As 10 moves into the middle of the month, domesticLive Pig Market, market feedback indicates that currently, due to the difficulty of easing pressure from hog supply, production capacity remains high, while support from the demand side is insufficient. In particular, after the Mid-Autumn Festival and National Day, demand has declined at the margin, temporarily,Pork prices riseLacking support, the market continues to follow a pattern of “falling easily and rising with difficulty”!
Data monitoring shows that, as of 10/12, the national average live pig price was 10.09 yuan/kg, down 0.04 yuan. Pig prices have plunged, with the market falling sharply. In particular, pig prices remain at a cyclical low. During the traditional “golden September and silver October” months, the trend of weak demand during the peak season for pig prices is becoming increasingly pronounced! Compared with the same period last year, pig prices are down by around 9%, and the hog-to-grain price ratio remains low. MainstreamSelf-bred and self-raisedThis week's losses are hovering around 200 yuan per head, and hopes for a market rebound remain strong!
By region, across the national markets in the north and south, among the key markets, 28 regions are in focus. The average ex-farm hog price is close to that in Hunan, at 10.1 yuan/kg. In both northern and southern regions, the hog market is mainly consolidating with a weak bias! Ex-farm hog quotes are generally 9.1~11.5 yuan/kg, with quotes in most hog markets around 9.8~10.5 yuan/kg; the market is under pressure and prices are falling! In my view, the reasoning behind the decline in hog prices is as follows:
First, pressure from hog slaughter remains unabated! This month, due to the earlier increase in the breeding sow inventory and the poor completion of slaughter plans by large-scale hog producers last month, this month's slaughter plan has increased by 1.91%! In addition, with market expectations of ample pork supplies remaining strong, confidence in price increases among producers has weakened. In the short term, amid sustained losses among independent producers and large-scale hog producers, the need to recover funds is high and willingness to slaughter is strong, putting considerable pressure on supply!
Second, the price gap between standard-weight and heavy pigs in China narrowed! Recently, as the weather has turned cooler, pigs have been gaining weight faster during fattening, and the share of medium-to-heavy pigs in market inventories has gradually recovered. The average weight of pigs shipped in China has risen, reaching 123.91 kg this week. Heavy-pig supply has improved, and the price gap between standard-weight and heavy pigs has gradually narrowed! With support from heavy pigs weakening, producers have become less willing to hold back shipments to support prices, especially in the northern and southern regions,Secondary fatteningTrading is sluggish, market sentiment is leaning toward selling, and the ability of secondary fattening operations to retain pig supplies has weakened!
Third, disease outbreaks at pig farms are becoming more frequent! Recently, as the seasons have changed, temperatures have fluctuated sharply in many areas across northern and southern China. As a result, disease outbreaks at pig farms have increased, and cases of small-scale African swine fever have risen in some regions. This has caused some concern among livestock producers, further accelerating the pace of hog shipments.
Fourth, marginal demand has weakened! Demand received little marginal support during the traditional Mid-Autumn Festival and National Day holidays. As the holidays came to an end, marginal demand declined further. Downstream market trading in white-chilled pork weakened, slaughterhouse orders fell, and operating rates continued to decline. Consumption was insufficient to cover the cost of hogs, while the average weight of slaughtered hogs increased and pork supplies remained ample. Frozen pork inventories at major slaughterhouses in the north and south remained high, and rising inventories further eroded market confidence in the outlook for prices.
Based on this analysis, amid the interplay between supply and demand, slaughterhouses’ price adjustments are putting downward pressure on hog prices. The market may briefly remain volatile with a downward bias. However, as seasonal demand gradually improves and marginal pressure from hog supplies may ease, the hog market still has support. Going forward, attention should be paid to changes in the pace of market buying and selling, especially marginal changes in demand.