Ultrasonic irradiation of a slurry of deuterium-loaded palladium powder (1 µm) suspended in heavy water causes cavitation and high-speed collisions between the palladium particles. High local temperatures, estimated at above the melting point of palladium (1828 K), cause melting and interparticle fusion. The expectation that such collisions can induce high stresses within the palladium particles and lead to favorable conditions for nuclear cold fusion of the deuterium atoms within the palladium lattice is checked by measuring the neutron rates during ultrasonic irradiation. Several bursts of neutron counting are observed and can be accounted for as background anomalism, although the highest observed neutron rate is about four times the background and cannot be explained as background. The X-ray photoelectron spectroscopy analysis of the deuterium-loaded palladium powders reveals that after ultrasonic irradiation in heavy water, the palladium powder becomes partially oxidized and undergoes some compositional changes.