After a short fall, pork prices have risen again. According to statistics, pork prices have been rising for a month, with the price of live pigs rising by 6 yuan/kg from an average price of 29 yuan/kg at the end of November 2020 to 35 yuan/kg today. Officials say it’s because of positive virus tests for imported frozen meat, which has made the public dare to buy only fresh meat, widening the supply gap.
In December 2020, China’s hog prices once again approached their highest point.
According to the data monitoring of the pig price system of China Pig Network, on December 31, 2020, the national average price of live pigs was 35.67 yuan/kg, reaching the highest point of pig prices for the third time.
According to the data from the Ministry of Agriculture and rural Affairs, in February 2020, the price of live pigs exceeded RMB 38/kg, after which it fell back briefly; in July 2020, the price of live pigs approached RMB 38/kg again. This is the third time in a year that the price has approached the RMB 38/kg mark.
Not long ago, China’s Ministry of Agriculture and Rural Affairs just released information that by the end of November 2020, the national pig stock and breeding sow stock had both recovered to more than 90% of their usual levels. But pig and meat prices are still drifting up, so what is wrong?
According to Brokerage China, in 2020, China’s domestic hog prices continued to be high and had to rely on massive imports of foreign frozen meat to make up for domestic demand.
Statistics show that as of November 2020, the amount of domestic imports of pork at positive customs was over 4 million tons, with imports mainly from the European Union, South America, the U.S., etc. Imports arriving in December were around 100,000 tons, and pork imports for the year were 4.2 to 4.3 million tons.
However, since November 2020, Wuhan pneumonia virus has been detected on imported frozen meat in more than a dozen provinces and regions across the country.
In November 2020, Beijing authorities issued technical guidelines regarding virus prevention and disinfection during the production and operation of cold-chain foods, requiring all regions to strengthen testing of frozen products, with a significant increase in the number of positive results.
On December 1, 2020, the General Administration of Market Supervision held a teleconference on strengthening the traceability management of imported cold chain food, pointing out that “strictly imported cold chain food from the port to the territory of production, circulation, sales throughout the prevention and control, no inspection and quarantine certificate, no nucleic acid test report, no disinfection certificate, no traceability information, shall not be marketed and sold.”
The positive reports of imported pork tests made the public worry and turn to buy only fresh pork, which further widened the domestic supply gap and became an important reason for the rise in hog prices.
So, will this wave of increase continue into 2021? Experts generally believe that without major epidemics, diseases and policy changes, the release of production capacity will accelerate in the second half of 2021, and hog prices may show an overall downward trend, with national hog prices expected to be 21.5 to 22.5 yuan/kg by September 2021.
Li Weifeng, chairman of Guangdong Agricultural Industry Fund and general manager of Guangdong Innovation Center of New Hope Sixth Harmony Co., Ltd, said that compared with the sky-high price in 2020, without a major epidemic, the price of hogs will enter a downward channel in 2021, and a low price is highly likely in 2022. And when the pig price drops, many enterprises from other industries such as real estate to invest in pig farming may leave the farm halfway, and some people will not rule out selling pig farms at half price by 2022.
In 2020, the sky-rocketing pig price market made the listed enterprises in pig farming industry earn a lot of money, and they are all busy expanding their production capacity and supporting their “money bags”. E-commerce giants, real estate bigwigs have turned to pig farming industry almost without pulling one.
Capacity expansion has increased the supply of pigs, but also let the outside world for the decline in pig prices have more advance expectations.
However, netizens said that once the pig price is controlled by capital, it is difficult to come down again. “Look at the price increase of various items, you know that inflation is coming.” Many netizens lamented that eating the world’s most expensive pork, living in the world’s most expensive house and receiving the world’s most expensive education, “(they) are not serving the people, there is only one goal: money!”
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