Pig market: China strives for stability
Pig market

China strives for stability

High prices for pork had unsettled Chinese consumers in recent years. The government now wants to avoid major fluctuations in production.
High prices for pork had unsettled Chinese consumers in recent years. The government now wants to avoid major fluctuations in production.

CHINA, Beijing. China's state government wants to curb strong fluctuations in the pig market. An early warning system is to inform about changes in the pig population.

The strong fluctuations in pig production in China in recent years, with unintended consequences for market supply and prices, are to become a thing of the past in future. With the approval of the Central Committee of the Party and the State Council, the Ministry of Agriculture in Beijing, together with other ministries, published a "Statement on Promoting the Sustainable and Healthy Development of the Pig Industry" at the beginning of August. This outlines the path to the desired stable production based on five pillars. In the first, guiding principles and requirements are defined, which include, for example, that the provinces are basically responsible for stable production; local responsibilities are to be bundled.

The pig market is to be "market-oriented", but stronger cyclical fluctuations are to be mitigated with counter-cyclical measures, such as position maintenance or stock changes. The goal is to have a high-quality pig industry with high performance, product safety and competitiveness in five to ten years, while conserving resources and the environment. For security of supply, a self-sufficiency level of at least 95 percent is targeted. In the second pillar, measures for promotion policy are to be found above all. Banks, for example, are to support the expansion of pig farming with loans and offer insurance policies or income insurance for producers.

Sow indicator becomes important

The counter-cyclical regulatory mechanisms described in the third pillar are to play a central role for stable pig production. For example, if the monthly sow population deviates by 5 percent compared to the same month of the previous year, an early warning must be given, after which either new sows are placed or underperforming animals are removed from the herd. Pig farms with more than 500 animals are to be included in the provincial monitoring system in order to better estimate production capacities.

Large farms with more than 10,000 animals must be registered nationally and must not be "illegally" demolished. If the sow herd declines more than 10 per cent compared to the previous year's level, the provinces can help large farms with one-off, temporary grants to rebuild production. In this regard, the People's Bank of China is to support local financial institutions with loans to help producers.

Data to guide the market

In order to keep an eye on production fluctuations, a fourth section of the statement calls on the provinces to set up an information platform for the entire pig value chain. Data obtained should be published in the sense of an early warning and emergency system and thus "steer" the market. Results of the monitoring of measures against animal diseases such as African swine fever (ASF) or foot-and-mouth disease (FMD) are also to be integrated into this database. Important measures to stabilise the market in the fourth pillar also include purchases and sales of pork from the state reserve and storage, which are intended to mitigate price fluctuations.

Ultimately, the further modernisation of the pig industry is the declared goal of the Beijing government. The fifth pillar includes measures, for example, to replace traditional breeding methods with modern ones on smaller farms, to promote the purchase of agricultural machinery or automatic feeding, and to optimise the slaughtering and processing of pigs. Sales as well as cooling and supply chains for pork are also to be improved so that fewer live animals are driven across the country for reasons of disease prevention.

Source: fleischwirtschaft.de; AgE
China Beijing


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