Weekly protein report: USDA raises 2026 all-milk price forecast

21 February 2026

15 minute read

By: Jim Wyckoff

North America

Asia

Weekly protein report: USDA proposes faster line speeds for poultry and pork plants

Administration frames changes as supply-chain boost; labor unions raise worker-safety concerns

USDA’s Food Safety and Inspection Service (FSIS) has unveiled two proposed rules that would increase slaughter line speeds at certain poultry and pork facilities, marking a significant regulatory shift aimed at expanding processing capacity and easing food-price pressures.

The proposals — one covering poultry plants and another addressing pork facilities — cleared review at the Office of Management and Budget (OMB) on Feb. 12 after meetings with stakeholders.

Poultry: higher speeds under NPIS. Under the proposed rule for poultry establishments operating within the New Poultry Inspection System (NPIS):

• Young chicken plants could operate at speeds up to 175 birds per minute (bpm).
• Turkey plants would see their maximum allowable speed increase from 55 bpm to 60 bpm.

FSIS also proposes to formally define “maximum line speed” as the time necessary for an inspector to effectively conduct online carcass inspection procedures — a clarification intended to tie speed directly to inspection capability rather than a fixed numerical cap.

The rule would also:

• Clarify circumstances under which establishments must operate at reduced speeds.
• Eliminate the requirement that NPIS facilities submit annual worker-safety attestations.

Pork: greater flexibility under NSIS. For pork facilities operating under the New Swine Slaughter Inspection System (NSIS), USDA is proposing a more flexible framework:

• Plants would be allowed to set their own line speeds, provided they demonstrate the ability to maintain process control.
• FSIS inspectors would retain authority to reduce operational speed at any stage if there is a “loss of process control” or if carcass inspections cannot be completed effectively within the available time.

The rule would also remove annual worker-safety attestation requirements for NSIS establishments.

Industry support, labor pushback. The pork and poultry industries have largely welcomed the proposal, viewing it as a way to increase throughput, modernize inspection systems, and strengthen supply chains.

Labor unions representing meatpacking workers, however, have raised concerns about the impact of faster line speeds on worker safety and injury rates — an issue that has been contentious in prior regulatory debates over inspection reform. 

Broader policy framing. The administration is presenting the proposed rules as part of a broader strategy to:

• Increase domestic meat-processing capacity
• Improve supply-chain resilience
• Help moderate food costs for consumers

If finalized, the changes would further expand the role of plant-based inspection models under NPIS and NSIS while shifting more operational flexibility — and responsibility — to processors, with FSIS maintaining oversight authority tied to inspection effectiveness and process control standards.

Smithfield Foods to build new pork facility in Sioux Falls, SD 

Smithfield Foods, Inc. on Monday announced it will build a new state-of-the-art packaged meats and fresh pork processing facility in Sioux Falls, South Dakota. The new facility will replace Smithfield’s existing plant, which has been in existence for more than 100 years. The company currently employs 3,200 people in Sioux Falls, according to a Smithfield news release. Smithfield’s preliminary cost estimate of the proposed facility is up to $1.3 billion over the next three years. “The proposed combined fresh pork and packaged meats facility will be the most modern of its kind in the US, with highly efficient process flow, advanced automation technology and a streamlined design. The new, best-in-class facility will deliver significant efficiency gains to Smithfield’s fresh pork and high-value packaged meats operations,” the company said.

US pork secures expanded access to Taiwan market

Tariff cuts and regulatory changes mark breakthrough after 15-year industry push

US pork producers scored a significant trade victory as President Donald Trump finalized a new agreement with Taiwan that reduces longstanding tariff and non-tariff barriers on American pork exports.

The deal represents the culmination of more than 15 years of advocacy by the National Pork Producers Council (NPPC), which has pushed successive administrations to improve access to Taiwan — a high-value Asian market that has historically imposed strict import rules. “Our 15-plus year endeavor to break down trade barriers in the high-value market of Taiwan has paid off,” said NPPC President Duane Stateler, a pork producer from McComb, Ohio. “This means more US pork on international tables and more opportunities and prosperity for American producers.”

Key provisions of the agreement. The agreement delivers both tariff relief and regulatory reform:

• Tariffs cut in half on US pork exports.
• Adoption of Codex standards for ractopamine residue levels in pork fat, kidney, liver, and muscle, with a 0.09 ppm (90 ppb) limit for other edible swine offal. Standards align with those set by the Codex Alimentarius Commission.
• Elimination of restrictive import licensing procedures and removal of facility and product registration requirements that previously slowed trade flows.
• End to 100% batch-by-batch inspections for ractopamine residues, replacing them with compliance-history-based import inspection rates.
• Removal of country-of-origin labeling requirements specific to US pork.
• Automatic acceptance of eligible US plants listed in the US Department of Agriculture’s Meat and Poultry Inspection Directory, maintained by the Food Safety and Inspection Service (FSIS), without requiring additional pre-export audits.
• Recognition of USDA FSIS export certificates and electronic documentation, while limiting additional attestations.

Why it matters: Taiwan has long been viewed as a premium destination for US pork cuts and variety meats. Regulatory hurdles — particularly surrounding ractopamine — have constrained market growth for years. By aligning residue standards with international benchmarks and streamlining inspection and certification processes, the agreement could meaningfully expand export volumes and improve price realization for US producers.

Upshot: For the pork industry, which has faced volatility from tariff disputes and shifting Asian demand in recent years, the Taiwan breakthrough provides both diversification and renewed competitiveness in a strategic export market.

Cargill permanently shuttering Milwaukee beef plant

Cargill Inc. said it is permanently closing a plant that produces ground beef in Milwaukee, joining other meatpackers who have pulled back amid a severe cattle shortage. Cargill, one of the world’s largest beef producers, said in a notice that it would begin winding down operations at the plant soon, with a full closing around the end of May. The closure will result in the elimination of 221 jobs. Other companies have announced closures: Rival beef producer Tyson Foods Inc. earlier this year shut a cattle slaughtering plant in Nebraska and reduced operations at a Texas facility, while JBS NV said it would close a meat-processing plant in California.

Dairy groups are also concerned about low-priced Canadian dairy protein exports

The groups have called for scrutiny of the global nonfat milk solids market, with a US International Trade Commission report due April 27.

US Trade Representative Jamieson Greer previously identified Canada’s dairy policies as a top issue heading into the review.

Corn, ethanol, and biotech clarity. The National Corn Growers Association is seeking expanded ethanol access to Mexico and clearer biotech rules.

The US won a 2024 USMCA dispute after Mexico restricted genetically engineered corn imports. Corn leaders now want language clarifications to prevent Mexico from invoking “non-science reasons” to limit biotechnology — while avoiding a full rewrite of the agreement’s core text.

Preserving a trilateral system. The International Fresh Produce Association emphasized that USMCA must remain trilateral, not splinter into bilateral arrangements. Fresh produce supply chains, the group argues, are deeply integrated across North America, with growers and distributors managing seasonality, weather risk, and perishability across borders.

That comes as some regional producers continue pushing for stronger seasonal import protections, particularly on Mexican tomatoes — an issue the Commerce Department addressed last year by ending a longstanding antidumping suspension agreement.

Bottom Line: With USMCA’s scheduled review looming in July, the coalition is framing the debate around measurable export growth, job creation, and rural economic multipliers — while signaling that dairy access, biotech enforcement, and ethanol trade will be central battlegrounds in the negotiations ahead.

In short: keep the framework, fix the friction points

China eases duties on some EU dairy products

China has set final import tariffs on some dairy products from the European Union at as much as 11.7% following an anti-subsidy investigation, Bloomberg reported. The duties apply to goods including fresh and processed cheese and will take effect beginning Friday, according to China's Ministry of Commerce. European cheese and cream exports to China "face a very competitive market with other exporting countries," particularly those that benefit from free-trade agreements, said Alexander Anton, secretary general at trade group Euromilk. There have been efforts to deepen economic cooperation between China and the EU following a leaders summit in July, including a recent visit by French President Emmanuel Macron to China. Earlier this week, the EU moved to exempt one of Volkswagen AG’s China-built electric vehicles from hefty import duties, the first car to get approval under a new mechanism aimed at thawing tensions.

USDA Ag Outlook Conference forecasts on meat, dairy

Cattle and beef: Beef production in 2026 is forecast to decline slightly as smaller slaughter volumes outweigh higher dressed weights. Beef output fell about 4% in 2025.

• Beef exports: down 6% (after a 15% drop in 2025)
• Imports: up 3%, driven by continued demand for lean processing beef
• 5-area steer price: $240 per cwt

USDA expects tight cattle supplies to keep prices elevated.

Hogs and pork: Commercial pork production is projected at 28.3 billion pounds, up 3% from 2025.

• Exports: up 2%, supported by favorable exchange rates and disease-related disruptions in Europe
• National base hog price (51%–52% lean): $69 per cwt

USDA noted disease pressure in the US herd affected hog availability, contributing to a modest decline in slaughter numbers despite higher overall production.

Broilers: Broiler production is expected to increase 1% from 2025’s estimated 48.0 billion pounds.

• Exports: steady at 6.7 billion pounds
• National wholesale price: $1.25 per pound

Lower feed costs and productivity gains were cited as key drivers supporting continued growth.

Dairy: Milk production is projected at 234.5 billion pounds in 2026.

• Herd size: up 0.5%
• Output per cow: up 0.8%
• All-milk price: $18.95 per cwt, down from $21.17 in 2025

USDA expects larger herd numbers and improved efficiency to drive higher output, even as producer prices soften.

Bottom Line: The Outlook Forum forecasts point toward a mixed 2026 landscape — smaller corn area and more soybeans, growing soybean processing demand, continued livestock supply tightness in cattle, and lower dairy prices. Many of these assumptions — especially trade flows, biofuel demand, and export competitiveness — will hinge on policy decisions and global market conditions later in the year.

Weekly USDA dairy report

CME GROUP CASH MARKETS (2/13) BUTTER: Grade AA closed at $1.7050. The weekly average for Grade AA is $1.6705 (+0.0330). CHEESE: Barrels closed at $1.4400 and 40# blocks at $1.3875. The weekly average for barrels is $1.4400 (+0.0160) and blocks $1.4110 (-0.0205). NONFAT DRY MILK: Grade A closed at $1.6000. The weekly average for Grade A is $1.5995 (+0.0520). DRY WHEY: Extra grade dry whey closed at $0.7200. The weekly average for dry whey is $0.7220 (-0.0040). 

BUTTER HIGHLIGHTS: In the East and Central regions domestic retail butter demand is steady. In the West region domestic retail butter demand varies from lighter to steady. Domestic food service demand is moderate throughout the country. Export demand varies from steady to strong. Spot cream loads are widely available and demand is mixed. Butter production schedules are strong and plant managers at facilities that opened last year convey progress towards running at fuller capacities. 80 percent butterfat butter loads remain widely available while butter manufacturers are working to build inventories. 82 percent butterfat butter inventories are somewhat tight. Bulk butter overages range from 2 cents below to 10 cents above market across all regions. 

CHEESE HIGHLIGHTS: Eastern region cheese production is increasing with sufficient Class III milk, despite ultrafiltration (UF) bottling pulling solids from the supply chain. Retail demand is strong, while industrial demand is softer. Growing manufacturing has made prices more competitive, boosting export interest. Central region milk output and Class III demand are steady. Cheesemakers mostly use internal supplies; some plants report maintenance downtime. Retail demand is stable; food service remains light. Competitive pricing supports strong export demand, and inventories appear balanced. Western region contract milk volumes are stable, spot availability mixed, and UF milk production strong. Cheese schedules range from steady to stronger; some inventories are tight for certain varieties. Retail demand is flat and food service is weaker than early 2025. Export demand is steady to strong, with inventories varying by type. 

FLUID MILK HIGHLIGHTS: Raw milk production is steady to stronger nationwide. West region producers are reporting an increase in milk volumes while other regions report steady volumes. Milk components are strong and contacts report fat content is higher than this time last year. Contacts report manufacturing is finally back in balance after the winter storm last month. Class I demand is strong, with some producers purchasing spot loads to support demand. Class II production is steadily increasing as manufacturers prepare for seasonal upticks in demand. Some contacts report spot purchases of cream for Class II use. Class III production is steady. Some cheesemakers are experiencing down time and, as a result, selling spot loads of milk. Reported Class III milk prices range from $4-under to $1-under Class. Class IV production is steady to strong. Some facilities are purchasing spot loads of cream to meet busy production schedules while others are using contract loads. Condensed skim demand increased this week. Some facilities are seeking long term contracts to meet production needs. The condensed skim price ranged from flat Class to $0.20 over Class price. Cream multiples for all Classes range:1.00– 1.35 in the East; 0.95– 1.18 in the Midwest; 0.85 – 1.16 in the West. 

DRY PRODUCTS HIGHLIGHTS: Nonfat dry milk (NDM) prices strengthened across all regions, with the largest gains in the West, as CME Grade A NDM reached $1.64 last Friday, the highest since August 2022. Dry buttermilk prices were mostly higher, except for no change at the low end in the Central and East, while the West saw significant increases amid active spot trading and tighter availability. Dry whey markets were mixed, with no movement at the low end but slight declines at the high end of the price ranges. Mostly price ranges were up slightly in the West, and down slightly in the Central. Lactose prices edged higher at the low end and across the mostly series, supported by firm demand and tight inventories. Whey protein concentrate 34% prices were mixed, with gains at the low end and declines at the high end, while the mostly series increased at the low end. Dry whole milk prices posted strong gains across the range, driven by continued upward movement in butter and NDM. Acid and rennet casein prices remained unchanged. 

INTERNATIONAL DAIRY MARKET NEWS: WEST EUROPE: European dairy markets continue to face sustained pressure as global milk production exceeds demand, resulting in abundant raw milk availability across the region. Elevated supplies are weighing on prices for butter, powders, and other dairy commodities, while processors contend with tighter margins and rising inventories. The European Union and India have finalized negotiations on a comprehensive free trade deal to date and a step toward deeper economic cooperation. EAST EUROPE: The European dairy sector is facing a growing supply imbalance as milk production continues to outpace demand, prompting Italy, Romania, and Slovakia to call for urgent EU-level action. OCEANIA: AUSTRALIA: Dairy Australia recently released export data for Australia showing milk export volumes from July - December 2025 totaled 89,242 metric tons, an increase of 17.7 percent compared to export volume totals from July December 2024. NEW ZEALAND: Following Global Dairy Trade (GDT) event 397, a group in New Zealand that forecasts milk prices increased their milk price forecast for the 2025/2026 season by 15 cents from $9.53 per kilogram milk solids (kgMS) to $9.68/kgMS. A large New Zealand cooperative started a NZ$75 million expansion of a butter plant in the Canterbury region. The plant is the cooperative's only operation producing butter on the South Island. SOUTH AMERICA: Spring flush has passed for the Southern Cone countries of Argentina, Brazil, Chile, and Uruguay. The February World Agricultural Supply and Demand Estimates (WASDE) report was released this week, including updated corn production estimates for Argentina and Brazil. For the 2025/26 crop year, Argentina's corn crop is forecast to increase moderately. Brazil's corn crop is forecast to decline modestly. 

FEBRUARY SUPPLY AND DEMANDS ESTIMATES: Milk production is raised for 2026 on faster growth in milk per cow more than offsetting lower expected cow inventory. Fat basis imports are reduced primarily on lower imports of butter. Imports on a skim-solids basis are unchanged. Exports are raised on a fat basis on higher exports of butter and cheese, but reduced on a skim-solids basis on lower casein and lactose. Annual price forecasts for cheese, butter, nonfat dry milk (NDM), and whey are all increased for 2026 on recent prices. The Class III and IV price forecasts are also raised on higher product prices. The all milk price for 2026 is raised to $18.95 per cwt. JANUARY 

CONSUMER PRICE INDEX: The January CPI for all food is 345.2, up 2.9 percent from 2025. The dairy products index is 271.2, down 0.3 percent from a year ago. The following are January, year to year percentage changes for selected products: fresh whole milk is -0.4; cheese -1.2; and butter, -5.0. 

DECEMBER MILK SALES (FMMO): 3.8 billion pounds of packaged fluid milk products were shipped by milk handlers in December 2025. This was 1.2 percent higher than a year earlier. Estimated sales of total conventional fluid milk products increased 1.5 percent from December 2024 and estimated sales of total organic fluid milk products decreased 2.7 percent from a year earlier. DECEMBER 

DAIRY PRODUCTS HIGHLIGHTS (NASS): Butter production was 204 million pounds, 2.0 percent above December 2024 and 15.0 percent above November 2025. American type cheese production totaled 500 million pounds, 6.8 percent above December 2024 and 5.7 percent above November 2025. Total cheese output (excluding cottage cheese) was 1.28 billion pounds, 6.8 percent above December 2024 and 4.4 percent above November 2025. Nonfat dry milk production, for human food, totaled 127 million pounds, 2.7 percent below December 2024, and 17.7 percent above November 2025. Dry whey production, for human food, was 69.8 million pounds, 1.2 percent above December 2024, and 9.0 percent above November 2025. Ice cream, regular hard production, totaled 48.9 million gallons, 5.4 percent below December 2024, and 1.7 percent below November 2025. NATIONAL 

US RETAIL REPORT: In the week 7 retail dairy survey, conventional ads declined 12 percent, and organic ads are down 33 percent. The most advertised conventional commodity, cheese, appeared in 14 percent fewer ads this week. Total ads for organic milk, the most advertised organic commodity, declined 34 percent. The organic premium for a gallon container of milk is $5.33.