ANALYSIS: Bacon's Market Journey Through 2023

According to the most recent data from Circana on COMTELL, as of October 15, 2023, the average price of non-discounted bacon across all U.S. foods was $6.66/lb. This figure was preceded two weeks prior by the highest price recorded this year, at $6.95/lb. In the period from January to May of 2023, supplies of bellies in cold storage saw an increase, attributed to lackluster interest in bacon from foodservice sectors during the first half of the year. However, a decline in both frozen and fresh belly supplies became evident...

New Jersey Governor Murphy Signs Legislation Banning Gestation Crates

On Wednesday, New Jersey Governor Phil Murphy signed legislation (A-1970/S-1298) requiring the State Board of Agriculture and the Department of Agriculture to "adopt rules and regulations concerning the confinement, care, and treatment of breeding pigs and calves raised for veal", according to a press release. 

The bill "prohibits confinement in an enclosure that impacts a breeding pig and calf’s ability to freely move in certain ways and properly groom itself and that limits visual contact with other calves." Specifically, the law requires a minimum of 24 square feet ...

Triumph Foods, Midwest Farmers Challenge Constitutionality of Massachusetts Question 3

Triumph Foods filed a lawsuit in Massachusetts federal district court challenging the constitutionality of the state law known as Question 3 (Q3) and, in turn, similar laws like it, including California’s Proposition 12 (Prop 12). Christensen Farms Midwest, LLC, The Hanor Company of Wisconsin, LLC, New Fashion Pork, LLP, and Eichelberger Farms, Inc., also joined the suit as plaintiffs, along with the Allied Producers’ Cooperative, a group of smaller Midwest farmers.

The lawsuit also seeks preliminary injunctive relief to stay the...

U.S. Interstate Pork Commerce Faces Uncertain Future As States Implement New Restrictive Laws

On May 11, the Supreme Court of the United States (SCOTUS) upheld a lower court’s ruling to preserve California Proposition 12 (Prop 12), which prohibits the sale of pork not produced according to the state’s production standards. This means restaurants in California will now have to source pork that meets these standards.

California requires that all pork sold in the state must come from farms that house sows with at least 24 square feet each and ensure their ability to stand up and turn around in their... 

Proposition 12 Distributor Guidance Document Released by CDFA

The California Department of Food and Agriculture’s (CDFA) Animal Care Program released a new guidance document on its website detailing the on-site inspection requirements for a distributor obtaining a third-party certification according to Proposition 12's regulations. 

California's Proposition 12, which began as a ballot initiative in 2018, went into effect on July 1, 2023. The law requires veal calves, breeding pigs and egg-laying hens to be housed in confinement systems that comply with specific minimum standards for freedom of movement, cage-free design, and minimum floor space. Any...

Massachusetts Question 3 Stay Extended to August 23

Massachusetts

In August 2022, the Massachusetts Restaurant Association, along with additional plaintiffs, filed an Emergency Motion for Preliminary Injunction of Massachusetts’ Question 3 (Q3) in the United States District Court for District of Massachusetts, which resulted in a stay of enforcement of Q3 until after the Supreme Court of the United States ruled in a case involving California’s Proposition 12. The judge in the Massachusetts case signed a subsequent order extending the previously agreed upon stay until August 23, 2023. Massachusetts has agreed to not enforce Question 3 as it relates to...

CDFA Releases Updated July 1 Proposition 12 Q&A

The California Department of Food and Agriculture’s (CDFA) Animal Care Program released an updated Q&A for Proposition 12, which started as a ballot initiative first approved by the state's voters in 2018. Prop 12 mandates minimum housing requirements for veal calves, breeding pigs, and egg-laying hens and prohibits a producer from selling products in California that came from a covered animal confined in a cruel manner. 

In mid-June, the Superior Court for the County of Sacramento signed an order that provided an extension for the continued sale of non-compliant whole pork meat in California that was already in the supply...

CDFA Hosts Pork Producer Webinar in Part Three of Prop 12 Series

In part three of the California Department of Food and Agriculture’s (CDFA) Animal Care Program Proposition 12 webinar series, the CDFA explained requirements for producers keeping or housing breeding pigs. 

Last week, the judge in the Superior Court of California for Sacramento County amended a previous order and extended the enforcement date until December 31, 2023, for “noncompliant” whole pork meat in inventory as of July 1, 2023, the North American Meat Institute (NAMI) explained.

Meat from noncompliant hogs slaughtered before July 1 can be sold in California...

The Retail Rundown: Which Proteins Dominate Holiday Features?

Leading up to the Fourth of July holiday, seafood and pork feature volume dominate retail buying opportunities. Seafood features account for 28.5% of total protein features while pork comes in with 26.7%. Beef falls to third with 25.3%, followed by chicken with 17.1%.

According to the National Retail Federation's annual Independence Day survey, 87% of consumers plan to celebrate the Fourth of July this year and spend an average of $93.34 on food items. Total spending is expected to reach a record $9.5 billion, up from $7.7 billion in 2022. Of those celebrating, 65%...

North American Meat Instutute: Update on California Proposition 12

Yesterday, the judge in the Superior Court of California for Sacramento County presiding over litigation regarding enforcement of Proposition 12 amended a previous order and effectively extended the enforcement date until December 31, 2023, for “noncompliant” whole pork meat in inventory as of July 1, 2023.[1] Meat from noncompliant hogs slaughtered before July 1 can be sold into California and designated as “compliant.” Companies should maintain documentation showing products are from hogs slaughtered prior to July 1. Importantly, unless one of the exemptions applies, this extension does not allow sales...

New Jersey Bill Banning Gestation Crates Passes State Senate

New Jersey bill A1970 Acs (ACS), sponsored by Senator Vin Gopal (D-11) and Assemblyman Raj Mukherj (D-33), passed the state Senate this week. It now heads to New Jersey Governor Murphy for his signature, who has 45 days from June 20, 2023 to act. 

Similar to California's Proposition 12, the bill sets animal-welfare standards for meat sold within the state. Specifically, it establishes criminal offenses and civil penalties concerning the inhumane confinement of breeding pigs and calves raised for veal. It requires 24 square feet of usable floor space per breeding pig and 43 square feet of usable floor space per calf. The animals must be able to fully extend their limbs and turn around freely....

NPPC Statement on California Proposition 12 Implementation Modification

“It is welcome news to America’s pig farmers and consumers that California recognized the challenging situation the July 1 Proposition 12 implementation date will have on our industry and food supply. Granting six months of additional relief for products in the supply chain allows grocery stores to remain stocked so the 40 million Californians have uninterrupted access to affordable, safe and nutritious pork products, especially with rising food prices.

“We appreciate Governor Newsom, Attorney General Bonta, and the California Department of Food and...

The Retail Rundown: Bring "Fourth" the Deals

Retailers are bringing "fourth" the deals for shoppers this week and next ahead of Independence Day, or the third leg of summer grilling occasions (the first two being Memorial Day and Father’s Day). 

The Fourth of July is the last major buying occasion of the summer until Labor Day, meaning grocers are actively promoting protein sales before we enter the dog days of summer. While the weather will influence sales for the upcoming holiday, retailers are also considering that this year’s holiday falls on Tuesday. This could potentially affect consumers' plans for cookouts...

Senator Marshall Introduces EATS Act Ahead of  Prop 12 Implementation Date

On Thursday, Senator Roger Marshall (R-KS), introduced a bill called the Ending Agricultural Trade Suppression (EATS) Act, to “prevent States and local jurisdictions from interfering with the production and distribution of agricultural products in interstate commerce, and for other purposes”.

Congresswoman Ashley Hinson will be leading this effort in the U.S. House of Representatives, added Marshall's office. The EATS Act would prevent states like California from regulating farmers nationwide. 

"The United States is constantly faced with non-tariff trade barriers from protectionist countries, hurting American agriculture's access to ...

Cattle Complex Slips at Midweek While Hogs Rally on Firmer Cash

The cattle complex on the Chicago Mercantile Exchange tumbled at midweek, sending August live cattle sliding to a nearly two-week floor. Feeder futures led the declines, with losses for the August through November contracts ranging from $4.05 to $4.55 per cwt despite weaker corn prices at the closing bell for livestock futures.

Grain futures are up sharply so far Thursday as traders monitor dry conditions in the nation's major crop-producing regions. Corn futures are up by about 9 to 10 cents and soybeans are showing...

CDFA Explains Distributor Requirements in Part Two of Prop 12 Webinar Series

In part two of the California Department of Food and Agriculture’s (CDFA) Animal Care Program Proposition 12 webinar series, the CDFA explained requirements for distributors selling or distributing covered products to an end-user in California.

Dr. Elizabeth Cox, Animal Care Program Manager at CDFA, and Dr. Annette Jones, Director of the Animal Health and Food Safety Services Division at CDFA, hosted Tuesday's webinar.

The distributor is one step above the end user. End-users are as follows: retail location (no further distribution), a consumer (personal consumption), restaurant of a food facility, or a food processing facility or cottage food operation...

NAMI Hosts Prop 12 Webinar With California Department of Food and Agriculture

On Monday, the North American Meat Institute (NAMI) along with the California Department of Food and Agriculture (CDFA) hosted a webinar exploring enforcement, documentation, and transition ahead of Proposition 12, which is set to go into effect July 1.

Speakers included Dr. Elizabeth Cox, who currently leads the Animal Care Program for the California Department of Food and Agriculture, and Dr. Anette Jones, Director of the Animal Health and Food Safety Services at CDFA.

Proposition 12 is a California law first approved by California voters...

Live Cattle and Feeder Futures Snap Streak of Higher Closes

After scoring fresh contract highs again at midweek, live cattle futures finished sharply lower Wednesday, snapping their nine-day streak of firmer closes. 

The June live cattle contract closed 82.5 cents lower at $179.00 per cwt but remains overbought. The deferred contracts formed outside bearish reversals. 

Feeder futures also scored new highs yesterday before nosediving, sending most actively traded August to a nearly one-week floor. The front-month finished $4.15 lower at $239.10 per cwt while September was down $4.25 to $242.275 per cwt...

CDFA Addresses Questions for End-Users in Proposition 12 Webinar

The California Department of Food and Agriculture’s Animal Care Program is hosting a series of webinars reviewing the regulations and requirements of Proposition 12, which the Supreme Court upheld on May 11, 2023.

The first of three webinars titled “End-Users – retailers, restaurants, food processors” took place on Tuesday, June 6 at 2:00 p.m. Eastern time. The speakers included Dr. Elizabeth Cox, Animal Care Program Manager at the California Department of Food and Agriculture (CDFA), and Dr. Annette Jones, Director of the Animal Health and Food Safety Services Division at CDFA... 

The Retail Rundown: Attractive Pork Features Could Entice Consumers This Summer

Competitive retail pork prices this summer could entice more consumers to favor pork over other proteins, especially as beef production continues to decline due to tightening cattle supplies.

Retailers are still aggressively promoting beef, which make up 29.9% of total retail buying opportunities. Seafood closely follows with 28.7%, while pork ranks third at 21.3%. Chicken has 14.4% of total ad space, down about 3% from the week prior. 

Within pork, brand-label bacon features make up the majority of features this week. According to the latest Circana data for...

CDFA Releases Guidance on Pork Sales Following Proposition 12 Ruling

The California Department of Food and Agriculture’s Animal Care Program released an FAQ related to pork sales following the Supreme Court’s decision to uphold Proposition 12. 

The housing requirements for a breeding pig under Proposition 12 went into effect on January 1, 2022.  Enforcement of that provision was enjoined in February 2022 but that injunction is set to expire on July 1, 2023. 

An important dates guidance can be found here. Moreover, a list of previous implementation dates and the upcoming deadline of January 1, 2024, after which producers and distributors are required...

The Retail Rundown: Memorial Day Outlook; Assessing Proposition 12

Circulars are promoting snacks, beverages, and various protein items ahead of the approaching Memorial Day holiday—the first major retail event of the year. While burgers and hot dogs are popular choices for the holiday, other grilling items boast competitive prices this year. 

Wholesale beef prices, which have come under pressure as of late but remain at the third highest levels for the current period, may influence feature volume and retail prices this Memorial Day.

Seafood features make up 35.1% of buying opportunities this week, overtaking pork at 23.7%...

Hormel Foods Company Information About California Proposition 12

Hormel Foods has assessed Proposition 12 and Question 3, and while we are still awaiting final clarity on specific details and rules, the company is preparing to fully comply when these laws go into effect. The company’s Applegate portfolio of products already complies with Proposition 12 and Massachusetts Question 3.

Hormel Foods has confirmed that it faces no risk of material losses from compliance with Proposition 12 and Question 3. While these measures will add complexity to our supply chain, including costs associated with compliance, California and Massachusetts are important markets for...

What's Next for Massachusetts Question 3 Following Prop 12 Ruling?

The future of a Massachusetts state law called Question 3 (Q3), a 2016 ballot initiative originally set to go into effect last summer, remains in the balance now that Proposition 12 has been upheld. 

Last week, the U.S. Supreme Court backed California's Proposition 12 in a 5-4 decision. Proposition 12 requires veal calves, breeding pigs, and egg-laying hens to be housed in systems that comply with specific housing standards.

Question 3 is similar to California’s Proposition 12 and would ban any uncooked whole pork sold in the state that...

Proposition 12 Has Been Upheld — What We Know So Far

Following several years of contention, the U.S. Supreme Court ruled to uphold Proposition 12 on May 11, 2023. Proposition 12 is a California law that sets animal-welfare standards for meat sold within the state. Click here for the ruling.

Below is a fact sheet on Proposition 12 as it pertains to pork and hogs compiled by Urner Barry's market reporters. Urner Barry will continue to monitor the situation and will provide updates when possible.

Quick Facts:

• California defines “confined in a cruel manner” as a breeding pig with less than 24 Sq ft of room
  • California represents ~12-13% of US pork demand
  • There were only six farms in CA in 2017 that sold more than 5000 hogs...

Industry Reaction to Supreme Court's Proposition 12 Backing

On May 11, 2023, the U.S. Supreme Court backed California's Proposition 12 in a 5-4 decision. The law was first approved by California voters in 2018. Proposition 12 requires veal calves, breeding pigs, and egg-laying hens to be housed in systems that comply with specific housing standards.

Click here for a fact sheet on Proposition 12 as it pertains to pork and hogs compiled by Urner Barry's market reporters.

Last summer, the National Pork Producers Council (NPPC) and the American Farm Bureau Federation (AFBF) argued that Proposition 12 was unconstitutional...

Smithfield Foods To Cease Operations at Farmer John Plant This Month

Smithfield Foods, Inc. is ceasing all harvest and processing operations at its Farmer John processing plant in Vernon, California this month.

According to a statement issued by the company during the summer of 2022, the decision was made due to “the escalating cost of doing business in California”. As a result of the closure, the company will reduce its sow herd located in Utah and is “exploring strategic options to exit its farms in Arizona and California”. 

The Vernon plant processed only company-owned hogs. Industry sources estimated the facility's daily processing capacity at roughly 8,000 to 10,000 head...