China Hog Market Weekly

CHINA - In this weeks China Hog Market Weekly, eFeedLink report that previously rising hog prices in China moved lower during the week ending Oct 2.
calendar icon 3 October 2006
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Price summary

Relatively significant price falls were seen in provinces including Guangdong, Guangxi, Hunan, Hubei and Jiangxi. Some integrated hog farms in southern China incurred staggering losses of about RMB80/head.

Market analysis

During the week in review, China's live hog market was characterised by the following:

  • Due to currently low hog inventory levels, hog traders have procured mostly from medium-scale or major integrated hog farms.

  • Although very few hogs were released into markets in the south due to the epidemic situation there, integrated hog farms continued to make consecutive deliveries to Guangdong. Significantly more hogs were released into local markets in northern China.

  • The recent clenbuterol incident in Shanghai has dampened pork demand in many other regions. Hence, hog demand improved only slightly in the days leading up to China's National Day holiday and Mid-Autumn Festival in early-October.

  • The big difference in hog prices between northern and southern regions has given rise to significant profit potential for hog traders. This, coupled with currently cooler autumn temperatures, has prompted hog traders to increase deliveries of low-priced hogs from the north to the south. Consequently, transacted prices in the major hog production region of Hunan have fallen.

  • Meanwhile, the worsening epidemic situation in the north of late has weighed on hog prices nationwide. Hence, the relatively high hog prices in the south failed to bolster prices in the north, and even moved lower recently.

Market forecast

More hogs are expected to be released into the market during the current week-long National Day holiday and upcoming Mid-Autumn Festival. With a pick up in pork demand seen during this celebratory period, China's live hog prices should be stable to marginally higher in the days ahead.

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