer companies, accusing them of failing to disclose the contamination risks. Despite mounting evidence, federal regulations on PFAS in biosolids remain absent, leaving farmers like Coleman facing financial ruin while refusing to sell potentially contaminated livestock.

USDA publishes final decision on FMMO update

The final decision on reforms to the 11 Federal Milk Marketing Orders (FMMOs) was published in the Federal Register. USDA’s Agricultural Marketing Service (AMS) will send out ballots to eligible parties and the agency previously said those ballots must be postmarked Dec. 31, 2024, and returned by Jan. 15, 2025, to be counted.

Weekly USDA dairy report

CME GROUP CASH MARKETS (11/27) BUTTER: Grade AA closed at $2.4925. The weekly average for Grade AA is $2.4967 (-0.0643). CHEESE: Barrels closed at $1.6050 and 40# blocks at $1.6425. The weekly average for barrels is $1.6283 (-0.0757) and blocks $1.6775 (-0.0170). NONFAT DRY MILK: Grade A closed at $1.3950. The weekly average for Grade A is $1.3867 (-0.0028). DRY WHEY: Extra grade dry whey closed at $0.7100. The weekly average for dry whey is $0.6867 (+0.0412).

BUTTER HIGHLIGHTS: Butter demand is mixed for the holiday week. Although stakeholders in the Northeast note slightly tighter cream volumes, loads are readily available across most of the nation. Many butter producers are not looking to secure spot loads and turning away spot cream load offers. Like butter demand, butter production schedules are mixed for the holiday week also, with some butter producers noting various degrees of downtime for the final week of the month. A few butter manufacturers indicate shifting more of the production focus to bulk butter. Bulk butter overages range from minus 2 to 8 cents above market, across all regions.

CHEESE HIGHLIGHTS: Cheese manufacturing schedules remain varied throughout the U.S. In the East region, milk volumes remain somewhat snug. Cheese plant managers relay using all the milk available to them for production. Contacts in the region share retail demand remains strong. Cheesemakers in the Central region are running seasonally steady production schedules. Cheese plant managers share surplus milk loads are not as available as they have been during previous Thanksgiving weeks. Spot milk loads were reported at $3 below Class III to at Class. Both curd and barrel producers share demand is slightly quieter. In the West region, cheese production is steady. Cheese manufacturers share milk volumes are readily available for processing needs.

FLUID MILK HIGHLIGHTS: Farm level milk outputs are mixed across the country. Steady volumes are being seen in the East and Central regions as favorable weather and good feed quality contribute to milk production. Most of the West region is experiencing stronger volumes, except for the Pacific Northwest where milk production is reported to be steady to somewhat weaker. Class I activity has been busy this fall. Demand for bottled milk has been strong over the past few months. Demand for other Class I bottling has also picked up in recent weeks. Demand for milk for Class III continues to be strong. Cheesemakers report somewhat available holiday-level spot milk. In the Midwest, spot milk prices were anywhere from $-3.00 under Class III to flat Class. Cream is readily available throughout the country. Some contacts in the northeast are reporting cream is available, but it is tightening slightly. Stakeholders in the West are reporting cream multiples moving higher on both ends of the price range. Cream handlers relay they are expecting an abundance of cream to be available as butter plants and other cream end usage facilities plan for multiple days of downtime. Class IV demand for cream remains steady, and increased seasonal demand for cream is being seen in Class II and Class III.Cream multiples for all Classes range 1.00-1.26 in the East, 1.00 1.22 in the Midwest, and 1.00-1.35 in the West.

DRY PRODUCTS HIGHLIGHTS: The holiday-shortened trading week did little to slow down market bulls for dried dairy ingredient markets this week. Prices were generally steady for low/medium heat and high heat nonfat dry milk (NDM) this week on limited reporting trading activity. Still, markets are viewed as firm as the final month of the year approaches. Dry buttermilk prices were steady to higher throughout the country. In the West, where dry buttermilk prices ticked higher, availability ranges from tight to moderate. Dry whole milk prices decreased during the holiday week, as milkfat components continue to edge higher month after month. Dry whey prices were mixed through the regions, but market tones remain steadfastly bullish, particularly for brand-preferred dry whey. Whey protein concentrate (WPC) 34% prices continue their ascendence. Domestic demand for WPC 34% is hearty. Lactose prices moved higher, and processors say 2025 contracts are showing little signs of a demand lapse. Acid and rennet casein prices were unchanged.

ORGANIC DAIRY MARKET NEWS: The USDA Farm Service Agency (FSA) extended the application deadline for the Organic Dairy Marketing Assistance Program (ODMAP) 2024 to December 13, 2024. The USDA Economic Research Service (ERS) recently released an article discussing expansion in the domestic organic milk in the last 30 years. The number of organic milk cows grew 1992 to 2021, and from 2008 to 2021 organic milk production increased. The number of organic retail ads declined in the week 47 retail ad survey. The most advertised organic commodity in the week 47 retail survey was milk. Yogurt overtook cream cheese as the second most advertised organic dairy commodity. Organic sour cream and eggnog appeared in the week 47 survey, after not appearing in week 46.

NATIONAL RETAIL REPORT: Despite fewer advertisements being surveyed due to the shortened holiday week, decreases in total dairy advertisements were not as heavy as last year. This week, total conventional dairy ad totals decreased six percent, while organic advertisement numbers declined 18 percent. A few specific commodity totals increased despite the lower store tally. Seasonal staples like conventional flavored milk, for instance, bounded nearly 500 percent this week, while ads for conventional eggnog increased four percent.