10 is approaching the halfway point. Recently, the domestic hog market has come under downward pressure, and hog prices have fallen sharply. The average price of standard hogs in China has broken below 5 yuan/jin again, with hog prices returning to their “original price.” The average hog price is nearing the low seen at the end of 9! In particular, bearish sentiment in the hog market is strong, and market fundamentals are weak. In the short term, hog prices may fluctuate downward, and the average price may continue to shift lower. So, what is the “floor” for hog prices going forward? See the analysis below:
According to institutional data analysis, as of 10 month 13 day,Three-way crossbred pigsThe average price of hogs sold was 9.99 yuan/kg, down 0.1 yuan from yesterday. Hog prices are approaching the low of 9.96 yuan/kg at the end of 9 month, with the market showing a “larger-than-expected” decline. Prices were down 9.6% year on year. Across both northern and southern regions, the market remained sluggish. In higher-priced areas, including the East China markets of Jiangsu, Zhejiang, and Shandong, hog prices fell to around 10.15~10.4 yuan/kg. In lower-priced areas, including the Northeast, Northwest, and Southwest, hog prices generally fell back to around 9.6~10 yuan/kg, with the price level dropping into the “4-yuan era”!
Currently, pig prices are under pressure and falling. Market fundamentals are bearish, with strong sentiment favoring either further declines or stability. Confidence in a price increase is lacking, and in the short term, pig prices may continue to trend lower! The logic supporting the decline is analyzed as follows:
First, the consumer market. At present, pork consumption is sluggish. After the National Day holiday, demand has continued its seasonal decline. In particular, reduced population mobility has lowered the concentration of urban consumption, while demand for group catering has cooled. In the domestic market, household demand has been moderate. Changes in dietary habits have led to increased substitution for pork. To date, the operating rate of sampled slaughterhouses is around 30.14%, providing insufficient support for consumption!
Second, the supply market: the supply side is currently ample! On the one hand, planned hog marketings are relatively high. In 10 month, the marketing volume of large-scale pig farming companies increased further! According to Zhuochuang data monitoring, in 10 month, the planned marketing volume of the sampled pig farming companies increased by 2.45% month over month. Production capacity remains in a phase of concentrated release. Moreover, affected by the holiday last month, large-scale pig farming companies marketed hogs at a slower pace, and daily marketing pressure was relatively high in the middle and latter part of the month, while producers showed a strong willingness to sell!
Third, disease risks at pig farms are increasing! Recently, breeding risks in the live hog market have risen sharply. In particular, as the seasons change, temperatures have fluctuated widely across many areas in both northern and southern China, sharply increasing stress risks for hogs being fattened. Previously, frequent disease outbreaks were reported at pig farms in several areas of central China. This has also dampened market confidence in rising prices, and, for now, panic-driven hog sales remain unabated!
Fourth, the average weight of hogs at slaughter is rising! According to institutional monitoring, last week the average weight of domestically raised hogs at slaughter was 123.91 kg, up 0.13 kg from the previous week. Slaughter weights continued to increase, and the market inventory structure changed! In particular, inventories of medium and large hogs recovered, and the pork-producing capacity per market hog was ample. Moreover, with frozen pork inventories at a high level, producers’ confidence in a bullish outlook weakened, further intensifying their desire to convert assets into cash by selling hogs;
Fifth, market sentiment for bottom-fishing is weak! At present, with the fourth quarter just beginning, the market is optimistic about the outlook for southern China’s cured meat season, and seasonal demand is also set to enter its peak period. However, the outlook for hog and pork supplies is ample, the proportion of heavyweight hogs in the inventory is gradually increasing, confidence in short-term secondary fattening is weak, and market entry lacks concentration. Demand for standard-weight hogs is showing somewhat weak support!
Based on this analysis, amid pressure from multiple supply and demand factors, pig prices have recently come under pressure and fallen, with the average live pig price dropping below 10 yuan/kg! In my view, pig prices may continue to retreat in the period ahead, with a potential floor around 9.8 yuan/kg! Support from secondary fattening operations entering the market at lower prices and from breeding operations reducing sales volumes and raising prices is strengthening. In theory, pig prices may have a chance to recover and rise after mid-month!
According to institutional data analysis, as of 10 month 13 day,Three-way crossbred pigsThe average price of hogs sold was 9.99 yuan/kg, down 0.1 yuan from yesterday. Hog prices are approaching the low of 9.96 yuan/kg at the end of 9 month, with the market showing a “larger-than-expected” decline. Prices were down 9.6% year on year. Across both northern and southern regions, the market remained sluggish. In higher-priced areas, including the East China markets of Jiangsu, Zhejiang, and Shandong, hog prices fell to around 10.15~10.4 yuan/kg. In lower-priced areas, including the Northeast, Northwest, and Southwest, hog prices generally fell back to around 9.6~10 yuan/kg, with the price level dropping into the “4-yuan era”!
Currently, pig prices are under pressure and falling. Market fundamentals are bearish, with strong sentiment favoring either further declines or stability. Confidence in a price increase is lacking, and in the short term, pig prices may continue to trend lower! The logic supporting the decline is analyzed as follows:
First, the consumer market. At present, pork consumption is sluggish. After the National Day holiday, demand has continued its seasonal decline. In particular, reduced population mobility has lowered the concentration of urban consumption, while demand for group catering has cooled. In the domestic market, household demand has been moderate. Changes in dietary habits have led to increased substitution for pork. To date, the operating rate of sampled slaughterhouses is around 30.14%, providing insufficient support for consumption!
Second, the supply market: the supply side is currently ample! On the one hand, planned hog marketings are relatively high. In 10 month, the marketing volume of large-scale pig farming companies increased further! According to Zhuochuang data monitoring, in 10 month, the planned marketing volume of the sampled pig farming companies increased by 2.45% month over month. Production capacity remains in a phase of concentrated release. Moreover, affected by the holiday last month, large-scale pig farming companies marketed hogs at a slower pace, and daily marketing pressure was relatively high in the middle and latter part of the month, while producers showed a strong willingness to sell!
Third, disease risks at pig farms are increasing! Recently, breeding risks in the live hog market have risen sharply. In particular, as the seasons change, temperatures have fluctuated widely across many areas in both northern and southern China, sharply increasing stress risks for hogs being fattened. Previously, frequent disease outbreaks were reported at pig farms in several areas of central China. This has also dampened market confidence in rising prices, and, for now, panic-driven hog sales remain unabated!
Fourth, the average weight of hogs at slaughter is rising! According to institutional monitoring, last week the average weight of domestically raised hogs at slaughter was 123.91 kg, up 0.13 kg from the previous week. Slaughter weights continued to increase, and the market inventory structure changed! In particular, inventories of medium and large hogs recovered, and the pork-producing capacity per market hog was ample. Moreover, with frozen pork inventories at a high level, producers’ confidence in a bullish outlook weakened, further intensifying their desire to convert assets into cash by selling hogs;
Fifth, market sentiment for bottom-fishing is weak! At present, with the fourth quarter just beginning, the market is optimistic about the outlook for southern China’s cured meat season, and seasonal demand is also set to enter its peak period. However, the outlook for hog and pork supplies is ample, the proportion of heavyweight hogs in the inventory is gradually increasing, confidence in short-term secondary fattening is weak, and market entry lacks concentration. Demand for standard-weight hogs is showing somewhat weak support!
Based on this analysis, amid pressure from multiple supply and demand factors, pig prices have recently come under pressure and fallen, with the average live pig price dropping below 10 yuan/kg! In my view, pig prices may continue to retreat in the period ahead, with a potential floor around 9.8 yuan/kg! Support from secondary fattening operations entering the market at lower prices and from breeding operations reducing sales volumes and raising prices is strengthening. In theory, pig prices may have a chance to recover and rise after mid-month!