China: Hog Markets
CHINA - Looking at the size of the breakdown of the inventory for October, 2012-breeding stock was around 50.94 million and total on farm inventory was around 471.41 million (as compared to September 2012-breeding stock was around 50.79 million and total on farm inventory was around 470.94 million), writes Ron Lane, Senior Consultant for Genesus China.
7 March 2013
4 minute read
For November 2012, the breakdown of the inventory for breeding stock was around 50.79 million (same as September 2012) and total on farm inventory was around 467.64 million. The 467.64 million head for November is down 0.2 per cent from last year while the November sow inventory is up 3.40 per cent from last year (year over year). For 2012, total farm inventory was projected to increase by 5 to 6 per cent but currently, it looks as if it will be flat. However sow inventory is up from last year. In 2011, the average inventory for breeding stock was 49.29 million and total on farm inventory was 468 million.
Profit margins are now showing positive returns. In November 2012, profit margins were showing a profit of 74 RMB/head ($11.90 USD/head) average (but there was a vast range from losses of 200 RMB/head ($ 32.15 USD/head) in some major pork production regions. At that time, many farmers were saying they were below breakeven. Other farmers indicated some profits getting to 100+ RMB/head ($ 16.08+ USD/head)). Currently, profit margins have jumped. As of 9 January 2013, the profit margin was approaching 360 RMB/head ($57.88 USD/head) marketed from a farrow to finish production unit. Just last week, the profit margin was estimated to be 254 RMB/head ($40.84 USD/head)—up from 229 RMB /head ($36.82USD/head) the week before. A major increase in only two weeks. At the end of March 2012 the profit margin was at 187 RMB/market pig ($30.06 US); down as compared to late January at 600 RMB/market pig ($96.45 USD). Average profit for 2011 was estimated at 500 RMB/ pig ($80.13 US).
| Price | 9 January 2013 | 9 January 2012 | % increase/decrease year-on-year |
|---|---|---|---|
| Pig price | 17.53 RMB/kg ($2.82 USD/kg) | 17.27RMB/kg ($2.78 USD/kg) | +1.5% |
| Pork price | 25.27 RMB/kg ($4.06 USD/kg) | 27.20 RMB/kg ($4.37 US/kg) | -7.1% |
| Piglet price | 24.62 RMB/kg ($3.96 US/kg) | 28.49 RMB/kg ($4.58 US/kg) | -13.6% |
| Sow price | 1,703 RMB/head ($273.79 US/head) | 1,815 RMB/head ($291.80 US/head) | -6.2% |
What to watch for over the next few months!!!
This week, the pig to grain price ratio is 7.52:1; still about 4.6 per cent below last year levels. For January, 2012, a 7.79:1 ratio was calculated. During the week of 15 November 2012, pig prices rose slightly and the main wholesale market for corn prices dropped even more and thus a pig to grain price was 6.53:1. Last week, the pig to grain price ratio was 7.23:1. It has been more than 12 consecutive weeks that the pig to grain ratio has been above the universally recognized breakeven point of 6.00:1 or better).
With notes from: the pigsite.com; livestock.feedtrade.com.cn; China Daily; Asian-agribiz.com; MOA; NBS; soozhu.com and various Chinese Ministries.
| Genesus Global Market Report Prices for the week of February 25, 2013 | ||
|---|---|---|
| Country | Domestic price (own currency) | US dollars (Liveweight a lb) |
| USA (Iowa-Minnesota) | 76.82 USD/lb carcass | 56.85¢ |
| Canada (Ontario) | 1.49 CAD/kg carcass | 56.59¢ |
| Mexico (DF) | 19.10 MXN/kg liveweight | 68.13¢ |
| Brazil (South Region) | 3.18 BRL/kg liveweight | 72.89¢ |
| Russia | 72 RUB/kg liveweight | $1.06 |
| China | 15.84 RMB/kg liveweight | $1.15 |
| Spain | 1.374 EUR/kg liveweight | 81.23¢ |
| Vietnam | 38,500 VND/kg liveweight | 83.48¢ |
| South Korea | 2,840 KRW/kg liveweight | $1.19 |
