In a notable turn of events, pork and hog prices in China experienced a resurgence last week, driven by last-minute stockpiling activities ahead of the Lunar New Year. This boost in values occurred against the backdrop of inclement weather conditions, including snow and rain, across much of the country, as reported by market participants to Agricensus on Monday.
China’s pig prices have been facing downward pressure due to factors such as weak consumer spending, the resurgence of African swine fever, and abundant hog and pig inventories since around August of the previous year.
According to data from China’s Agriculture Ministry published on Monday, the average price of piglets in China increased by 8.7% week-on-week to CNY26.42/kg ($3.71/kg) last week. However, this still represents a significant 20.5% drop from the same period a year ago.
Likewise, the average hog price saw a 5.8% week-on-week and a 2.8% year-on-year increase, reaching CNY15.56/kg. Meanwhile, pork prices rose by 3.6% from the previous week to CNY25.32/kg, indicating a 9.1% drop year-on-year.
Analyst Liu Chenqian from Sinolink Securities noted in a Sunday publication that slaughterhouses had been actively stockpiling animals two weeks ahead of the Lunar New Year festival. The inclement weather prompted an earlier-than-usual stockpiling schedule, influencing regional pig prices and boosting the national average prices.
However, the rebound in prices may not be sustainable. On February 1, 296,000 pigs were slaughtered nationwide, surpassing the peak volume observed before Lunar New Year last year. This suggests that both slaughter amounts and pig prices may have reached their periodic peaks, according to Liu.
With hog supplies still relatively ample and high levels of frozen pork storage, analysts from China Post Securities anticipate a decline in pig prices after the festival concludes. Despite the recent uptick, challenges persist for China’s pork market.
