1. Price Trend

According to data from SunSirs, domestic hog prices continued to rebound after bottoming out in 2019. In the second half of the year, the sharp increase in prices continued to hit a record high. In November, the price surged back slightly and lagged behind the overall high. The average price of ternary pigs at home and abroad on January 1 was 11.30 RMB / kg, and the average price on December 27 was 33.53 RMB / kg, which rose 196.73% during the year.

2. Market Analysis

Over the whole year of 2019, the domestic hog price trend can be roughly divided into four stages:

The First Stage (January to February): Around the Spring Festival, pig prices fluctuate at a low level.

Affected by the African swine fever epidemic, coupled with the sell-off by farmers before the Spring Festival, the meat market supply has increased sharply. The demand for terminal meat has fallen short of expectations. The market supply has exceeded demand, which has caused pig prices to continue to fluctuate at the bottom.

After the Spring Festival, due to the suppression of the African swine fever epidemic, the domestic pig inventory is generally adjusted at a low level. The breeding industry is optimistic about the reversal of the pig cycle. The high investment enthusiasm has driven the domestic pig related stocks to continue to rise sharply, pushing domestic pig prices to rebound slightly. The overall hog market price fluctuated at a low level.

The Second Stage (From March to May): The "supplier" turned defeat into victory, and the pig price fluctuated after a slight recovery.

In March, after the lifting of the ban on the export of live pigs in some provinces and cities, the problem of tight supply in the pig market was highlighted. The purchase price of slaughterhouses continued to rise. Farmers generally had a price-stricken attitude. Under the support of the seller's market conditions, farmers' prices increased which drove the domestic hog market prices up, with an overall increase of over 10% in early March.

Then, the enthusiasm for investment in the pig industry declines, and favorable news on stock market fades away. Plus, the weak demand in the terminal meat market remains. In some areas, the outbreak of the African swine fever epidemic once again triggered a new round of selling. Slaughterhouses took advantage of low-price acquisitions. The market demand is even weaker after weather turns warm. The domestic meat market supply and demand has once again entered a stalemate. The market is in a long and short game, and the overall pig price is in a dilemma. From March to May, the domestic pork price fluctuated slightly.

The Third Stage (June to October): The "supplier" wins and chases, the domestic pig price rises step by step.

In June, affected by the continuous decline in the domestic hog inventory, the domestic hog market supply has become tighter. And the slaughterhouse procurement difficulties have continued to increase. In order to ensure the market supply, the purchase price has continued to increase, and farmers generally treasured selling prices, driving the domestic hog market prices to enter rapidly. Pig prices in many places in the north rose rapidly in mid-to-late June and broke through 9 RMB / gate. In June, pig prices rose sharply by 12.98%, and in July rose by 6.96%. With frequent extreme weather in August and increasing demand for meat after the weather turned cold, domestic hog prices continued to soar by 27.13%. The supply side continued to gain the position in September, with pig prices hitting record highs and rising again by 17.07%.

During the National Day, the tight supply of the hog market supported the overall continued strong operation of the domestic hog market price. The outflow of a small amount of frozen meat in some provinces and cities has limited stabilizing effect on the ultra-high meat price. The source of heavy pigs dropped sharply year-on-year, and it was difficult to collect pigs at high prices, which helped the domestic hog market prices to rise sharply again in October. At the end of the month, domestic hog market prices broke through the 40 RMB / kg mark, and domestic pig prices hit a record high in the second half of the year. .

Fourth stage: (November to December): Due to multiple factors, the price of pigs rose slightly and lagged behind and fluctuated forward.

Entering November, the extremely high meat price has restricted the consumption of terminal meat. In addition, under the influence of factors such as frozen meat and imported meat entering the market one after another, the domestic hog market price has risen sharply as a whole.

The drastic decline in pig prices has caused farmers to relax their prices. The live pig market has continued to increase, the live pig supply has continued to increase, and the terminal demand has not shown a significant rebound. The unbalance between market supply and demand has exaggerated.

In November, domestic hog prices continued to fall. Live pig prices in some areas have fallen back to the 30 RMB / kg range. In December, the game of supply and demand entered a stalemate again, and pig prices continued to move at high levels and fluctuated slightly.

Feed such as corn and soybean meal prices were stable although live pig price increased significantly.

Throughout the year, the overall domestic corn price fluctuated at a relatively low level. The price of soybean meal fell slightly in the second half of the year with following a sharp rise in pig prices. The cost of breeding and feeding increased slightly compared to 2018.

The quantity of live pigs kept low, and the price of pigs rose sharply. The prices of domestic piglets and sows continued to rise during the year, and the cost of supplementing the pens increased significantly year-on-year.

In order to ensure the resumption of live pig production, various provinces and cities have successively introduced relevant subsidy policies during the year. The domestic pig stocks have stopped falling and stabilized in the fourth quarter. After a slight rebound, the overall domestic pig stocks will continue to be low in the short term, which supports the market price of pigs.

Import Amount of Pork

According to the latest customs data, from January to November 2019, China imported 5.485 million tons of meat (including liver, kidney, hoof, etc.), a cumulative year-on-year increase of 42%. In November, China imported 644,000 tons of meat (including liver, kidney, hoof, etc.), an increase of 82% year-on-year, of which 230,000 tons of pork were imported, with a year-on-year increase of 151.2%.

From January to November 2019, China imported a total of 173.28122 tons of pork. It is expected that China's pork imports will exceed 2 million tons in 2019, and the successive entry of imported meat into the market will have a certain effect on the domestic meat market price.

3. Market Forecasting

Li Wenxu, a pig product analyst at SunSirs, believes that the current domestic pig inventory is still at a relatively low level. Near the end of the year, domestic demand for the terminal meat market has increased, and factors such as the continued high level of breeding costs will form a certain support for the market price of pigs. Under the suppression of the price of meat out of the warehouse and the large amount of low-priced imported meat entering the market coupled with the rebound of the inventory volume. The market price of pigs has once again risen under pressure, and there is a long and short game. It is expected that domestic pig prices will generally fluctuate at a high level in the first half of 2019.

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