As 10 moves into the latter half of the month, domestic livestock and poultry farming has seen the following developments. Earlier, egg prices rose more than expected. Before the Mid-Autumn Festival, egg prices for production and sales climbed to 5.36 yuan per jin, setting a new high for the year. However, as demand support weakened and pre-holiday stocking was completed, egg prices fell from their peak. In particular, after the National Day holiday, prices continued to edge down, and eggs in major producing regions have now fallen to around 3.9 yuan! As for hogs, after receiving brief support from the start of the school term in early 9 and rising to 11.09 yuan per kilogram, the hog market entered a downward trend. Although the Mid-Autumn Festival and National Day holidays followed one another, hog prices continued to retreat steadily. In particular, after the National Day holiday, hog prices quickly fell below 10 yuan per kilogram, dropping to 9.79 yuan per kilogram. The hog market has shown a “super-rational” downward trend……
Now that 10 is more than halfway over and the latter part of the month is approaching, prices have edged up slightly after the hog market briefly bottomed out, with prices for standard-weight hogs rising to 9.81 yuan! Although support at the market bottom may be further reinforced, hog prices still face multiple pressures in reality!
Positive factors: On the one hand, hog prices have retreated, with standard-weight hogs quoted at less than 5 yuan per jin. Farming losses have deepened, with the average loss per head among major self-breeding and self-raising operations exceeding 210 yuan. Losses on sales at some smallholder farms may be close to 500 yuan. Such large farming losses may encourage the market to hold prices firm. In recent days, more leading hog producers in many regions of the north and south have reduced sales volumes, and the willingness to keep hogs on farms for a moderate period has increased. Some farms in the broader market are reluctant to sell and are taking a wait-and-see approach. On the other hand, with the arrival of late autumn, temperatures in northern and southern regions may gradually fall, bringing cooler weather. This may prompt a gradual marginal recovery in demand. After the customary post-holiday slowdown in consumption, conditions may gradually improve. In addition, standard-weight hog prices are low, reducing the cost of restocking with standard-weight hogs at this stage, and the market may see some secondary fattening purchases at lower prices.
Factors weighing on the market: On the one hand, expectations for consumer demand have strengthened, but actual feedback on pork buying and selling remains subdued. In particular, domestic frozen pork inventories are high, demand in the domestic market is recovering slowly, household substitution is becoming more common, and actual consumer support is limited. On the other hand, large-scale pig farming companies are reducing sales and holding prices firm. However, in 10 month, pressure from daily hog sales by above-scale pig farming companies remains undiminished. Also, during the month, due to pig farm diseases and the accelerated culling of sows, the pace of market hog sales has been slightly slow. Downstream demand has been insufficient to absorb supply, and some pig farming companies still need to realize cash from sales!
Based on this analysis, the live hog market is currently being guided by sentiment, with changes in sales pace on the farming side. Hog prices are mainly fluctuating within a range. The prevailing view is that in the middle to latter part of 10 month, hog prices may bottom out and recover. However, given existing supply pressure, expectations for an increase may be limited! According to data monitoring and analysis, with slaughterhouses adjusting prices, the average price of standard market hogs is expected to be 9.86 yuan/kg on 10 month 19; close attention should be paid to changes in the pace of market buying and selling!