Hog prices fell in 10. Although the traditional seasonal lull in demand weighed on the market, the main drivers of this downturn were continued release of capacity from earlier periods and supply pressure from rising average slaughter weights. Looking ahead to 11-12, improved industry production efficiency is offsetting the effects of earlier capacity reduction. Combined with concentrated sales of secondarily fattened hogs and livestock companies pushing to increase sales at year-end, pressure on the supply side remains. On the demand side, end-consumer pork consumption has been weak for a long time; stockpiling for the peak season for cured meats may be limited, while frozen product releases are diverting demand from fresh products, limiting the upside from the peak season. With opposing forces in supply and demand, as well as uncertainty, hog prices are likely to rise first and then fall in the period ahead.
Capacity releases and rising average weights drive the decline in hog prices in 10
Data monitored by Zhuochuang Information show that, as of 22, the national average price of lean hogs in 10 was 9.88 yuan/kg, down 7.44% month on month. Typically, the month-on-month decline in the average price in 10 is mostly due to a lack of holiday stockpiling support in 10, with hog slaughter volumes falling from 9, weighing on prices. Under current conditions, weak demand is only one contributing factor; the greater impact comes from capacity releases and rising average weights.
Approximately 10 months earlier, although the national inventory of breeding sows declined, the inventory of breeding sows at the 196 medium- and large-sized sample enterprises monitored by Zhuochuang Information still showed a slight increase, and their PSY was relatively high, so 10 was still a period of capacity release. At the same time, an increase in average trading weight encouraged farming enterprises to actively market their hogs. Zhuochuang Information monitored an average trading weight of 125.42 kg for hogs at sample enterprises on 10 22, higher than the 0.67 kg in the same period last year. Slaughtering enterprises are currently suffering heavy losses and were already relatively unmotivated to purchase hogs. The increase in average trading weight adds to pork supply pressure, further reducing slaughtering enterprises’ willingness to purchase hogs and weighing on hog prices.
Improved Production Efficiency Offsets Capacity Reduction
The theoretical hog volume available for marketing in 2026 11-12 is determined by the volume of hogs marketed in 2026 1-2. According to Zhuochuang Information data, from 2025 7 to 2026 2, the inventory of breeding sows at sample enterprises declined by a cumulative 3.95%, indicating a clear effect from capacity reduction, although the inventory remained relatively high. In terms of production efficiency, according to a Zhuochuang Information survey, the current industry average PSY is around 28, while some high-performing operations have a PSY above 30. Improvements in production efficiency can offset some of the reduction in hogs marketed resulting from capacity reduction, and supply pressure in 11-12 may still be considerable.
Pig prices fell in 9-10, attracting some producers to enter the secondary fattening market. These large pigs that have not yet been shipped to slaughter will be shipped from 11 through 1 of the following year, adding to future pressure on hog supply. Meanwhile, based on past experience, farming companies usually step up shipments at year-end to meet targets, and may increase shipments in 11-12, further adding to downward pressure on pig prices.
The increase during the peak demand season may fall short of expectations
On the one hand, hog slaughter volume reflects the level of hog supply. Increased hog supply in 11-12 may support an increase in hog slaughter volume, while demand may follow its seasonal trend. However, looking at actual consumer demand in the end market, pork demand has been declining in recent years. Influenced by factors such as changes in residents’ consumption habits, a shift in the main consumer demographic, and falling incomes, hog demand has generally fallen short of expectations. This is particularly evident in insufficient stocking by end-market buyers ahead of holidays and a year-on-year decline in demand for cured meat products. Therefore, hog demand in 11-12 may increase both passively and actively, with only limited potential to support pig prices. Meanwhile, slaughtering companies currently have a strong willingness to release frozen pork stocks, which may offset some demand for fresh pork.
In summary, taking into account factors such as restocking and marketing by secondary fattening operations, as well as pig disease risks in the fourth quarter, hog prices may rise first and then fall from 11-12; prices may rise in 11, supported by expectations for cured-meat production; and prices may fall in 12 as hogs are marketed in large numbers. The monthly average price may be between 9.8-10.1 yuan/kg.