Knowledge

To provide the latest market news and hold online & offline events to assist you being well-informed and making decisions.

22

2022

-

10

Reasons for the Recent Record High Pork Prices in Domestic China

Source:

OIG+X

Since the second half of this year, the price of pork has rebounded from a low point and gone up. In late Sept, the price of pork continued to soar. In the past week, the price of pork also rose further, approaching 15 yuan. As a result, the price of pork in many places reached new highs in the year.

Since the second half of this year, the price of pork has rebounded from a low point and gone up. In late Sept, the price of pork continued to soar. In the past week, the price of pork also rose further, approaching 15 yuan. As a result, the price of pork in many places reached new highs in the year.

 

According to the data of the MARA, as of Oct 20th, the average price of pork in the national agricultural wholesale market was 35.47 yuan/kg, up 1% from yesterday.
Also, according to the NDRC, from Oct 10 to 14, the average weekly retail price of lean meat in 36 large and medium-sized cities rose by more than 40% YoY, entering the first level warning range of excessive rise.

The main reasons for this round of pork price increase are as follows: first, the pig sales of most large-scale breeding farms have recovered, a few of them have gained weight, and the breeding side generally has a strong feeling of the price being bullish and reluctant to sell; second, the phenomenon of secondary weight gain in pig circle is too much, resulting in the overall tight supply of pigs; third, sausage and curing production in some areas led to a slight increase in demand for pork.


1. Supply-demand relationship

It can be said that basically all commodity prices are related to supply and demand, and pork is no exception. When supply exceeds demand, the price of pork will be high; when supply exceeds demand, the price of pork will be low.

 

2. Feed cost

The feed cost directly affects the cost of pig raising. If the cost of pig raising in large-scale pig farms is increased, it will inevitably be passed on to consumers.

 

3. Season

Generally, summer is the off-season for pork consumption, while the consumption demand in autumn and winter is obviously better than that in summer. Therefore, when it comes to autumn and winter, pork prices will definitely rise.

 

4. Policy

That is, the national regulatory policy to stabilize the price of pork, such as the supply of reserve meat.

 

5. Pig production capacity

In the first two years, because of the ASF, the production capacity of live pigs was very low, so the price of pork was very expensive. Now the pig production capacity is at a reasonable level, so the pork price does not have the basis for a substantial increase.