Core Tip: In recent days, as the impact of the “Shuanghui Clenbuterol Incident†has gradually diminished, the price of pork in Shandong and other places has stopped falling. The "piggy cycle" effect of CPI reproduces the peak of pig price peaks around May.
Recently, as the impact of the “Shuanghui Clenbuterol Incident†gradually faded, the prices of pork in Shandong and other places have stopped falling.
The Zichuan Zhengye Livestock Farm in Zibo City, Shandong Province currently has more than 6,000 live pigs and is a large-scale farm. An Shengmin, owner of the farm, said that after a few days on March 15, the local pig price dropped slightly, from 15.4 yuan per kilogram to 14.9 yuan, and in the last few days it has risen to 15.5 yuan.
According to the Shandong Province Animal Husbandry and Veterinary Information Center's monitoring of the price of 25 markets in the province, the price of live pigs in Shandong Province was 14.75 yuan per kilogram during the 11th week (March 14 to March 20). 0.89%, up 59.12% year-on-year; pork price was 23.33 yuan per kilogram, which was the same as last week's price and up 42.26% year-on-year. It can be inferred that the current price of live pigs in Shandong Province and even the whole country is mainly affected by the relationship between supply and demand, and the impact of the “lean meat extract†event on the live pig market is not obvious.
According to statistics from 39 price information points in the 13 major pig producing provinces selected by the Ministry of Agriculture, except for pork sales in Luoyang, Henan, which have decreased significantly, pork sales at other information points are not significantly affected by the “lean meat eventâ€. The price of pork was basically stable.
Feng Yonghui, chief analyst of China Live Swine Early Warning Network, said that under the high feed costs, the current shortage of livestock, and some pig farmers are not actively encouraged by the disease, the trend of pig prices will tend to be stronger in the later period.
He specifically analyzed that, first of all, the cost of feed has risen sharply, and the price of corn and ingredients has risen by about 15% or about 10% from the same period last year, which has led to a rise in the cost of raising pigs.
Second, the loss in the previous period led to insufficient stocks in the current period. Before the first half of 2010, some pig farmers suffered double pressures of “high cost and low price†and sustained losses. A large number of small and medium-sized farmers were forced to withdraw, resulting in insufficient stocks of sows and fat pigs.
In addition, the impact of swine disease in 2010 jumped from 2.6 (more severe) in 2009 to 3.21 (serious), hitting farmers' enthusiasm for replenishment and speeding up slaughter of pigs.
According to industry sources, under the influence of the "Pig Cycle" rule, this year will usher in a new "crest" for pork prices. In recent years, domestic live hog prices have experienced two distinct cycles of volatility. In September 2004 and January 2008, “crests†formed at intervals of about 3 years. The pig farmers in Binzhou City, Shandong Province have been breeding new pigs for more than ten years and have made statistics on the cycle and extent of live pigs' ups and downs in recent years. He said: “Since I started raising pigs, the fluctuation period of the price of pigs in Shandong is three to four years, and the peak price and trough price are six or seven yuan or even more than ten yuan per kilogram.â€
“The 'crest' of the last pork price appeared in January 2008. If you follow the pattern of previous years, this year's pork price is in the 'peak' period of rising, and the peak is likely to appear in this year.†Feng Yonghui said.
Feng Yonghui estimates that pig prices will increase by around 30% year-on-year in 2011, according to data such as the sow population level at the end of 2010 below the equilibrium level of 15%. Also, around May of this year, the national average price of pigs may approach 15 yuan per kilogram, and the local maximum price may reach around 16 yuan per kilogram.
Some pig farmers said that despite the high price of pigs, some farmers have begun to make up the bar recently, but it will take some time before the supply of live pigs is restored. It is expected that the price of live pigs will increase steadily in the first half of this year and enter in July and August. In the off-season, hog prices may drop slightly, but there is little chance of a significant drop.
Many people believe that the price of pork has historically been closely related to the CPI. The high price of pork will drive China's CPI to continue rising in the near future. For example, in January 2008, the price of pork rose by 58.8% year-on-year, which drove the CPI to hit a record high of 11.1% in the previous 11-year period; in February 2008, pork prices continued to remain high, and the CPI rose by as much as 8.7% during the month. “In the eight projects that constitute the CPI, the weight of food products accounts for about 30%, and pork accounts for a larger proportion in the food category,†said Li Tiegang, associate dean of School of Economics at Shandong University.
Recently, as the impact of the “Shuanghui Clenbuterol Incident†gradually faded, the prices of pork in Shandong and other places have stopped falling.
The Zichuan Zhengye Livestock Farm in Zibo City, Shandong Province currently has more than 6,000 live pigs and is a large-scale farm. An Shengmin, owner of the farm, said that after a few days on March 15, the local pig price dropped slightly, from 15.4 yuan per kilogram to 14.9 yuan, and in the last few days it has risen to 15.5 yuan.
According to the Shandong Province Animal Husbandry and Veterinary Information Center's monitoring of the price of 25 markets in the province, the price of live pigs in Shandong Province was 14.75 yuan per kilogram during the 11th week (March 14 to March 20). 0.89%, up 59.12% year-on-year; pork price was 23.33 yuan per kilogram, which was the same as last week's price and up 42.26% year-on-year. It can be inferred that the current price of live pigs in Shandong Province and even the whole country is mainly affected by the relationship between supply and demand, and the impact of the “lean meat extract†event on the live pig market is not obvious.
According to statistics from 39 price information points in the 13 major pig producing provinces selected by the Ministry of Agriculture, except for pork sales in Luoyang, Henan, which have decreased significantly, pork sales at other information points are not significantly affected by the “lean meat eventâ€. The price of pork was basically stable.
Feng Yonghui, chief analyst of China Live Swine Early Warning Network, said that under the high feed costs, the current shortage of livestock, and some pig farmers are not actively encouraged by the disease, the trend of pig prices will tend to be stronger in the later period.
He specifically analyzed that, first of all, the cost of feed has risen sharply, and the price of corn and ingredients has risen by about 15% or about 10% from the same period last year, which has led to a rise in the cost of raising pigs.
Second, the loss in the previous period led to insufficient stocks in the current period. Before the first half of 2010, some pig farmers suffered double pressures of “high cost and low price†and sustained losses. A large number of small and medium-sized farmers were forced to withdraw, resulting in insufficient stocks of sows and fat pigs.
In addition, the impact of swine disease in 2010 jumped from 2.6 (more severe) in 2009 to 3.21 (serious), hitting farmers' enthusiasm for replenishment and speeding up slaughter of pigs.
According to industry sources, under the influence of the "Pig Cycle" rule, this year will usher in a new "crest" for pork prices. In recent years, domestic live hog prices have experienced two distinct cycles of volatility. In September 2004 and January 2008, “crests†formed at intervals of about 3 years. The pig farmers in Binzhou City, Shandong Province have been breeding new pigs for more than ten years and have made statistics on the cycle and extent of live pigs' ups and downs in recent years. He said: “Since I started raising pigs, the fluctuation period of the price of pigs in Shandong is three to four years, and the peak price and trough price are six or seven yuan or even more than ten yuan per kilogram.â€
“The 'crest' of the last pork price appeared in January 2008. If you follow the pattern of previous years, this year's pork price is in the 'peak' period of rising, and the peak is likely to appear in this year.†Feng Yonghui said.
Feng Yonghui estimates that pig prices will increase by around 30% year-on-year in 2011, according to data such as the sow population level at the end of 2010 below the equilibrium level of 15%. Also, around May of this year, the national average price of pigs may approach 15 yuan per kilogram, and the local maximum price may reach around 16 yuan per kilogram.
Some pig farmers said that despite the high price of pigs, some farmers have begun to make up the bar recently, but it will take some time before the supply of live pigs is restored. It is expected that the price of live pigs will increase steadily in the first half of this year and enter in July and August. In the off-season, hog prices may drop slightly, but there is little chance of a significant drop.
Many people believe that the price of pork has historically been closely related to the CPI. The high price of pork will drive China's CPI to continue rising in the near future. For example, in January 2008, the price of pork rose by 58.8% year-on-year, which drove the CPI to hit a record high of 11.1% in the previous 11-year period; in February 2008, pork prices continued to remain high, and the CPI rose by as much as 8.7% during the month. “In the eight projects that constitute the CPI, the weight of food products accounts for about 30%, and pork accounts for a larger proportion in the food category,†said Li Tiegang, associate dean of School of Economics at Shandong University.
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