Today, hog prices warmed up, and the market changed dramatically by 180°; prices finally stopped falling, with the market showing signs of bottoming out and recovering! This time, hog prices fell more than expected, with standard hogs quoted at 9.79 yuan/kg, hitting a new low in nearly 4 months. The traditional “Golden September and Silver October” peak season has clearly failed to deliver. Now hog prices have “suddenly surged,” and market sentiment is gradually warming. So, can hog prices rebound sharply after overshooting to the downside? Here is a detailed analysis:
As of the 18th day of month 10, statistics for 28 key monitored regions nationwide, covering 7 production regions in the north and south, show an average hog farm-gate price of 9.81 yuan/kg, up 0.02 yuan from yesterday! However, the price is still down 4.4 mao/kg from the start of the month. The live hog market remains at the bottom of its price range. In particular, prices are down 12.72% year on year and remain relatively low for the same period in nearly 5 years!
By region, hog prices across the northern and southern domestic markets are generally steady to firm! The average farm-gate price for live hogs is close to Jiangxi’s 9.75 yuan/kg, with prices in the north and south ranging from 9 to 11.2 yuan/kg. Prices rose by 0.05 to 0.15 yuan/kg in Shandong, Anhui, Jiangzhe, Shanghai, Inner Mongolia, Heilongjiang, Jilin, and Shaanxi. On the downside, prices fell by 0.05 yuan in Jiangxi and Hunan. Hog prices were generally stable across most northern and southern regions, with the market moving sideways amid fluctuations!
Turning to demand, in major domestic consumer cities, the weekend began with white-strip pork quotations in Beijing down 0.1 yuan. Feedback on pork trading was average, while white-strip pork in the Shanghai market was quoted at 12.6 yuan/kg, and sales were moving at an average pace! At present, feedback on pork consumption is subdued. Although domestic demand improved slightly as the weekend began, pork consumption remains in a “lull” for the time being!
On the one hand, after the National Day holiday, students returned to school and factories resumed operations, keeping fixed demand for pork stable. However, as tourism consumption cooled and the concentrated movement of people came to an end, demand from urban group dining and catering also weakened! In the domestic retail market, pork trading at rural markets was average. With changes in dietary patterns and ample supplies of substitute products, fresh pork carcasses are selling slowly. In particular, industry data show that as of this week, domestic frozen pork inventories stood at 31.87%; frozen pork is gradually being released from cold storage, further suppressing sales of fresh pork!
On the other hand, average live hog shipment weights rose. This week, the average shipment weight increased to 124.33 kg, up 0.42 kg from last week. After the National Day holiday, shipments of medium and large hogs that had built up earlier increased, leaving the market with ample pork supplies. This week, the average slaughter weight rose to 93.78 kg, an increase of 0.22 kg, further strengthening pork supply and demand!
On the supply side, across northern and southern China, yesterday, large-scale pig enterprises reduced the number of hogs released in many areas of the Northwest, Central China, and Northeast China, while releases increased in the Southwest! In terms of purchases by slaughterhouses, the pace of hog procurement was generally steady in both northern and southern regions, and procurement was neither especially easy nor especially difficult. Although some leading pig enterprises reduced their hog releases, demand was not strong enough to absorb the supply. In addition, the risk of disease at pig farms has increased in some areas, while independent farms are still willing to sell!
Based on this analysis, the domestic live-hog market is currently at an impasse, with both bullish and bearish sentiment. In the short term, hog prices are unlikely to surge after falling excessively, and the market may remain subdued. In the latter part of 10月, any rise in hog prices may fall short of expectations! I will also continue to track market changes, especially changes in hog releases by large-scale pig enterprises and in slaughterhouse operating rates!
However, the mainstream view is that hog prices will continue to recover gradually in the fourth quarter. After all, temperatures are gradually falling, seasonal demand is gradually improving, and pressure on the supply side may gradually ease! However, taking into account the outlook for the supply of live hogs and pork, price gains may be limited during the traditional peak season for curing and preserving meat!
As of the 18th day of month 10, statistics for 28 key monitored regions nationwide, covering 7 production regions in the north and south, show an average hog farm-gate price of 9.81 yuan/kg, up 0.02 yuan from yesterday! However, the price is still down 4.4 mao/kg from the start of the month. The live hog market remains at the bottom of its price range. In particular, prices are down 12.72% year on year and remain relatively low for the same period in nearly 5 years!
By region, hog prices across the northern and southern domestic markets are generally steady to firm! The average farm-gate price for live hogs is close to Jiangxi’s 9.75 yuan/kg, with prices in the north and south ranging from 9 to 11.2 yuan/kg. Prices rose by 0.05 to 0.15 yuan/kg in Shandong, Anhui, Jiangzhe, Shanghai, Inner Mongolia, Heilongjiang, Jilin, and Shaanxi. On the downside, prices fell by 0.05 yuan in Jiangxi and Hunan. Hog prices were generally stable across most northern and southern regions, with the market moving sideways amid fluctuations!
Turning to demand, in major domestic consumer cities, the weekend began with white-strip pork quotations in Beijing down 0.1 yuan. Feedback on pork trading was average, while white-strip pork in the Shanghai market was quoted at 12.6 yuan/kg, and sales were moving at an average pace! At present, feedback on pork consumption is subdued. Although domestic demand improved slightly as the weekend began, pork consumption remains in a “lull” for the time being!
On the one hand, after the National Day holiday, students returned to school and factories resumed operations, keeping fixed demand for pork stable. However, as tourism consumption cooled and the concentrated movement of people came to an end, demand from urban group dining and catering also weakened! In the domestic retail market, pork trading at rural markets was average. With changes in dietary patterns and ample supplies of substitute products, fresh pork carcasses are selling slowly. In particular, industry data show that as of this week, domestic frozen pork inventories stood at 31.87%; frozen pork is gradually being released from cold storage, further suppressing sales of fresh pork!
On the other hand, average live hog shipment weights rose. This week, the average shipment weight increased to 124.33 kg, up 0.42 kg from last week. After the National Day holiday, shipments of medium and large hogs that had built up earlier increased, leaving the market with ample pork supplies. This week, the average slaughter weight rose to 93.78 kg, an increase of 0.22 kg, further strengthening pork supply and demand!
On the supply side, across northern and southern China, yesterday, large-scale pig enterprises reduced the number of hogs released in many areas of the Northwest, Central China, and Northeast China, while releases increased in the Southwest! In terms of purchases by slaughterhouses, the pace of hog procurement was generally steady in both northern and southern regions, and procurement was neither especially easy nor especially difficult. Although some leading pig enterprises reduced their hog releases, demand was not strong enough to absorb the supply. In addition, the risk of disease at pig farms has increased in some areas, while independent farms are still willing to sell!
Based on this analysis, the domestic live-hog market is currently at an impasse, with both bullish and bearish sentiment. In the short term, hog prices are unlikely to surge after falling excessively, and the market may remain subdued. In the latter part of 10月, any rise in hog prices may fall short of expectations! I will also continue to track market changes, especially changes in hog releases by large-scale pig enterprises and in slaughterhouse operating rates!
However, the mainstream view is that hog prices will continue to recover gradually in the fourth quarter. After all, temperatures are gradually falling, seasonal demand is gradually improving, and pressure on the supply side may gradually ease! However, taking into account the outlook for the supply of live hogs and pork, price gains may be limited during the traditional peak season for curing and preserving meat!