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2022

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Recently, the Overall Domestic Pig Price in China Has Declined Significantly

Source:

OIG+X

Normally the days before the Spring Festival are the annual peak demand season for the pig industry, however, recently, the domestic pig price has declined significantly as a whole, and is out of the warning range of excessive rise.

 

Normally the days before the Spring Festival are the annual peak demand season for the pig industry, however, recently, the domestic pig price has declined significantly as a whole, and is out of the warning range of excessive rise.

 

The NDRC reported on Dec 16 that, the weekly average retail price of lean meat in 36 large and medium-sized cities rose less than 30% YoY from Dec 5 to 9. With the approaching of New Year's Day, Spring Festival and other peak consumption seasons, in order to ensure that the quantity and price of meat are stable during the "Two Festivals" period. In the future, the government will release the pork reserve.

 

Recently, the price of pig futures fell sharply. Since Dec, the pig futures index has fallen by nearly 20%. Since the peak price in mid Oct, pig futures has dropped by about 35% . From the perspective of spot products, the pig price has also continued to fall, and some regions have fallen close to the cost line. The price of pig with standard weight in Henan, Anhui, Jiangsu and other places has dropped to 16.4-17.7 yuan/kg.

 

Expectation of pig price next year

However, Guo Dashun, a pig researcher of Dongwu Futures, believes that the pig market is not particularly pessimistic after the year. The main reason is that after the impact of the epidemic, the demand may usher in a recovery growth after the first quarter of next year. In addition, the pig price in Mar and Apr next year still corresponds to the relative low point of the sow stock, and the current piglet supplement has been restrained by the decline of the pig price. As long as fat pigs at the breeding end before the year can be sold, and the market weight drops from the high to the normal level, the pig price is expected to rebound after the year.

 

Sun Shuangsheng, the secretary of the Tangrenshen, said: "With the optimization and adjustment of the epidemic prevention and control measures, and the rapid decline of pig prices causing panic selling by farmers, there was a wave of peak selling, resulting in a short-term oversupply situation. Combining the general rules of the pig cycle and some data analysis, we are relatively optimistic about the pig price next year."

According to the law of pig breeding, it generally takes at least 10 months from breeding sows to the marketing of pigs. Even if breeding sows can be grow significantly next year, the substantial changes in the industry's supply and demand relationship will not be apparent until the following year. Therefore, it is expected that the pig price will be generally good next year.