Pig farming has entered a profitable period for the entire industry
2024-05-31
"Recently, there has been a significant rebound in pig prices. In mid to late May, pig farming shifted from losses across the industry to profits across the entire industry." Zhu Zengyong, Chief Analyst of the Ministry of Agriculture and Rural Affairs' pork industry chain monitoring and early warning, told reporters. Since the beginning of this year, the overall price of pigs in China has shown a fluctuating rebound trend. The price of live pigs increased from 14.63 yuan/kg in the first week of January to 15.65 yuan/kg in the fourth week of May. The fluctuation of pork prices is similar to that of live pigs, with a rebound of 24.22 yuan/kg in the third week of January and an increase of 25.23 yuan/kg in the fourth week of May, a month on month increase of 1.4% and a year-on-year increase of 4.9%. On May 24th, the average wholesale price of white pigs in Beijing's Xinfadi Agricultural Products Wholesale Market was 19.90 yuan/kg, with a significant increase compared to the previous week, month on month, and year on year. Last week, the daily average market volume of Xinfadi white pigs was 1583.43, an increase of 2.21% from last week's 1549.14 pigs. Last year, the daily average market volume of Xinfadi white pigs was 1685.71. Last week, the daily average listing volume of Xinfadi White Pigs increased, mainly due to the introduction of a new slaughterhouse to the meat trading hall of Xinfadi Market, which effectively ensured the daily entry trading volume. In the context of an increase in the daily average listing volume month on month, the wholesale average price of white pigs continues to rise, indicating that the price increase is not directly related to insufficient market supply Liu Tong, Manager of the Statistics Department of Beijing Xinfadi Agricultural Products Wholesale Market, said. Starting from mid to late May, pig farming has entered a period of comprehensive profitability. Since the beginning of this year, the cost of feed corn and soybean meal for pig farming has decreased from 2.76 yuan/kg and 4.27 yuan/kg in the first week of January to 2.54 yuan/kg and 3.75 yuan/kg in the fourth week of May, respectively, a year-on-year decrease of 13.0% and 16.7%, showing an overall downward trend. At present, a 120kg fattening pig is being produced, with an average breeding cost of 15.5 yuan/kg. Overall, the entire pig farming industry entered a period of comprehensive profitability in mid to late May. Why is the price of pigs rebounding? Zhu Zengyong stated that the main reason is the improvement in the supply and demand situation. From the production side, under the joint action of market guidance and capacity regulation, the national stock of sows capable of breeding has been continuously declining since last year. According to data from the National Bureau of Statistics, at the end of the first quarter, the total number of live pigs in China was 408.5 million, a decrease of 5.9% month on month and 5.2% year-on-year. In the first quarter, the total number of live pigs sold nationwide was 194.55 million, a year-on-year decrease of 2.2%; The pork production was 15.83 million tons, a year-on-year decrease of 0.4%. From January to April, designated pig slaughtering enterprises above designated size slaughtered 109.38 million pigs, a year-on-year increase of 2.3%. From the perspective of live weight output, although higher than the same period last year, there has been a slight decrease compared to the previous year, indicating a decrease in the inventory of medium and large pigs. The decrease in the number of breeding sows has led to a reduction in the adaptability of pig production, and the situation of oversupply of pigs has been basically reversed, achieving a balance between supply and demand. From the perspective of pork imports, from January to April, the import of meat and miscellaneous goods reached 2.22 million tons, a year-on-year decrease of 12.6%. Among them, pork imports reached 340000 tons, a year-on-year decrease of 48.4%, and monthly pork imports dropped to the lowest level since 2016. Pork imports have significantly decreased, and frozen inventory has also decreased month by month. The national pork supply and demand relationship began to improve significantly in May, driving a significant rebound in pork prices from mid to late May. For this round of rising pig prices, industry insiders generally believe that although the inventory of sows that can be bred has decreased compared to the previous period, it has not decreased to the extent of a shortage of pigs. Liu Tong said that the increase in pig prices may be related to some farms being reluctant to sell. The situation of oversupply of live pigs has basically been reversed, and meat prices have rebounded to the level where breeding farms have overcome losses, but the upward space may not be very large. "From October last year to March this year, the number of newborn piglets decreased by 4.9% year-on-year. Considering the 6-month fattening cycle and the seasonal increase in pork consumption, it is expected that the pig market will enter a supply-demand balance, and pig prices will mainly increase seasonally in the second half of the year." Zhu Zengyong predicts that the national pig prices will enter a seasonal upward trend in the second half of the year. As the effect of reducing pig production capacity gradually becomes apparent, the supply and demand relationship in the pig market will further improve in the third quarter, and pig farming will continue to maintain profitability. (Lai Xin She)
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