Pig outlook: lean hog futures bulls back in business

US pig prices rebound this week as the economic outlook from China grows stronger.
calendar icon 16 July 2021
clock icon 9 minute read

China’s meat imports rising

China imported 743,000 MT of meat in June, a 17% retreat from year-ago levels, Chinese customs data showed. That was also a 5.8% retreat from shipments of 789,000 MT in May.

Weak domestic pork prices slowed China’s demand for imports. For the first half of 2021, China has imported 5.08 MMT of meat, topping last year’s 4.75 MMT at this point by 6.9%.

China removes restrictions for its small hog farms

China’s ag ministry announced it will no longer require small pig farms to receive environmental approval from the government before breeding pigs. This is part of China’s ongoing effort to rebuild its hog herd after African swine fever halved the country’s hog herd.

The outbreak hit small producers particularly hard, with this summer’s dive in hog prices said to be forcing small producers out of business. There is still no vaccine for the virus and outbreaks of ASF continue in northern China and Southwest Sichuan province.

Chart showing the trading trajectory of August US lean hog futures
Bulls gain momentum this week and now working to restart price uptrend. Bulls have the overall near-term technical advantage now.

© Jim Wyckoff

Pork and beef in a grocery case
The USDA expects 2021 to boast a higher pork output than 2020 and have revised their forecasts
shipping container coming into port
Pork import demand from Asia is shaping global projections
Two blue binders with the words "import" and "export" printed on them
Pork export sales fell by over 75% this week
US capitol at sunset
Government programs have sought to soften the blows that were dealt to pig producers during COVID-19
Multiple pigs in an indoor barn
Despite reports of African swine fever in Northern provinces, China's pork production reached a seven-year high
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