Pork: China replenishes reserves
Pork

China replenishes reserves

Imago / VCG
Employees pack pork at a meat plant of Liaoning Qianxihe Foodstuff in Shenyang.
Employees pack pork at a meat plant of Liaoning Qianxihe Foodstuff in Shenyang.

CHINA, Beijing. The sharp drop in pig market prices in China has led to initial market support measures. Piglet prices continue to fall.

According to the responsible government agency, a start was made last week on removing 20,000 t of pork from the market and transferring it to the central reserve warehouse. Previously, due to the collapse in the price of slaughter pigs and the unfavorable relationship with feed costs, warning levels necessary for this purpose had already been triggered.

The main goal of the macro control measures is to prevent large volatilities and avoid high prices from harming consumers and low prices from harming farmers, Ministry of Commerce spokesman Gao Feng explained to the press. He expressed optimism that the stockpiling tool and other measures can stabilize pig prices in the second half of the year.

In fact, the low point in slaughter pig prices in the People's Republic seems to be over. This was reached on June 21 with a nationwide average price of CNY 12.48 (€ 1.63) per kilogram live weight (LG). Following the announcement of countermeasures by the government, the producer price was able to firm up again somewhat and stood at CNY 16.05/kg (€ 2.09) last Thursday. Exactly one year ago, it had been more than twice as much at CNY 37.25/kg (€ 4.98).

Stock prices recovering only slowly

At the moment, it also does not look as if slaughter pig prices will rise sharply in the second half of the year. Although futures prices on the live pig futures market at the Dalian Commodity Exchange (DCE) have also bottomed out, the settlement price for the September contract was recently only moderately higher than the current spot market price at CNY 18,760/t (€ 2,448).

The November future was settled last Thursday at CNY 18,100/t (€ 2,362). No all-clear can be given at all so far for piglet prices in China, which are still falling. According to the latest survey, the price per kilogram for a 20 kg animal was CNY 27.68 (€ 3.61); this was 72% lower than at the beginning of July 2020.

Source: fleischwirtschaft.de; AgE
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