Pig outlook: Lean hog futures extend bull run

Livestock analyst Jim Wyckoff reports on global pig news

1 November 2024

5 minute read

By: Jim Wyckoff

North America

December lean hog futures prices this week soared to a contract high amid a steep price uptrend in place. Bulls are presently strong, but this week’s big gains suggest that a market top is now not far off. December lean hogs are technically overbought on the daily bar chart. The latest CME lean hog index is up another $1.05 to $86.78 as of Oct. 29, extending the string of gains to nine consecutive days, during which the index has jumped $2.92. Wholesale pork prices are also strong.

Latest USDA and other news regarding the global pork industry

Weekly USDA US pork export sales

Pork: Net sales of 44,800 MT for 2024 were up noticeably from the previous week and up 16 percent from the prior 4-week average. Increases were primarily for Mexico (17,700 MT, including decreases of 200 MT), China (10,400 MT), Japan (4,800 MT, including decreases of 200 MT), South Korea (3,800 MT, including decreases of 500 MT), and Canada (2,900 MT, including decreases of 700 MT). Net sales of 200 MT for 2025 were primarily for New Zealand. Exports of 32,300 MT were up 1 percent from the previous week and 13 percent from the prior 4-week average. The destinations were primarily to Mexico (11,400 MT), Japan (4,100 MT), China (3,600 MT), South Korea (2,900 MT), and Colombia (2,700 MT).

USDA warns of illegally imported meat in multi-state health alert

USDA's Food Safety and Inspection Service (FSIS) issued a health alert concerning meat and poultry products illegally imported and sold in several U.S. states without official inspection marks. The affected products, found in Arizona, California, Iowa, Kansas, Maryland, Minnesota, Nebraska, Oklahoma, and Texas, include items such as "BEST Beef Curry" and "Eain Chak Coconut Soup Paste." While no illnesses have been reported, consumers are urged to discard or return the products. The investigation is ongoing as FSIS emphasizes the public risk posed by uninspected imports.

Of note: FSIS does not refer to the products as coming from Burma. However, they do note that you can view the labels in Burmese.

USDA releases report on US feedlot practices, highlights health and antibiotic use.

USDA’s Animal and Plant Health Inspection Service (APHIS) has published the first findings from the 2021 study of US feedlots, conducted by the National Animal Health Monitoring System (NAHMS). The report, based on data from 22 states, provides insights into cattle management practices, antibiotic use, and veterinary services across the feedlot industry.

Highlights from the report include:

• Cattle origins: 54.7% of cattle placed in feedlots came directly from known operations, such as cow-calf or stocker facilities, while 38.2% were purchased from sale barns with unknown health histories.
Identification practices: 85.4% of feedlots used ear tags for individual cattle identification, with 65.5% of cattle identified either before or upon arrival at the feedlot.
Antibiotic and hormone claims: Most cattle (85.1%) were placed without meeting specific antibiotic or hormone-free marketing claims. Only 8.4% of cattle met limited or no-antibiotic claims, and 10.2% met no-hormone claims.
Antibiotic use by feedlot size: Smaller feedlots (65.4%) were less likely to use antibiotics in feed compared to medium, large, and very large operations, which reported usage rates around 35-37%.
Veterinary services: In 2020, 85.1% of feedlots used veterinarians. Larger operations were more likely to seek veterinary care, with 99.2% of very large feedlots using a veterinarian, compared to 81.2% of small feedlots.

The study also found that 64.2% of feedlots felt adequately prepared to manage the 2017 Veterinary Feed Directive (VFD) rule changes, citing access to resources and veterinary expertise. This report offers an important glimpse into the evolving practices of the U.S. feedlot industry.

FDA approves continued use of animal feed ingredients after MOU with AAFCO expires

FDA issued final guidance allowing the continued use of animal feed ingredients that were previously approved under a now-defunct Memorandum of Understanding (MOU) with the Association of American Feed Control Officials (AAFCO). This MOU, in place since 2007, facilitated the collaboration between the FDA and AAFCO in reviewing and defining animal feed ingredients. However, the MOU expired on Oct. 1 and will not be renewed.

Key points of the new guidance:

Continuation of ingredient use: The FDA has stated that it does not plan to initiate enforcement actions against the use of ingredients that were defined and listed in the 2024 AAFCO Official Publication (OP), even if they are not approved as food additives or generally recognized as safe (GRAS). This means that manufacturers can continue using these ingredients as long as they adhere to the intended use, specifications, and limitations outlined in the AAFCO OP.
New consultation process: With the expiration of the MOU, the FDA has introduced a new Animal Food Ingredient Consultation (AFIC) process. This interim process allows firms to engage with the FDA regarding new ingredient reviews that would have previously gone through AAFCO. The AFIC aims to provide a pathway for firms to consult with the FDA about new ingredients and involves public input on safety concerns.
Public and industry input: The FDA is actively seeking comments from industry stakeholders on its pre-market animal food review processes, including the Food Additive Petition (FAP) and GRAS programs. These comments will help determine if changes are needed to improve these pathways.

Of note: Despite the end of the MOU, the FDA plans to continue working with AAFCO and state regulators to ensure animal food safety. The agency will still participate in AAFCO committees and meetings.

Highly pathogenic avian flu re-emerges in British Columbia poultry flocks

After an eight-month period without any new cases, highly pathogenic avian influenza (HPAI) has re-emerged in Canadian commercial poultry flocks. The virus was confirmed on Oct. 21 at three farms located in British Columbia's Fraser Valley, specifically in the Abbotsford and Chilliwack areas. The Canadian Food Inspection Agency (CFIA) has not disclosed the specific types of poultry affected or the number of birds involved in these outbreaks. However, reports indicate that the affected farms include turkey, broiler, and egg operations.

This resurgence marks the first instance of HPAI in British Columbia's poultry sector for 2024, with the last case in the province recorded on Dec. 25, 2023. Prior to these recent detections, Canada had lifted all HPAI-related primary control zones and movement restrictions earlier this month after meeting specific conditions on previously infected premises.

The CFIA continues to emphasize the importance of maintaining strict biosecurity measures, especially as the fall migration of wild birds is ongoing, which could contribute to the spread of the virus.