China Hog Market Weekly

CHINA - In this weeks China Live Hog Market Weekly, eFeedLink report that prices are generally stable; hog farmers suffer significant losses, week ending May 1.
calendar icon 2 May 2006
clock icon 3 minute read
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Price summary

Live hog prices in China were generally stable during the week ending May 1.

Although prices edged higher in areas of some provinces such as Hunan, Sichuan and Jiangsu, this provided insignificant support for China's live hog market.

Active hog procurements in some provinces only lasted a day or two before slowing down. Thus, many live hogs released into local markets were yet to be sold.

Hog farmers were worried as the Labour Day holiday in China approached on May 1. Frequently changing weather conditions and the possible recurrence of hog diseases have heightened the pressure on farmers to release their hogs for sale as soon as possible.

Market analysis

Live hog prices edged higher in Xiangtan and Yongzhou, Hunan, Nantong and Yancheng, Jiangsu, and Chengdu, Sichuan amid a pick up in trade. Pork prices in those areas also rose by RMB0.10-0.20/kg. However, many local hog farmers continued to make losses as their hogs were sold below cost.

Small-scale hog farmers have been transferring possession of their farms recently, while backyard farmers continued to leave the industry. According to statistics, losses suffered by small-scale and backyard hog farmers were between RMB50/head and RMB100/head. Big-scale hog farmers suffered losses as high as RMB150/head. State-owned farms suffered significant losses too, prompting authorities to provide aid to those farms.

Market forecast

In light of current over-production and sluggish demand for live hogs in China, hog prices are unlikely to be satisfactory for domestic farmers in the days just after the Labour Day holiday. Live hog prices in China are expected to be stable to marginally higher in the week ahead.

Farmers might be less willing to continue keeping hog inventories amid high operating costs. Thus, more live hogs are also expected to be released into the domestic market, with a pick up in trade seen possible in the near term.

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