Though U.S. pig farmers don’t necessarily operate using the calendar year, the flip to a new year always offers a chance to look ahead. This past year offered producers profit potential, and hopefully that continues into the new year and beyond.
Just like all farmers, hog producers are anxiously awaiting a new farm bill rather than limping along with a mere extension. Those in the industry opposed to California’s Proposition 12 hold out hope that a new farm bill will contain language reversing the production restrictions in place.
As a reminder, Prop 12 was approved by California voters in 2018, and it put arbitrary restrictions on how sows/gilts, laying hens and veal were to be housed. Those restrictions stretch beyond that state’s borders, specifying that the animals that provided the pork to be sold in California must be raised in facilities meeting its requirements, regardless of where the animals are raised.
These restrictions were immediately hit with opposition. The National Pork Producers Council led the charge, asking the U.S. Supreme Court to intervene, and in 2024, the Court ruled that Prop 12’s restrictions could, in fact, go into effect.
Californians account for 13% to 15% of U.S. pork consumption, so producers in Iowa, Minnesota or North Carolina cannot necessarily turn their backs on this market. Altering production systems to meet Prop 12 demands has been a slow process, with adoption of the requirements sitting at less than 30%.
As has been stated in this space prior, some producers started adapting their facilities to meet consumers’ fickle demand, even prior to Prop 12. It would be nice if producers could recoup some of their additional investment dollars from products sold, but we know how that usually works out for the farmer.
Once (or if) a new farm bill is constructed, it remains to be seen if it will address the Prop 12 debacle.
Look beyond China
With or without a new farm bill, markets, both foreign and domestic, continue to be a driver. While bumping domestic pork consumption helps, the international market continues to be important for the U.S. producer, as about 26% of U.S. production ends up on foreign plates.
According to the latest USDA red meat export data compiled by the U.S. Meat Export Federation (USMEF), pork exports remained relatively strong in August, totaling 236,311 metric tons, down 1% from last year. That load had a value of $685.9 million down 2% from a year ago.
Mexico was once again “old reliable,” with shipments south up 8% from a year ago, and the 102,790 MT being the fifth-largest volume on record. Value of those exports comes in at $252.3 million, up 9%. This is the second highest on record, trailing only December 2024.
Due to the government shutdown, numbers for August are the most recent figures available, and pork exports from January through August were down 3% below last year’s record pace in both volume (1.93 million MT) and value ($5.48 billion).
USMEF attributes that gap to lower exports to China with the on-again, off-again retaliatory tariffs. By the time the ink is dried on this column, those tariffs could be on again or off again, so stay tuned.
In the meantime, it may be important for U.S pork to find its way into other markets. Though maybe not completely replacing the Chinese market, pork exports in August were up over a year ago to Korea, the Caribbean, Australia and the Philippines. Continuing to find other markets is beneficial, and imperative, for the U.S. pork industry.
A lot remains up in the air for U.S. pork producers, and most of it is out of their direct control. So, keep doing what you do best: producing the highest quality product that the domestic and global consumer desire.