Price summary

Cross province deliveries, though few, were more than that the previous week. With many workers returning to the city after the Spring Festival holiday, hog deliveries from the countryside to the city and urban pork demand improved.

Hog prices in northern China were mostly lower than that in southern regions. However, overall delivery volume between provinces was low due to limited transport availability and the insignificant difference in hog prices between both regions. Hog prices in southern China were also affected, such as in Guangdong province where prices moved lower in the past week.

Market analysis

Hog prices fell by different extents in the provinces of Hebei, Henan, Shandong, Jiangsu, Hunan, Hubei, Guangdong and Sichuan. Profit margins from cross province deliveries in northern and southern regions were small. Coupled with sluggish pork demand within the provinces, prices consequently fell but mostly by a smaller extent compared with the previous week.

Meanwhile, prices in Guangxi were stable mainly due to increased hog deliveries to Guangdong over the previous week in light of the significant price difference between both regions. This lent some support to local prices.

Market forecast

The smaller fall in hog prices over the past week reflected an improvement in urban pork demand. With the Spring Festival over, hog deliveries should gradually pick up in the near term. However, with hog farmers inclined to release their stocks quickly, prices in China are expected to remain weak in the week ahead.

Source: eFeedLink - 21st February 2006