The pools hold a swill of cheaper, locally sourced ingredients, which can include brans, pumpkin vines and wine lees. But it is fermented – like yogurt – so the proteins are already broken down and easy to digest, lessening the need for the higher-quality proteins in soy, 80 per cent of which China imports.

For the farm’s owner, 47-year-old Gao Qinshan, the motivation is entirely monetary. Feed accounts for 70 per cent of pig rearing costs, and soybean prices have jumped – squeezed by Beijing’s trade stand‑off with Washington and compounded by war in the Middle East.

“Soybean prices have become so unstable,” Gao lamented.

With the industry already hobbled by oversupply and weak consumer demand, “pig farming has become unprofitable,” he said. “Everyone is thinking about how to cut costs.”

Beijing moves to deploy new feed, technology

The grassroots fixation on overheads belies Beijing’s more strategic motivations: long‑term food security and increased self‑reliance.

The government sharply accelerated a drive to expand protein sources for livestock in March of last year, just as trade tensions ramped up early into President Donald Trump’s second term. Soybeans quickly became a key bargaining chip.

Reuters interviews with dozens of livestock and feed producers, state researchers and industry experts revealed Beijing is moving faster than previously thought to deploy new technologies and promote fermented feed.

It’s the agricultural equivalent of Beijing’s campaign to build domestic capabilities in microchips and artificial intelligence, catalyzed by Washington’s stringent controls on advanced technology exports to China.

In terms of agriculture, “the biggest national policy goal right now is soymeal reduction,” said Fu Zhenzhen, a feed analyst at Beijing Orient Agribusiness Consultants.

“The most direct reason for that is the trade war with the United States,” she said. “Fermentation is essential.”

Motivating farmers to switch

China is the world’s biggest buyer of soybeans, and imported $52.7 billion (C$73.3 billion) of the oilseed in 2024, $12 billion of which came from the U.S., the latest figures from the World Bank show.

Last year, inbound shipments increased 6.5 per cent from 2024 to a record 111.8 million metric tons, according to Chinese customs data.

Fermented feed currently accounts for eight per cent of industrial feed in China, up from three per cent in 2022, and is likely to hit 15 per cent by 2030, industry experts predict. That could help China cut soybean imports by up to 6.3 per cent from last year’s levels, according to Reuters calculations.

Pig farmers are just one piece of Beijing’s food security puzzle, albeit an important one, with pork a traditional staple of the Chinese diet — China is home to half the world’s pigs — and swine more dependent on soymeal than poultry or cattle.

Farms like Gao’s raise a third of livestock in China, the world’s biggest meat producer.

However, the switch to fermented feed requires a heavy commitment, often entailing the overhaul of entire feeding systems. Gao struggled initially, with feed growing mould and going to waste. Many farmers simply give up.

Beijing, characteristically, is leaving nothing to chance, offering incentives to every sector of the industry, and every link in the supply chain.

Targeting the entire supply chain

China’s Muyuan Foods, the world’s biggest pig farmer, has reduced soymeal in its feed from 10 per cent six years ago to 7.3 per cent now by using synthetic amino acids produced from fermented corn starch, Zhang Meng, director of the company’s feed division, told Reuters.

Agribusiness giant New Hope has developed soymeal-free chicken and duck feeds by fermenting duckweed and other cheap protein sources, according to people familiar with the matter. New Hope did not reply to a Reuters request for comment.

Working with the government, China’s two biggest dairy producers, Yili and Mengniu, have cut the amount of soymeal in cattle feed by 20 per cent, according to sources at the state-backed National Center of Technology Innovation for Dairy. Yili declined to comment, and Mengniu did not reply to a request for comment.

All of the figures on soymeal reduction are being reported for the first time.

China has also attracted foreign investment, with Dutch-based trading house Louis Dreyfus planning to build its first fermented feed production line in the northern port city of Tianjin.

“China is standing at the forefront of fermentation technology,” said Shambhu Nath Jha, principal consultant at Fact.MR.

The U.S.-headquartered consultancy estimates that the value of China’s fermented feed market vaulted to $6 billion (C$8.3 billion) last year, catching up fast on Europe’s leading but more mature market, worth $7 billion. The U.S. market, by contrast, is worth just $2.5 billion, because soybeans and corn are more readily available.

For poultry, China’s 25 per cent fermented feed adoption rate already surpasses Europe’s 20 per cent, according to Fact.MR.

Costs, complexity and taste

Beijing has momentum on its side: Pork prices at 16-year lows make any cost-reduction scheme an easy sell.

Where the fermentation pitch runs into problems is the lack of a standardized approach, analysts said.

Some argue that pigs mature more slowly if farmers simply ferment whatever food sources are available, and can be weaker to disease.

The ultimate test may be taste.

“There is so much demand from consumers for better quality meat, but the industry is just focused on reducing costs and doing what the government wants,” said Ian Lahiffe, an agriculture consultant in Beijing.

“There are a lot of benefits to feeding soybeans,” he said. “They need to think about how to avoid sacrificing animal health and meat flavour.”

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The case is part of broader scrutiny in the U.S. over so-called right-to-repair practices, with regulators and plaintiffs arguing that some manufacturers limit competition by controlling access to repair tools and software.

What does the settlement cover?

The settlement fund covers eligible plaintiffs who paid Deere’s authorized dealers for repairs to large agricultural equipment from January 2018, according to a document filed on Monday in the federal court in Chicago, Illinois.

In the settlement, Deere also agreed to make available to farmers for 10 years “the digital tools required for the maintenance, diagnosis, and repair” of large agricultural equipment, including tractors, combines, and sugarcane harvesters, the filing showed.

The proposed accord requires a judge’s approval.

“This settlement addresses the issues raised in the 2022 complaint and brings this case to an end with no finding of wrongdoing,” Deere said in a separate statement.

Deere faces FTC suit

Deere also faces a separate lawsuit brought by the U.S. Federal Trade Commission. A U.S. judge ruled in 2025 that Deere must face that lawsuit, which accused the company of forcing farmers to use its authorized dealer network and driving up their costs for parts and repairs.

Deere is blocking farmers from acquiring the “tools and information necessary to repair their equipment in a timely and cost-effective manner,” the FTC had said in a court filing in April. Deere has denied the wrongdoing.

— Reporting by Carlos Méndez, Mrinmay Dey in Mexico City and Mike Scarcella in Washington

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WHY IT MATTERS: Analysts said the April 5 attack on the ship added to risks to global food security and agricultural trade stemming from the ongoing U.S.-Israeli war against Iran.

Russian media said the vessel was carrying wheat from the Port of Azov, near the city of Rostov, to Port Kavkaz in the strait separating the Crimean peninsula from mainland Russia, where the grain is usually loaded onto larger vessels for export.

TASS quoted emergency services as saying the vessel, which was gutted by fire and began to sink, was towed to the village of Kuchugury in Russia’s Krasnodar region. A video posted by the news agency showed the vessel engulfed in flames and smoke. The agency said two badly burned bodies were found aboard the ship, bringing the death toll to three. An aide to the vessel’s captain had earlier been reported dead.

Public ship databases list Volgo-Balt 138-class vessels at about 3,165 tons deadweight.

Grain consultancy Sovecon earlier described the incident as the first known sinking of a grain-loaded ship in the Black Sea-Azov basin, a major grain-trading route, since the start of the war in Ukraine in 2022.

“Against the backdrop of Iran’s conflict and the effective paralysis of diplomacy among Washington, Moscow and Kyiv, the risk of further escalation in the region appears to have increased significantly,” Sovecon head Andrey Sizov said.

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Beef prices set records this year after the nation’s cattle supply dropped to a 75-year low, leading to record prices for meatpackers such as JBS to buy cattle to slaughter, despite benefiting from the climbing prices.

WHY IT MATTERS: The strike at JBS’s Greely, Colorado site has weighed, somewhat, on U.S. beef prices.

The union representing about 3,800 plant workers said the new round of talks would resume on April 9 and 10 after last month’s strike to press for wages that reflect inflation and a halt to company charges for replacing protective equipment.

“Workers remain united and will continue to fight until JBS fully ends its unfair labor practices,” said Kim Cordova, president of the local union representing the Greeley workers.

It is calling for a contract offer that protects workers, shows them the respect they deserve, and pays them a livable wage, he added in a statement.

There had been no new deal or change to the original offer, a JBS spokesperson told Reuters.

“We are pleased to welcome our team members back and are preparing to resume and ramp up operations at the Greeley plant next week,” the spokesperson added in an email.

The strike dealt a blow to U.S. processing capacity, after Tyson Foods closed a beef plant in Nebraska this year and reduced operations at a Texas facility.

The dispute with the workers, represented by the United Food and Commercial Workers Local 7 union, comes as meatpackers typically seek to boost efficiency by running plants at peak capacity to offset hefty running costs.

— Reporting by Gnaneshwar Rajan and Chandni Shah in Bengaluru

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Finance Minister François-Philippe Champagne, who met with Chinese Vice Premier He Lifeng, told reporters he also discussed the impact of geopolitical tensions on the oil and gas market and how China sees Canada as a stable energy supplier.

“We are becoming a partner of choice,” he said.

WHY IT MATTERS: While China has lowered levies on Canadian agricultural products like canola, it continues to charge a 25 per cent tariff on Canadian pork.

The two officials also agreed to hold high-level economic and financial dialogue in the second half of this year, according to an official Chinese summary of the meeting.

Champagne said the discussions centred on the financial services sector but addressed trade in energy and pork, as well as fair labour practices.

“Canada puts a lot of importance on supply chain integrity and that our bilateral trade needs to be conducted in accordance with international standards,” Champagne said.

Canada, like China, has been targeted with tariffs by U.S. President Donald Trump since his administration took office in January 2025. Strained U.S. trade relations have posed a major challenge for the Canadian economy.

Among the Trump administration’s actions, the U.S. Trade Representative’s office in March said it initiated a second set of unfair trade practice probes of 60 economies, including Canada and China.

Tariffs on Canadian pork discussed

China is Canada’s second-largest trade partner with about C$120 billion of bilateral trade. Canada aims to increase its overall exports to China by 50 per cent by 2030.

Prime Minister Mark Carney met with Chinese President Xi Jinping in January as Ottawa works to diversify trade away from its largest partner, the United States.

While China suspended some agricultural levies on Canada following Carney’s visit, Beijing still has a 25 per cent tariff on imports of Canadian pork, which Champagne said he raised during the meetings.

“Part of my message to the Chinese side was, really, we need to get to a point where we remove these trade irritants,” he said. “I’m leaving Beijing tomorrow with the feeling that we have laid the foundation.”

Champagne added that the automotive sector was not discussed, following reports that Stellantis was reviewing options for building electric vehicles in Canada with Chinese partner Zhejiang Leapmotor Technology.

He said Stellantis would need to live up to its obligations on investments and workers in Canada.

— Additional reporting from Reuters’ Beijing newsroom

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Planting of wheat, canola and other crops is set to gather pace this month across much of Australia and farmers need ample supplies of crop nutrients to support early growth.

The price of urea in Australia was quoted around A$1,350 (C$1,298) per ton this week, up about 60 per cent since the beginning of the U.S.-Israeli war with Iran, analysts said. Australian diesel prices are up 88 per cent over the same period.

“Farmers are trying to reduce fertilizer application and switching planting from nitrogen hungry crops like wheat and canola into feed barley,” said Dennis Voznesenski, an agricultural analyst at Commonwealth Bank of Australia.

“Some are also reducing planted area, but this so far is minimal,” he said.

Australia’s wheat planting could drop by 10 per cent to 12 per cent given the current conditions, from 12.4 million hectares a year ago, an agricultural broker and an analyst said. Cultivation of canola is also likely to decline despite higher returns, they said. Both declined to be named.

Australia is the world’s fourth-largest wheat exporter and No. 2 supplier of canola, selling to importers across Asia, the Middle East and Europe. It also sells crops such as barley, chickpeas and pulses.

Straight of Hormuz is fertilizer choke point

Farmers worldwide are struggling to secure fertilizer supplies as planting season in key countries gets underway, with the Strait of Hormuz, which carries 30 per cent of globally traded fertilizers, severely disrupted by the Iran war.

Bank of America warned that the conflict threatens 65 per cent to 70 per cent of global supplies of urea, a key nitrogen fertilizer, with prices already up 30 per cent to 40 per cent.

U.S. farmers plan to plant less corn and more soybeans in 2026 than last year, the U.S. Department of Agriculture said this week. China has curbed fertilizer exports, while India is tapping alternative sources to boost supplies for summer-sown crops.

Corn, wheat and canola usually require higher application of urea than barley and pulses.

“Australia typically relies on China for urea, but export curbs have limited shipments,” said StoneX analyst Josh Linville.

“Buyers turned to Indonesia, only to face further constraints there and by the time they sought supplies from the Middle East, the war had already started and the Strait of Hormuz had closed.”

Crops need fertilizer at the start of planting as well as in development and pre-maturity stages. Crops planted in April and May are harvested in November and December.

“It is a big issue as the cost of farming has risen sharply in the last one month,” said Tobin Gorey, founder of commodities consultancy Cornucopia in Sydney.

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Shares of Hellmann’s mayonnaise owner Unilever and Frank’s RedHot sauce maker McCormick fell on Tuesday following the announcement over concerns about the transaction’s structure, long path to closing and antitrust risks.

The top U.S. spice maker, home to more than 30 household brands, is playing the long game, some analysts said.

While many food companies are scrambling to reformulate products and resize portions as the surging popularity of GLP-1 weight-loss drugs reshapes eating habits, McCormick argues that flavor will remain essential even as calorie counts fall.

“We will continue to flavor calories while others compete for them,” McCormick CEO Brendan Foley, a packaged-food industry veteran, said on a call with investors on Tuesday.

“As consumers increasingly focus on cooking at home, adding more protein and produce, and pursuing healthier lifestyles, flavor plays a critical role in elevating those choices,” Foley said.

The GLP-1 bet

The surge in weight-loss drug use has consumers craving more flavor ‌in their food, leading to condiment and spice makers benefiting and attracting more interest in the M&A marketplace, dealmakers have said.

“Consumers shifting away from fatty, greasy, or overly sweet foods … creates a massive opportunity for flavor enhancers (spices and hot sauces) that provide sensory satisfaction without adding calories,” said Timothy Malefyt, professor of marketing at the Gabelli School of Business at Fordham University.

The deal will also help the U.S. company tap into Knorr stock cubes maker Unilever’s global scale and expertise, executives said on Tuesday’s investor call. Unilever executives highlighted its popular flavors such as Asian and Chinese.

“McCormick with this could be well-positioned to create the right nutritional functional benefit in food that is lacking in America right now,” said Mike Anstey, founder of Pilot Lite, a global CPG (consumer packaged goods) commercialization partner.

It would also open up key emerging markets such as Brazil, China and countries across Europe, the Middle East and Africa (EMEA).

“(The deal) represents a step-change in scale, broadening MKC’s exposure to faster-growing emerging markets and expanding opportunities for its foodservice platform,” Jefferies analyst Scott Marks said in a note.

Unkind market conditions

McCormick is seeking new markets and flavors against the backdrop of a tough U.S. market, where consumers are eating healthier and also looking for cheaper pantry alternatives and smaller pack sizes to stretch budgets hit by inflation.

“We’re certainly aware of the near-term pressures facing not just the food industry but broadly … the conflict in the Middle East and the broader CPG space. However, we continue to believe in just the long-term fundamentals that really underpin the confidence in this combination,” McCormick’s Foley said.

The company’s total volume growth has slowed over the last year, and was down 0.7 per cent in the most recently reported quarter, falling across both its consumer brands and flavor solutions segments.

“Despite the combination’s strategic merits, we think this may be a ploy to incite growth in an industry where gains have stagnated,” said Erin Lash, analyst at Morningstar Research.

Rival Kraft Heinz, which media reports said had explored a bid for Unilever’s food business, underscored the tougher U.S. market when it paused plans for a split.

“Investors should look at this transaction more optimistically than broken deals like Kraft Heinz because it creates value through greater depth in a single category, flavorings, rather than diversification,” said TD Cowen analyst Robert Moskow in a note.

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The moratorium, agreed at the dawn of the internet, lapsed for the first time in 28 years after World Trade Organization countries failed to agree on a routine extension.

Four days of talks among trade ministers in Cameroon’s capital Yaounde broke up in the early hours of Monday with Brazil and Turkey blocking a bid to extend the e-commerce moratorium, which including on digital downloads and streaming.

Countries also failed to agree on a path to reform.

U.S. Trade Representative Jamieson Greer said in a statement that he has secured agreements from dozens of countries, including nearly all major trading partners, not to impose tariffs on U.S. digital transmissions. He vowed that if the WTO fails to restore the moratorium, “the United States will work outside of the WTO with all interested partners to get it done.”

Greer, who is the architect of U.S. President Donald Trump’s multi-front tariff assault on global trading partners, said he was disappointed that the meeting ended in an impasse. He said some countries demonstrated a “lack of seriousness” in WTO reform by not sending their trade ministers to Cameroon.

“I have always been skeptical of the value of the WTO, and this week’s conference confirmed that this organization will play only a limited role in future global trade policy efforts,” Greer said.

Increasingly sidelined by economic nationalism

The WTO has been increasingly sidelined by economic nationalism in the past decade, and its 14th ministerial conference in Cameroon will further that trend, analysts said.

The talks tested the WTO’s relevance after a year of huge trade turmoil and more recent disruptions in the Middle East.

Still, a subset of 66 members did agree to sidestep previous hurdles to ‌usher in the world’s first baseline deal on digital trade rules among participants.

The parties of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership — 12 countries including Australia, Britain, Canada, Japanand Mexico but not the U.S. — met with the EU on the sidelines of the WTO talks.

As diplomats pursue a mix of agreements between two or larger subsets of countries, they risk creating a complex “spaghetti bowl” of agreements, said Dmitry Grozoubinski, executive director of the Geneva Trade Platform.

WTO Director-General Ngozi Okonjo-Iweala said the trade body hoped the moratorium could still be restored, adding that Brazil and the U.S. were trying to reach agreement on it.

— Additional reporting by Emma Farge in Geneva and Lisandra Paraguassu in Brasilia and David Lawder in Washington, D.C.

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The four-day ministerial talks in Cameroon’s capital Yaounde ended in the early hours with Brazil blocking a bid by the U.S. and others to prolong a moratorium on duties for electronic transmissions like digital downloads and streaming.

“It marks another crack in the foundations of the WTO system,” said Andrew Wilson, Deputy Secretary General of the International Chamber of Commerce, urging delegates to renew the moratorium before states hit digital services with new charges.

‘Major setback for global trade’

Expectations for progress had been low before the talks but there were hopes the moratorium – which has been regularly renewed since 1998 – would at least be extended.

That ultimately proved impossible. Trade ministers could not agree to extend it for more than two years, which was not enough for the United States, diplomats said.

U.S. officials and business groups voiced frustration, and Britain’s Business and Trade Secretary Peter Kyle called the failure to reach consensus a “major setback for global trade.”

The talks were deemed a test of the WTO’s relevance after a year of huge trade turmoil and more recent disruptions due to the U.S.-Israeli war on Iran.Still, a subset of 66 members did agree to sidestep previous hurdles to ‌usher in the world’s first baseline deal on digital trade rules among participants.

Changes looked for

Prior to meetings, three items were expected to dominate talks wrote Jane Kelsey, an emeritus professor of law with the University of Auckland, in an article for the Conversation.

Those were:

• Decision making: reformers proposed a “responsible consensus” model rather than the current multilateral model, which gives all states an equal voice.
• Development and industrialization: this proposed to limit countries’ ability to define their own level of development, Kelsey wrote. “Special and differential treatment” would give them more time to adopt rules applied to more developed countries.
• Leveling the playing field: this was “essentially about China,” wrote Kelsey, which the U.S. says has gained an unfair advantage since joining the WTO. The U.S. wanted rules to restrict state support for industry and to limit application of “most-favoured-nation treatment.”

‘Spaghetti bowl’

Efforts to rebuild the WTO’s predictable trade terms are creating “a spaghetti bowl of free trade agreements, bilateral initiatives, and plurilaterals,” said Dmitry Grozoubinski, executive director of the Geneva Trade Platform think tank.

Agreeing on an e-commerce moratorium was seen as key to securing U.S support for the WTO, which under President Donald Trump has retreated from global multilateral bodies.

WTO Director-General Ngozi Okonjo-Iweala said the trade body hoped the moratorium could be restored and that Brazil and the U.S. were trying to reach agreement on it.

The WTO said progress was made on a reform roadmap, and discussions on issues like reworking its rules to render subsidy use more transparent and facilitate decision-making are expected to continue in Geneva.

The U.S. and the European Union argue China in particular has taken advantage of current rules to their detriment.

Impasse could boost CPTPP

Diplomats worked throughout Sunday to close the gap between Brazil’s initial two-year proposal on the moratorium and the U.S., which wanted a permanent extension, by drafting a plan for a four-year extension with a one-year sunset buffer.

Brazil then offered a four-year extension with a mid-term review clause, but it lacked sufficient support.

Keith Rockwell, a trade analyst at the Hinrich Foundation and former WTO director, said Brazil’s efforts to leverage e-commerce for concessions on agriculture had failed because the U.S. was no longer so invested in the WTO.

“In the old days because they felt responsibility for the system the Americans would have swallowed hard and taken a hit,” he said. “But now they won’t do that anymore.”

He said the impasse would boost alternative structures like the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, a trade deal encompassing 12 countries including Japan, Britain, Canada, Mexico and Australia – but not the U.S.

“Now what you’re going to see is a lot more energy and momentum into things like the CPTPP,” Rockwell said.

— Additional reporting by Emma Farge in Geneva

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“I want John Deere and Case and all of – they’re great companies, Caterpillar… I want these companies to give it to you in the form of lower tractor and equipment costs,” Trump told hundreds of farmers and ranchers gathered under drizzle at an event on the South Lawn of the White House.

Deere & Co shares dropped two per cent after the statement. Case IH manufacturer CNH Industrial fell one per cent while Caterpillar Inc was down nearly 1.2 per cent in late-session trading.

The three companies could not immediately be reached for comment.

Trump seeks support from struggling farmers

Trump called for lower prices in an aside during a speech that otherwise focused on shoring up support among the Republican president’s loyal constituency of rural voters, who have backed Trump in all three of the last presidential races.

For the fourth straight year, U.S. crop producers are facing tight margins, high production costs and low commodity prices – and are struggling financially – despite near-record government payments.

The Trump administration is distributing $12 billion (C$16.7 billion) in aid to U.S. farmers — a move that farm trade groups and agricultural economists have said is helpful in the short-term but will not fully compensate farmers for financial losses that have topped $30 billion in recent years.

On Friday, Trump said he would seek even more such aid for farmers from Congress. More than 50 farm-interest groups, such as the American Farm Bureau Federation, are urging Congress to approve additional aid in a military funding package.

Trump pledges new loan guarantees

The event happened as the administration finalized new biofuel blending mandates for U.S. oil refiners, requiring them to mix more of the fuels made from corn and other agricultural products into the nation’s gasoline and diesel than initially proposed, in an apparent win for farmers.

Trump also said the U.S. Small Business Administration would open up new loan guarantees for farmers and food suppliers.

Farmers are entering the critical spring planting season under a cloud of uncertainty as the U.S.-Israeli war with Iran disrupts global trade, causing fertilizer and diesel costs to spike.

The long-term U.S. trade relationship with China also remains unclear amid the ongoing trade war launched by Trump’s administration with the country, the world’s top soy importer.

Rural voters constitute a fifth of the U.S. electorate, and they favored Trump by a two-to-one margin over Democrat Kamala Harris in the 2024 presidential election.

— Additional reporting by Bhargav Acharya

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