After the Spring Festival, how about the market of live pigs? What will happen in the future?
Before the Spring Festival, pork prices in China fell slightly. The adjustment of pig products transfer policy has improved the transfer of some main producing areas and some main selling areas. Under the influence of insufficient confidence in the future market and locking in the breeding profits, pigs come out ahead of schedule, and the accelerated pace of the market leads to the decline of pig prices in the production and marketing areas. The main production areas such as Northeast, Jiangxi, Hunan and Guangdong have declined significantly. According to the monitoring data of the Ministry of Agriculture and Rural Affairs, from January to December 2018, the slaughter volume of enterprises above the scale was 24.212.01 million, an increase of 9.1% compared with the same period last year. Among of them, the slaughter volume in December was 22.883.5 million pigs, an increase of 14.0% annually and a decrease of 1.6% year on year. In January 2019, the average pork price in the pork market monitored by the Ministry of Agriculture and Rural Affairs was 23.16 yuan per kilogram, down 2.2% annually and 9.0% year on year. From the perspective of pork prices in different provinces and municipalities, pork prices in production and marketing areas have risen and fallen alternately. Pork prices in Liaoning, Heilongjiang, Jilin, Shanxi and other provinces have fallen considerably, with average monthly price drops of more than 5%, and even 14.5% in Liaoning.
The Spring Festival is the peak season of traditional consumption. Before the festival, the price of pork in China dropped slightly. Zhu Zengyong, an associate researcher of the Institute of Agricultural Information of the Chinese Academy of Agricultural Sciences, believes that the main reason is the increase of pre-festival appearances and the limited boost of consumption. Especially in main districts such as Guangdong, migrant workers return home and lack of support for consumption.
And then, will the price of pork turn into an ascending channel after the Spring Festival? Industry experts predict that pork market will remain depressed after the Spring Festival.
"Throughout January, the price of white pigs in Beijing's new market was at its lowest level in the same period in nearly five years. According to this price calculation, the price of live pigs in Northeast and Hebei is significantly lower than the break-even point of farms, and is in a state of total loss. This condition will continue for some time, as white pigs on the market in January are generally overweight. This shows that due to the previous embargo, the proportion of pigs in the above-mentioned areas is still very high. Therefore, digestion of these backlogs of pigs will take some time, and the price downturn will continue for some time. Liu Tong, manager of Statistics Department of agricultural and sideline products wholesale market in Xinfangdi, Beijing, said.
Zhu Zengyong predicted that the price of pork will still drop slightly after the Spring Festival. In addition to the above market inertia, pork imports remain high. Customs statistics show that in December 2018, China imported 159,900 tons of pig products, with a trade deficit of $153 million. From January to December 2018, China imported 2.1545 million tons of pig products, with a trade deficit of $2.536 billion.
However, Zhu Zengyong believes that before and after Qingming Festival, domestic pork prices will rebound. The disruption of piglet transfer starting in the fourth quarter of 2018 will reduce the supply of piglets in four months. In December 2018, the number of live pigs in stocks decreased by 3.7% and 4.8% compared with the same period last year. Among of them, the number of retaining rings of fertile sows decreased by 2.3% and 8.3% compared with the same period of last year. Due to the decline in supply, it is estimated that domestic pig prices will rise significantly from June 2019.
