Weekly protein report: DMC payouts offer relief amid tightening margins

4 April 2026

14 minute read

By: Jim Wyckoff

North America

Cattle futures rally on higher cash trade, bullish charts

June live cattle on Wednesday rose $1.075 to $244.35 and hit a contract high. May feeder cattle gained $1.525 to $368.00 and also hit a 5.5-month high early on. The cattle futures markets bulls are keeping their foot on the gas amid solid chart-based buying interest from the speculators. Very light cash cattle trading was reported by USDA at midday Wednesday, at $238.00. That’s well above what the agency on Monday reported for cash cattle trading last week-- averaging $235.69.

India cutting its vegetable oil imports due to constraints from Iran war

“India is slashing imports of vegetable oils due to the war in Iran driving up prices and sparking fuel shortages. The country's vegetable oil demand is expected to drop due to the slowdown in the food-service industry, with domestic edible oil prices climbing by as much as 17% over the past month,” reports Bloomberg. Import costs have risen by about 25%, and sustained demand destruction could prove a significant blow for producers, including palm exporters in Indonesia and Malaysia.

DMC payments triggered for some participants

Payments under the Dairy Margin Coverage (DMC)  program were triggered for some participants, with the February national average margin at $8.46 per hundredweight (cwt). Dairy operations that selected Tier 1 margin coverage levels of $9.50, $9, and $8.50 will be issued a payment of $1.04/cwt. for the $9.50 coverage, $0.54/cwt. For $9, and $0.04/cwt. For $8.50. 

USDA uses prices for milk and feed components (corn, premium alfalfa hay, and soybean meal) to determine the National average margin. The payments were automatically processed March 31.

Rollins backs Mandatory Country-of-Origin Labeling (MCOOL) for meat

USDA secretary frames MCOOL push as consumer transparency measure amid broader policy debates

USDA Secretary Brooke Rollins said Tuesday she is a “big supporter” of mandatory country-of-origin labeling (MCOOL) for meat products, signaling renewed interest in a policy long debated across the livestock and trade sectors.

Speaking to reporters ahead of a roundtable on implementing a federal grazing action plan, Rollins framed the issue primarily as one of consumer transparency rather than market intervention. “It’s just a transparency question,” she said, underscoring the administration’s view that clearer labeling would allow consumers to better understand where their meat originates.

The comments come as MCOOL remains a politically sensitive issue, particularly for some US cattle producers who have pushed for reinstating stricter labeling requirements to distinguish domestic beef from imported product. Supporters argue the policy could enhance demand for US-raised livestock, while opponents — including major trading partners — have historically raised concerns about trade discrimination and compliance costs. Overall the US beef industry is divided on the issue. 

Rollins’ endorsement suggests USDA may play a more active role in advancing or supporting MCOOL-related efforts, potentially intersecting with ongoing discussions in Congress and within the Trump administration on strengthening domestic agriculture and supply chain transparency.

The issue also ties into broader farm policy debates, where lawmakers have revisited labeling, livestock market structure, and trade implications as part of wider efforts to bolster US producers.

Upshot: While reiterating her support for MCOOL for meat, Rollins acknowledged that such a policy would require congressional approval. “For me, it's black and white,” she said. “Everyone in America should know where their food is coming from.”

Someone like Brooke Rollins backing MCOOL fits producer-focused populist Republican politics, even if it diverges from traditional free-trade orthodoxy. Under more traditional GOP trade policy (pre-Trump era), a Cabinet-level endorsement like this would be fairly unusual. Under the current political environment — especially within the Trump administration — it’s less surprising, given:

• Skepticism of global trade rules
• Willingness to revisit WTO-era constraints
• Emphasis on domestic production

Meanwhile, Canada and Mexico would almost certainly view a revived MCOOL regime as a direct trade violation — and respond quickly through formal dispute channels and, if needed, retaliation. Both countries successfully challenged earlier US labeling rules at the World Trade Organization, arguing they discriminated against imported livestock. A similar policy today would likely prompt immediate legal action under both WTO rules and the United States–Mexico–Canada Agreement.

Retaliation is a key risk. In the prior case, Canada and Mexico were authorized to impose more than $1 billion in tariffs on US goods, targeting politically sensitive agricultural and manufactured products. A renewed dispute could again put US exports — including meat, row crops, and potentially biofuels — in the crosshairs.

Beyond tariffs, MCOOL could disrupt tightly integrated North American livestock supply chains, forcing costly segregation of animals and potentially reducing cross-border cattle and hog flows. Both countries could respond by shifting production and processing domestically to avoid US requirements.

Bottom Line: A reinstated MCOOL regime would likely escalate quickly into a broader trade conflict, with legal challenges, retaliatory tariffs, and supply chain disruptions all in play.

Rollins highlights US egg industry ahead of White House Easter event

USDA Secretary to welcome 30,000 eggs during “Great American Egg Road Trip” stop in Washington

USDA Secretary Brooke Rollins took part in a high-visibility event Wednesday morning as the Trump administration spotlights US agriculture ahead of the annual White House Easter Egg Roll. Rollins welcomed a shipment of 30,000 real eggs arriving in Washington as part of the “Great American Egg Road Trip,” a promotional campaign tied to both the Easter tradition and the nation’s upcoming 250th anniversary celebration. The eggs — sourced from North Carolina-based Braswell Family Farms — will ultimately be used on the White House South Lawn during the April 6 event.

JBS Greeley strike enters third week as standoff drags on

Thousands remain off the job while JBS shifts production and negotiations stall

The labor strike at the JBS USA beef plant in Greeley, Colorado — one of the largest in the US — has now entered its third week, with little sign of a near-term resolution. Up to 3,800 workers, represented by the United Food and Commercial Workers Local 7, walked off the job on March 16 following months of failed contract negotiations.

Key sticking points remain unresolved

• Workers are demanding higher wages tied to inflation, improved health care benefits, and relief from out-of-pocket costs for safety equipment.
• Union members overwhelmingly rejected a company proposal that included roughly 2% annual wage increases, arguing it falls short given Colorado’s cost of living.
• The strike has also been framed as an unfair labor practice dispute, with allegations of unsafe conditions and labor violations.

Operations continue at reduced capacity. JBS has kept the plant running at limited capacity, shifting cattle and production to facilities in other states, including Texas and Nebraska, to meet customer demand.

The Greeley facility is a critical node in the US beef system, accounting for roughly 5–6% of national processing capacity, meaning prolonged disruption could ripple through cattle markets and boxed beef supplies.

Market and industry implications. The strike comes amid tight cattle supplies and record beef prices, amplifying concerns about supply chain strain. Analysts note it is too early to determine retail price impacts, but reduced slaughter capacity could tighten supplies further if the strike persists. Some industry observers suggest packers may still maintain margins in the near term due to already elevated beef prices and constrained supply.

Outlook: Negotiations remain stalled, and union leadership has warned the dispute could become a “long, drawn-out fight.” With both sides dug in — and JBS able to reroute production for now — the timeline for resolution remains uncertain, leaving cattle markets and beef supply chains closely watching developments in Greeley.

USDA’s Rollins signals possible shift to reopening US-Mexico border to Mexican cattle: Beef Buzz

US Secretary of Agriculture Brooke Rollins “is signaling a possible shift toward reopening the US–Mexico border to feeder cattle imports while continuing aggressive efforts to contain New World Screwworm. The secretary spoke with the media following her Saturday address to cattle producers attending the Texas and Southwestern Cattle Raisers,” said Beef Buzz, from the Oklahoma Farm Report. “Rollins made it clear that while the border has remained closed up to this point, conversations are intensifying about a limited reopening strategy,” said the report. “Up to this weekend, we’ve had no plan to reopen the US-Mexico border to allow Mexican feeder cattle to come back into the United States.” The report said the stance is evolving as USDA evaluates risk and geography. “We’re currently evaluating a potential phased-in strategy…. We obviously will not be opening all four ports anytime soon,” said Rollins and as reported by Beef Buzz. She pointed to the westernmost port as the most likely candidate for an initial reopening due to its distance from current screwworm activity, said the report. Secretary Rollins says producers won’t have to wait long for clarity: “More to come on that; I expect an announcement either way on that perhaps within the next two to four weeks,” she said, according to the Beef Buzz report.

USDA Quarterly Hogs & Pigs Report — March 26

USDA's National Agricultural Statistics Service released the quarterly Hogs and Pigs report on March 26, providing official inventory, farrowing, and production data as of March 1, 2026. Approximately 7,000 hog producers were surveyed across the 16 largest hog-producing states.

Overall assessment: Mixed, with a near-term bearish lean. Total inventory came in below analyst expectations — a modestly friendly surprise — but the outsized jump in heavy hog inventories (180 lbs and over) and a larger-than-expected breeding herd decline paint a complex picture. The report's most significant structural takeaway is a record pigs-per-litter rate of 11.9, confirming that productivity improvements are increasingly offsetting the structural contraction in the sow herd.

Report signals subtle supply shift — stable near-term, tightening ahead

Breeding herd contraction and softer farrowing intentions point to potential late-2026 supply tightening despite steady current inventories

Topline: Stable inventory masks emerging tightening signals

• The report shows total US hog inventory at 74.3 million head, up slightly from a year ago but down 1% from December, reinforcing a narrative of steady but not expanding supply.
• Market hog inventory rose 1% year-over-year to 68.4 million head, suggesting ample near-term supplies, though a 2% quarterly decline indicates the pipeline is beginning to contract.

Breeding herd decline is the key bullish signal

• The breeding inventory fell 1% year-over-year to 5.89 million head, a critical signal for forward supply. 
• This contraction contradicts any notion of herd expansion and instead points to reduced production capacity into late 2026.
• In past cycles, sustained declines in the breeding herd have preceded higher hog prices as supplies tighten.

Production gains driven by efficiency — not expansion

• The December–February pig crop increased 1% to 33.2 million head, despite fewer sows farrowing. 
• The driver: pigs per litter rose to 11.90 from 11.65 last year, highlighting continued productivity gains.
• This signals that current production strength is biologically driven, not structurally supported by herd growth — a dynamic that can reverse quickly if efficiency gains plateau.

Forward look: Farrowing intentions turn softer

• USDA data shows March–May farrowings slightly higher year-over-year, but
  June–August intentions down 2% from last year, signaling potential supply tightening later in the year. 
• This shift suggests the industry is beginning to respond to margin pressures and uncertainty, particularly with elevated feed and input costs.

Structural shift: Contract production continues to expand

• Operations with over 5,000 head now account for 53% of total hog inventory under contract, up from last year. 
• This reflects continued consolidation and could slow the pace of supply adjustments, as large integrators tend to maintain production levels longer than independent producers.

Market implications

Near-term (spring–summer 2026):

• Ample supplies remain in the pipeline
• Pressure on hog prices likely persists absent a demand shock
   

Late 2026 outlook:

• Breeding herd contraction + lower farrowing intentions
• Points to tightening supplies and potential price support
   

Key watch items:

• Feed costs (corn/soymeal)
• Export demand (particularly Mexico and Asia)
• Whether productivity gains (pigs per litter) continue

Bottom Line

• USDA data reinforces a two-speed hog market outlook:
• Short-term supply remains comfortable, but
• Underlying fundamentals are shifting toward tighter production later in 2026
• The report’s most important signal is not the headline inventory — but the quiet erosion in the breeding herd and forward production intentions, which historically drive the next price cycle.

Weekly USDA dairy report

CME GROUP CASH MARKETS (3/27) BUTTER: Grade AA closed at $1.8250. The weekly average for Grade AA is $1.8155 (-0.0030). CHEESE: Barrels closed at $1.5650 and 40# blocks at $1.5825. The weekly average for barrels is $1.5710 (+0.0150) and blocks $1.6305 (+0.0145). NONFAT DRY MILK: Grade A closed at $1.9225. The weekly average for Grade A is $1.9140 (+0.0880). DRY WHEY: Extra grade dry whey closed at $0.6900. The weekly average for dry whey is $0.6760 (+0.0240). 

BUTTER HIGHLIGHTS: Stakeholders in the West and East regions report steady domestic demand. Stakeholders in the Central region report strong retail demand and moderate food service demand. Export demand is mixed throughout the country. In some cases, increased transportation costs are negatively impacting demand from international buyers. Cream is tighter and significant spot volumes are not being brought into plants by butter manufacturers. Although some downtime due to snowstorms in the Central region were reported, butter production schedules are generally steady. Bulk butter overages range from 5 cents below to 8 cents above market across all regions. 

CHEESE HIGHLIGHTS: Northeast cheese production remains strong, with plants running full schedules ahead of spring holiday downtime. Milk supplies are sufficient and demand is steady. Central region milk output is steady to higher with ample milk available. Spot Class III milk prices range from $6 under to flat Class. Cheese production is rebounding after last week's storm, though some new downtime is reported. Western milk output remains seasonally strong, keeping cheese production steady. Domestic demand is steady to strong, export interest is mixed, and firmer mozzarella exports are slightly tightening supplies. 

FLUID MILK HIGHLIGHTS: Nationwide, milk production remains seasonally robust. Some areas are experiencing spring flush, bringing larger amounts of milk to production facilities. Milk components remain up from this time last year and cream production is strong. Class I is in a steady state. Some educational institutions are in spring break, so bottling production is temporarily down. Class II demand is strong. Many facilities are ramping up production in preparation for the upcoming spring holiday. Contacts report an increase in cream spot purchases for Class II use. Class III demand is steady. Retail and food service demand are up slightly, while bulk demand is steady. Class IV demand is strong. While most facilities are not purchasing spot loads of cream for butter making, production schedules are full. Milk powder is in high demand, and many manufacturers are taking advantage of the growing prices for nonfat dry milk and whole milk powder. Condensed skim demand is mixed. Some facilities are not selling condensed skim and choosing to focus on contractual obligations for milk powders, while others are selling condensed skim to Class II and Class III producers. Cream multiples for all Classes range:1.15 – 1.40 in the East; 1.08 – 1.35 in the Midwest; 1.00 – 1.27 in the West. 

DRY PRODUCTS HIGHLIGHTS: Nonfat dry milk prices posted strong gains across all regions, reaching their highest levels in two years. The largest increases occurred at the top of the high heat range in the Central and East regions and at the top of the mostly range for low/medium heat in the West. Tight inventories, particularly in the Central and East, continue to support upward movement. Dry buttermilk prices rose across all regions, with the most pronounced increases in the West. Central prices slipped at the top of the range but were otherwise steady. The West saw a slight lift at the bottom of the range, while the top of the range and mostly series were unchanged. Prices remained firm in the East. The lactose price range widened as the top held steady and the bottom moved lower. The top of the mostly series increased, supported by strong demand, steady production, and limited inventories. Whey protein concentrate 34% saw a modest increase at the top of the price range, with the rest of the series steady amid healthy demand. Dry whole milk prices were mixed: the lower end eased, while the upper end advanced on firm demand and active trading. Acid and rennet casein prices were steady. 

INTERNATIONAL DAIRY MARKET NEWS

WEST EUROPE: EU milk prices have held steady in early 2026, averaging around $42 cents per liter, as small country-level increases and decreases offset one another. Balanced supply and demand conditions across major producing regions have supported overall price stability despite minor local market adjustments. 

EAST EUROPE: Milk prices in Poland have declined sharply in early 2026, erasing gains built over the past two years as excess supply and limited export outlets weigh on the market. Falling farmgate values alongside firmer retail pricing have widened pressure on producers, while ongoing oversupply continues to challenge margins despite early signals of potential stabilization. 

OCEANIA: AUSTRALIA: Rainfall improved across much of Australia in February after a hot, dry January, though conditions varied by region. Grain and fodder prices edged down slightly, aside from mostly stable wheat values. Strong winter crop production continues to support supply, with the 2025-2026 wheat harvest projected to be the third largest on record. 

NEW ZEALAND: Export data for February 2026 was recently released for New Zealand. These data showed the value of milk powder, butter, and cheese exports in February 2026 totaled $2.1 billion, a decrease of 4.8 percent compared to February 2025. New Zealand's February milk production surged to record levels, with 183.8 million kilograms of milk solids (kgMS) collected, which is a 7.4 percent year on year increase and 7.6 percent above the five-year average. 

SOUTH AMERICA: Milk production in South America varies from steady to lighter as seasonal changes take hold. Argentina handlers note February 2026 milk production reached a twelve year high for the month, and milk solids are up by double digit percentages. Milk powder demands are mixed. Contacts indicate imports of mozzarella cheese are generally down year over year for South America. According to CLAL.it data, cheese production is up in major South America dairy-producing countries.