Evening Report | Bullish Hogs & Pigs Report

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H&P Report: U.S. hog herd unexpectedly contracts... USDA estimated the U.S. hog herd at 74.512 million head as of March 1, down 179,000 head (0.2%) from year-ago, whereas traders expected a 1.2% increase. The breeding herd at 5.980 million head declined 0.6%. The market hog inventory at 68.532 million head dropped 144,000 head (0.2%).

The winter pig crop declined 55,000 head (0.2%), as a 1.3% drop in farrowings was only partially offset by a record 11.65 pigs saved per litter, up 1.0% from year-ago.

Looking forward, producers intend to farrow slightly fewer sows during spring (-0.2%) and summer (-0.8%). But if pigs per litter continue to run at a record clip, that could end up in pig crops close to or above year-ago levels.

Based on the market hog inventory, slaughter will run fractionally below year-ago through spring and early summer.

Given that every category in the report was below the average pre-report estimates, the
data is bullish, especially with unexpected contraction.

Rollins backs Kennedy’s bird flu strategy — with a twist... USDA Secretary Brooke Rollins said she supports Health and Human Services Secretary Robert F. Kennedy Jr.’s broader approach to tackling the highly pathogenic avian influenza outbreak — even as the two appear divided on a key issue: poultry vaccination. Responding to a question from Politico at the White House, Rollins said she agrees with Kennedy’s “all-encompassing” strategy, despite his controversial claim that vaccinating poultry could create “mutation factories.” That’s a sharp contrast to her own five-point plan, which includes a $100 million investment in vaccine research. “Secretary Kennedy’s approach, and I agree with it, is we’ve got to think about this in an all-encompassing approach, with the NIH, CDC, USDA and HHS,” Rollins said. “So we are moving forward together.”
Still, some Democrats aren’t on board. Party members who’ve pushed hard for the administration to adopt poultry vaccination as a serious tool criticized Kennedy’s remarks, arguing they undermine efforts to contain the virus more proactively.

WSJ Commentary: Subsidies and smart investments — not tariffs — key to U.S. industrial growth... The Trump administration’s tariffs may sound like a pro-worker, pro-manufacturing strategy — but don’t expect them to bring about a large-scale return of American factory jobs. Instead, targeted government investment is already showing results, write Jared Bernstein & Dean Baker in an opinion item in the Wall Street Journal (WSJ). Bernstein served as chairman of the U.S. Council of Economic Advisers (2023–25). Baker is co-founder of the Center for Economic and Policy Research. Highlights of their commentary:

Tariffs Won’t Bring Back Factory Jobs. Despite promises from Trump officials, especially VP JD Vance’s recent vow to “penalize” companies that build overseas, the evidence doesn’t support the notion that tariffs lead to reindustrialization. “Even countries with large trade surpluses have experienced declining shares of factory jobs.”

Tariffs = Economic Pain, Not Gain. Markets drop with each new tariff announcement and consumer sentiment is down sharply. “Consumer economic sentiment recently hit a 29-month low… the largest decline since the pandemic.”

Trade Wars Backfire. Tariffs hurt both imports and exports and make U.S. goods less competitive abroad by raising the dollar’s value. “During the trade war in the first Trump term, the trade deficit... stayed around 3%, about where it is now.”

Many Imports Fuel U.S. Manufacturing. About 45% of imports are actually inputs for U.S. production. Tariffs on these goods make U.S. manufacturing more expensive. “Why have American car manufacturers pleaded with the administration not to impose tariffs on steel?”

What Does Work: Strategic Investment. The authors argue that boosting domestic production — particularly for clean energy and semiconductors — requires smart public investment, not punitive trade policy. Tax credits, subsidized loans, and grants from the Inflation Reduction Act, CHIPS Act, and Bipartisan Infrastructure Law are already fueling a manufacturing surge. “Factory construction more than doubled from 2019 to 2024 after adjusting for inflation.”

Bottom line: Tariffs might satisfy a political narrative, but they won’t drive a manufacturing boom. Real progress lies in targeted support for future-facing industries. “We know of no example in the history of advanced economies of sweeping tariffs having the positive effects the Trump team believes.”

Industry groups warn proposed fees on Chinese ships could hurt U.S. economy... More than 300 industry associations urged the U.S. Trade Representative (USTR) to drop proposed fees on Chinese ships, warning they would harm American businesses, consumers and port communities. In a letter sent to USTR Ambassador Jamieson Greer, the groups argued that while they support scrutiny of China’s maritime dominance, the proposed charges — up to $1.5 million per ship entry — would drive up shipping costs by 25%, add $30 billion in annual expenses and worsen the U.S. trade deficit. USTR’s proposal stems from a Section 301 investigation into China’s dominance in the maritime, logistics, and shipbuilding sectors. It cites concerns over China’s market control, including 95% of global shipping container production and more than 50% of shipbuilding output.
The letter, timed with public hearings this week, warned the fees would reduce ocean carrier service to U.S. ports — especially smaller ones — shifting traffic to Canada and Mexico, disrupting supply chains and increasing congestion. Critics also said the proposal overlooks the limited capacity of the U.S. shipbuilding industry, which cannot be revitalized within the proposed timeline.

EPA nominee vows clarity on wetlands, PFAS rules amid regulatory shift... President Trump’s nominee to lead EPA’s Office of Water, Jessica Kramer, told senators Wednesday that a forthcoming rulemaking will clarify key terms from the Supreme Court’s 2023 Sackett v. EPA decision. The rule is expected to define what constitutes “relatively permanent” wetlands with a “continuous surface connection” to navigable waters — criteria the Court set for federal protection under the Clean Water Act but left vague. Kramer said the update should help property owners identify whether wetlands on their land qualify as Waters of the U.S. (WOTUS). She also noted the agency will reexamine if ditches should be covered and confirmed PFAS regulations remain a moving target.

CBO warns of potential U.S. debt default by August... The Congressional Budget Office (CBO) has cautioned the federal government may exhaust its ability to pay bills on time by August or September unless Congress raises or suspends the $36.1 trillion debt limit. The Treasury Department has been using extraordinary accounting measures since Jan. 21 to avoid breaching the ceiling but has not provided specific guidance on when these measures will run out.

House Republicans aim to tie a debt-limit increase to extending President Trump’s 2017 tax cuts, while Senate Republicans consider addressing the issue through reconciliation without Democratic support.

Other estimates, including from the Bipartisan Policy Center, suggest the “X-date” for default could arrive as early as mid-July or as late as October, depending on tax revenue and fiscal obligations. Failure to act before the X-date would lead to defaulting on some obligations, which could disrupt financial markets and harm the economy. Treasury Secretary Scott Bessent has pledged to avoid default during his tenure.