At the start of 11 month, the hog market has recently seen ample supplies of commercial pigs, as supply continues to be released at a high level. Seasonal changes have also led to more disease outbreaks at pig farms, further intensifying panic-driven sales. The hog market is seeing “a peak season that fails to peak,” with prices plunging in a “cliff-like” decline! Standard pigs are currently quoted below 9 yuan/kg nationwide, and market sentiment remains weak. So where is the “floor” for pig prices? An analysis follows:
Currently, pig prices in China’s hog market have fallen through key levels, with standard pigs quoted below 9 yuan/kg. As for culled sows, prices have recently continued to fall, with the averageprice of pigscontinuing to decline, with the average falling to around 3.2 yuan/jin. In some producing regions, the culling price for low-productivity sows is even below 2.4 yuan/jin! The price of sowsprice of pigscontinuing to weaken, further confirming the market’s willingness to reduce production capacity. In addition, demand is unable to absorb supply, and hog production capacity has entered a phase of actively accelerating its reduction!
According to data monitoring and analysis, as of now, nationwideexotic three-way crossbredlivehog prices，the average ex-farm price is 8.94 yuan/kg, down 0.07 yuan from yesterday, with the price center retreating. It is down 27.4% year over year, and prices are close to their lowest level of the year. The market has again fallen below “9 yuan/kg,” with hog prices on a “cliff-like” downward trend! Compared with the beginning of last month, hog prices have fallen by a cumulative 12.78%; compared with the beginning of 9 month, they are down 19.4%.
By region, across the key monitored areas in northern and southern China, the average ex-farm hog price is close to 8.95 yuan/kg in Anhui, Guangxi, Beijing-Tianjin, and Hebei. Hog prices in the north and south are generally 8.3~10.65 yuan/kg, with Guizhou quoting the lowest prices and Guangdong the highest. In the main hog-producing areas across the north and south, prices are 8.6~9.2 yuan/kg. The market is showing a sharper-than-expected decline!
On the supply side, during the “Golden September and Silver October” months, large corporate hog producers face substantial pressure to ship. In addition, as average hog shipping weights rise and disease risks at pig farms increase, willingness to sell is strong, with both independent producers and hogs previously held for a second-round of fattening now being shipped in concentrated volumes. However, with peak-season demand failing to materialize and consumption lacking support, large corporate producers have struggled to meet their shipping plans. Last month, large-scale hog producers planned to ship 1508.18 ten thousand head but actually shipped 1481.75 ten thousand head, completing 98.25% of their plans; some production capacity was shipped later than planned. According to data monitoring and analysis, 173 leading hog producers in the country planned to ship 11 ten thousand head in 1519.67 month, an increase of 2.56% from the previous month. Hog supply has risen significantly. In particular, with fewer shipping days this month, the average daily shipping plan may increase sharply month over month, creating substantial pressure from excess hog supply!
On the demand side, as 11 month begins, pork purchasing and sales enter their seasonal peak. However, this month, consumption lacks substantive support, particularly the boost usually provided by holidays! Urban mobility is limited, and the recovery in household demand in the domestic market is weak. Supplies of substitute products are ample, limiting support for pork demand. Moreover, as hog shipments increase month over month and average shipping weights continue to rise, the situation of excess pork supply is further exacerbated. Buyers seeking to fatten hogs for a second time lack confidence in buying the dip, and producers lack confidence in a price increase, so the market largely continues with routine shipping. In particular, long-term losses in hog finishing and rising disease risks at pig farms have further intensified panic selling among producers. Downstream slaughterhouses face little difficulty in sourcing hogs, and mainstream slaughterhouses, under pressure from losses, are inclined to use the situation to push prices down!
Based on this analysis, amid changes in supply and demand, in 11 month, the pattern of strong hog supply and weak demand may be difficult to ease, and hog prices still face the risk of continuing to seek a bottom! As for the “floor” for this round of price declines, I personally believe that hog prices may fall below the low seen in the second quarter, with standard-weight hogs possibly dropping to around 8.5 yuan/kg! Going forward, watch for changes in market trading sentiment, especially changes in the pace of sales by corporate hog producers!
Currently, pig prices in China’s hog market have fallen through key levels, with standard pigs quoted below 9 yuan/kg. As for culled sows, prices have recently continued to fall, with the averageprice of pigscontinuing to decline, with the average falling to around 3.2 yuan/jin. In some producing regions, the culling price for low-productivity sows is even below 2.4 yuan/jin! The price of sowsprice of pigscontinuing to weaken, further confirming the market’s willingness to reduce production capacity. In addition, demand is unable to absorb supply, and hog production capacity has entered a phase of actively accelerating its reduction!
According to data monitoring and analysis, as of now, nationwideexotic three-way crossbredlivehog prices，the average ex-farm price is 8.94 yuan/kg, down 0.07 yuan from yesterday, with the price center retreating. It is down 27.4% year over year, and prices are close to their lowest level of the year. The market has again fallen below “9 yuan/kg,” with hog prices on a “cliff-like” downward trend! Compared with the beginning of last month, hog prices have fallen by a cumulative 12.78%; compared with the beginning of 9 month, they are down 19.4%.
By region, across the key monitored areas in northern and southern China, the average ex-farm hog price is close to 8.95 yuan/kg in Anhui, Guangxi, Beijing-Tianjin, and Hebei. Hog prices in the north and south are generally 8.3~10.65 yuan/kg, with Guizhou quoting the lowest prices and Guangdong the highest. In the main hog-producing areas across the north and south, prices are 8.6~9.2 yuan/kg. The market is showing a sharper-than-expected decline!
On the supply side, during the “Golden September and Silver October” months, large corporate hog producers face substantial pressure to ship. In addition, as average hog shipping weights rise and disease risks at pig farms increase, willingness to sell is strong, with both independent producers and hogs previously held for a second-round of fattening now being shipped in concentrated volumes. However, with peak-season demand failing to materialize and consumption lacking support, large corporate producers have struggled to meet their shipping plans. Last month, large-scale hog producers planned to ship 1508.18 ten thousand head but actually shipped 1481.75 ten thousand head, completing 98.25% of their plans; some production capacity was shipped later than planned. According to data monitoring and analysis, 173 leading hog producers in the country planned to ship 11 ten thousand head in 1519.67 month, an increase of 2.56% from the previous month. Hog supply has risen significantly. In particular, with fewer shipping days this month, the average daily shipping plan may increase sharply month over month, creating substantial pressure from excess hog supply!
On the demand side, as 11 month begins, pork purchasing and sales enter their seasonal peak. However, this month, consumption lacks substantive support, particularly the boost usually provided by holidays! Urban mobility is limited, and the recovery in household demand in the domestic market is weak. Supplies of substitute products are ample, limiting support for pork demand. Moreover, as hog shipments increase month over month and average shipping weights continue to rise, the situation of excess pork supply is further exacerbated. Buyers seeking to fatten hogs for a second time lack confidence in buying the dip, and producers lack confidence in a price increase, so the market largely continues with routine shipping. In particular, long-term losses in hog finishing and rising disease risks at pig farms have further intensified panic selling among producers. Downstream slaughterhouses face little difficulty in sourcing hogs, and mainstream slaughterhouses, under pressure from losses, are inclined to use the situation to push prices down!
Based on this analysis, amid changes in supply and demand, in 11 month, the pattern of strong hog supply and weak demand may be difficult to ease, and hog prices still face the risk of continuing to seek a bottom! As for the “floor” for this round of price declines, I personally believe that hog prices may fall below the low seen in the second quarter, with standard-weight hogs possibly dropping to around 8.5 yuan/kg! Going forward, watch for changes in market trading sentiment, especially changes in the pace of sales by corporate hog producers!