Price Weekly Report | Active Slaughter Supply, Hog Prices Continue to Test Lows

According to the Ministry of Agriculture and Rural Affairs monitoring, on March 13, the average price of pork at national wholesale markets was 16.17 yuan/kg. Compared to last Friday (March 6), when it was 17.02 yuan/kg, it decreased by 5%. The average price this week was 16.7 yuan/kg, down 2.7% from last week’s average of 17.17 yuan/kg.

This week, the domestic live pig prices generally continued to decline, with weekly average prices decreasing week-on-week. According to data from China Swine Industry Network, on March 13, the price of live pigs (external three-way cross) was 10.29 yuan/kg, down 1.8% from last Friday (March 6), when it was 10.48 yuan/kg. From the weekly average perspective, the average price of live pigs this week was 10.32 yuan/kg, down 2.9% from last week’s average of 10.63 yuan/kg.

Recent pork and live pig prices. Chart by The Paper News

This week, the average weight of traded live pigs nationwide continued to rise. Zhuochuang Information monitored the national average trading weight of live pigs at 125.6 kg, up 0.16% week-on-week. Most provinces saw an increase in average trading weight, with declines mainly in Suzhou, Anhui, and the two lakes regions. The digestion of standard pigs remains manageable, and the proportion of standard pigs leaving the farm is relatively low, so there is not much pressure on digestion. However, the weight gain rate of live pigs accelerated during the week, and the narrowing of the fat-to-standard pig price gap encouraged farmers to increase pig sales. But since the market for large pigs is limited by a single channel for digestion, there is still passive holding of large pigs in some areas, leading to continued increases in average trading weight. Due to accelerated digestion of large pigs and declining pig stocks in Anhui and the two lakes regions, the average trading weight slightly decreased. Key domestic slaughter enterprises’ operating rates this week increased week-on-week, with an average of 31.98%, up 2.98 percentage points from last week. As pork prices decline, terminal pork consumption has slightly improved, and with the reopening of universities, downstream stocking demand has recovered. Slaughter enterprises’ orders are gradually increasing, supporting the rise in operating rates.

Dadi Futures believes that recently, farmers have been actively selling pigs, but the off-season terminal demand has been sluggish. Based on the weight of pigs sold, reducing weight still faces certain difficulties. The key is how to digest the existing stock, with a focus on changes in pig weight. Early in the week, influenced by geopolitical factors, feed raw material prices performed strongly, and the breeding sector also experienced a noticeable rebound driven by sentiment. However, the actual impact on the live pig market remains limited, mainly driven by strong supply and weak demand. Regarding reproductive capacity, the previous reduction was relatively limited, and the current bottoming-out process continues, with attention to losses and official policies.

Zhuochuang Information predicts that the national market may experience a slight rise followed by a slight decline in the coming week. Regarding supply, after continuous price reductions, pig farmers have developed some resistance to further declines, and prices may rebound from low levels. However, with overall ample supply, there is limited room for continuous price increases, and the market may decline slightly again in the latter half of the week. On the demand side, there are no signs of improvement in terminal market transactions, and cautious restocking for secondary fattening is ongoing, so market demand has limited support for prices.