Original title: The price of pigs is slow as the Spring Festival approaches
The Lunar New Year is approaching, but the weakness in the pig market has not improved.
Recently, sales data for December 2022 disclosed by listed companies in the pig farming industry showed that the average sales price of commercial pigs of major companies in that month decreased by more than 20% compared to November. Against the background of the continuous decline in pig prices, the current slaughter price of large fat pigs in some areas of the country has fallen below 14 yuan/kg.
The sale price has decreased from month to month
On January 6, the major hog futures contract 2303 fell again, closing at 15,780 yuan/ton, which is down more than 25% from its mid-October high.
In the spot market, according to data from Baichuan Yingfu, the temperature in many places in the north and south of the country has risen significantly recently, further constraining the performance of pork demand in the terminal market and the pig market it is dominated by pessimism. On January 6, the price of live pigs across the country decreased, with an average price of 15.22 yuan / kg, a decline of 1.93%.
According to data from Sozhu.com, on January 5, the national average selling price of lean pork was 15.34 yuan/kg, a daily decline of 2.54%, 0.36 yuan/kg lower than the 15.7 yuan / kg of the same period last year, a year on year decline of 2.29%. At present, the price of pigs in the northern region has generally dropped below 15 yuan/kg, and the price of large fat pigs in some low-price areas has dropped below 14 yuan/kg.
The weakness in the price of pigs in recent months can be seen in the sales data of the main listed companies in the sector.
Muyuan Co., Ltd.’s live pig sales report for December 2022 shows that the company’s average commercial pig sales price in that month was 18.61 yuan/kg, a decline of 20.23% compared to November 2022. In December, Muyuan Co., Ltd. sold 6.027 million live pigs (including 48,000 piglets), with sales of 13.175 billion yuan. Among them, a total of 945,000 live pigs were sold to Muyuan Meat Food Co., Ltd., a wholly owned subsidiary, and its subsidiaries.
The data disclosed by Tianbang shares also shows that in December 2022, the company sold 483,800 commercial pigs (including 127,900 piglets), with a turnover of 890 million yuan and an average selling price of 19.98 yuan/kg (the average price of commercial fat pigs was 19.35 yuan).
Although the overall price of domestic pigs increased significantly in the third quarter of 2022, the average annual selling price of Tianbang shares has not been as high as it was in 2021.
From January to December 2022, Tianbang Co., Ltd. sold 4.4215 million commercial pigs (including 641,600 piglets), with a turnover of 8.731 billion yuan and an average selling price of 18.35 yuan/kg (the average price of commercial fat pigs was 18.1 yuan/kg), and the year-on-year changes were 3.31%, 1.84% and -0.17%, respectively.
The Dongrui stock announcement shows that in December 2022, the company’s commercial pig average selling price is 24.47 yuan/kg, a monthly decline of 10.08%. In the month, the company sold a total of 47,800 live pigs and revenue was 114 million yuan, down 23.04% from the previous month. From January to December 2022, the sales turnover of live pigs of Dongrui Co., Ltd. was 1.161 billion yuan, and the average sales price of commercial pigs was 23.78 yuan/kg, with changes on a basis annual rate of 23.18% and – 14.38% respectively.
The subsequent upward momentum is insufficient
From 2018 to 2022, the domestic pig market will go through a complete pig cycle. Although 2022 is the year that the hog cycle reverses, the price of hogs throughout the year has been declining year on year.
In early 2022, the trading price of live pigs continued the downward trend in late 2021, but the decline gradually narrowed, bottoming out in March and rebounding, starting an upward cycle. Driven by multiple factors, the price of pigs will continue to rise from March to October 2022, and the national average price in October will exceed the 26 yuan/kg threshold. However, in the fourth quarter, the imbalance between supply and demand intensified, and the pig price continued to decline due to the dual disadvantage of the group’s pig farms’ annual sprint plan and the high season.
According to data from Zhuo Chuang Information, as of December 30, 2022, the average annual transaction price of China Foreign Sanyuan is 18.6 yuan/kg, down 6.39% year on year.
As for the reasons for the market price trend of live pigs in 2022, Zhuo Chuang analyst Li Sujie believes that the price trend of live pigs is mainly caused by the trend of supply and demand. number of fertile sows on the supply side is a decisive indicator, while slaughter volume and operation rate on the demand side are direct indicators. After the stock of breeding sows reached a gradual low at the end of the first quarter of 2022, the price of pigs bottomed out and the profit of the farm gradually increased. The end of the farm began to actively replenish the stock and the stock of breeding sows continued to increase. At the end of November 2022, the number of fertile sows in 166 sample farms monitored by Zhuo Chuang Information was 6.0168 million, an increase of 3.59% month over month and a year over year increase of 17.4%.
In 2022, the slaughter volume and operating rate of slaughterhouse enterprises will mainly fluctuate and decrease, and then recover at the end of the year. Demand for the Spring Festival earlier in the year was anticipated and pork orders increased. The average daily slaughter volume in January was the highest of the year, reaching 226,900 head, and the rate operational was 36.17%. The rapid increase in raw material costs in the third and fourth quarters led to poor sales of downstream white stripe, and the slaughter volume and operating rate fluctuated and decreased. There was a gradual increase in December and reached the lowest point of the year in October “Features are more important.
As for the market outlook, Ruida Futures analyzed that after the first of the year, the demand inertia will decrease and the epidemic is at its peak, the consumption sentiment of residents is gloomy, and the demand has not been effectively boosted , but the market has expectations of improvement in consumer demand in the subsequent period. The spot price is expected to adjust weakly, but the current hog price is too low, and the market expects the price to rebound, leading to a rebound in futures prices.
Changjiang Futures believes that this year’s Spring Festival is early, large-scale agricultural enterprises are actively accelerating their slaughter plans, and some of the heavy pigs of retail investors have not been sold out. accelerate and the pressure on the slaughter remains unabated. It will still take some time for demand to recover. Coupled with the economic downturn and falling income of residents, as well as the low price-quality ratio of pork, the increase in demand is limited. The upward momentum in pig prices is insufficient, and the overall pressure is under pressure. (Reporter Zhao Liyun）
