Pork prices fell for 4 consecutive months, has the "super pig cycle" passed...

The average price of white striped pork in major national wholesale markets is 27.
43 yuan per kilogram, and the wholesale price of white striped pork in Beijing Xinfadi is 11.
5 yuan per catty.
The last time I could buy a catty of pork for less than 30 yuan was two years ago
.

According to data from the Ministry of Agriculture and Rural Affairs, since January this year, the wholesale transaction price of white striped pork has fallen for four consecutive months.

Pig prices fell for 4 consecutive months, close to the same period two years ago

"A elbow is two and a half catties, count you 29 yuan and 5.

" On May 27, in a vegetable shop near East Tiejiangying, Fengtai District, Beijing, people buying vegetables unhurriedly bargained with vendors, wanting to make a difference.

Erase

According to data from the Ministry of Agriculture and Rural Affairs, throughout 2020, the wholesale price of white striped pork has been fluctuating between 40 yuan and 50 yuan per kilogram.
In January of this year, the price of pork per kilogram remained at 46.
71 yuan, but after a while.
In September, the price went all the way down.
As of two weeks ago, the price of pork had fallen below 30 yuan, falling for four consecutive months
.

Pork price fluctuations are not unprecedented, but this round of pork price changes has indeed received the most attention
.

Since the 1990s, the price of live pigs has experienced cyclical fluctuations every three to four years.
This is an economic phenomenon that exists in bulk commodities and is called the "hog cycle" in the industry
.

In fact, the last round of the pig cycle started in March 2015, and due to the impact of the African swine fever epidemic, the arrival of the pig cycle was brought forward, making the pig cycle extremely long and setting the current round of pig cycle.

The pig price has not yet fallen to the lowest point of the cycle

In the opinion of experts, the start time of this round of pig cycle should start from May 2018, when pork prices began to rise.
"Until August 2020, this is the stage where pork prices are gradually rising, although there are some steps in the process.
Ups and downs, but the overall trend is upward
.

After August that year, prices began to fall

"Of course, seasonal fluctuations will also occur in the down cycle
.

" Zhu Zengyong, a researcher at the Beijing Institute of Animal Husbandry and Veterinary Medicine, Chinese Academy of Agricultural Sciences, said that under the premise that production capacity returns to normal, although there will be a short-term rebound with seasonal changes in slaughter volume, However, it does not have the conditions to reverse the downward trend of pig prices

According to Zhu Zengyong, the low point of the price of the pig cycle is generally at the stage of about 20% below the cost line.
According to current data, after four consecutive months of decline, the price of pork is still in the down cycle and has not yet reached the cycle low
.

However, Zhu Zengyong also said that there will not be much room for decline in the future

Increase the level of scale to "stretch" the pig cycle

"The pig cycle generally lasts for three years.
Before 2007, the pig cycle experienced by our country was relatively stable, with prices basically rising for one year, stabilizing for one year, and falling for one year
.

" Mentioned the reasons for this "super pig cycle", Zhu Zengyong said that as a kind of agricultural product, pork has its own periodicity and market rules.

Zhu Zengyong first mentioned the "blessing" of large-scale breeding for the pig cycle
.

"Before 2007, retail and small and medium-sized operators in this industry were the main force.

He further explained that once the pig cycle time was short, it was because the operators, mainly small and medium retail investors, were sensitive to market prices, and rapid adjustments in production would quickly affect the market, while large-scale breeding entities faced changes in market prices.
The adjustment of production arrangements will also focus on stability, and the time for production adjustments to affect the market has been
extended horizontally.
" The result of the increase in scale is that the fluctuation of pork prices has gradually stabilized .
" Zhu Zengyong said, such as All agricultural products are affected by seasonal changes.
The pig cycle itself is not a "problem.
" "The drastic fluctuations in pork prices are not caused by the pig cycle itself, but diseases and other factors that have led to a rapid and substantial drop in pig production capacity in the short term and a rise in pig prices Under the asymmetric information, the breeding subjects irrationally fill up the fence and blindly expand production, which leads to the excessive growth of production capacity
.
"

Trading volume of white strip pork wholesale market
.
Data source: Information Center of the Ministry of Agriculture and Rural Affairs

Diversification issues exacerbate price fluctuations in this round of pig cycle

"The large price fluctuations are caused by the superposition of diversification problems
.
" Zhu Zengyong said that relative to the impact of increased production stability brought about by large-scale production, epidemics, environmental protection policies, and excessive pork imports have caused the price of this round of pig cycle.
The ups and downs intensified
.

First of all, the disease is the direct cause of the decline in pig production capacity
.
"Once the commercialization rate of commercialized livestock and poultry increases, the incidence of major diseases will increase
.
" Zhu Zengyong mentioned that under the premise of high breeding density, imported pigs from outside will indeed bring the risk of disease transmission.
Including African swine fever, blue-ear disease and epidemic diarrhea can directly affect production, leading to a rapid decline in production in a short period of time
.

"Then there are changes in environmental protection policies
.
When our large-scale aquaculture reaches a certain level, environmental problems will be addressed and resolved sooner or later
.
" In fact, five or six years ago, local mechanized implementation of environmental protection policies "one size fits all" , Which also led to the closure of a large number of pig farms, especially in the south, and a significant drop in pig production capacity in the short term
.

At the same time, Zhu Zengyong also mentioned the impact of pork trade on the domestic market
.
He said that in the previous years of 2013 and 2014, when China's live pig production capacity was overcapacity, the import volume was relatively high, which also led to the lengthening of the pork down cycle and the long-term downturn in pig prices
.
The superposition of multiple factors has accelerated the exit speed of early retail investors after facing the epidemic and policy changes.
"This speed is higher than the increase in the breeding capacity of the large-scale level in the short term, and it also exacerbates the fluctuation of pig prices in the pig cycle
.
In 2020, China The proportion of farmers with more than 500 heads for slaughter has reached 57%, and the production stability has been significantly improved.
The effective prevention and control of African swine fever, the controllable management of breeding costs, scientific and reasonable decision-making on pig production, and the appropriate degree of pork import will be improved.
It will affect the pig price stability in the second half of the pig cycle
.
"