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    Home > Food News > Food Articles > Production capacity cuts pig prices or opens an "upward channel"

    Production capacity cuts pig prices or opens an "upward channel"

    • Last Update: 2022-05-26
    • Source: Internet
    • Author: User
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    Since the price of live pigs continued to fall in the second quarter of last year, the supply of live pigs has always been relatively loose, and the price of live pigs has remained sluggish


    Judging from the current situation, the number of breeding sows at the end of the first quarter was only 850,000 more than normal


    The arrival of a new round of pig cycle does not mean that the price of live pigs will definitely enter the range of "big ups and downs" again


    Guan Ziru 

    In the past few days, the price of live pigs has risen rapidly, and the spot market is full of "recovery"


    Behind the strength of the market is the increasingly reasonable production capacity of live pigs


    Spot, futures, stock price "full rise"

    After the Spring Festival, the price of live pigs is always below the breeding cost line


    According to the analysis of CITIC Futures, the stock of live pigs rose, which is expected to drive futures to rise sharply


    "The long-term sluggish pig price has made the market have a certain emotional accumulation


    According to industry analysts, in March and April this year, the country launched four rounds of purchase and storage


    At present, the emergence of the epidemic in some areas has increased the willingness of some businesses and residents to store and hoard meat, which has stimulated pork consumption to a certain extent


    Industry insiders pointed out that the epidemic will bring about a certain degree of regional supply imbalance


    "The upcoming International Labor Day and Dragon Boat Festival will have some positive effects on the live pig market


    Pig prices will not soar rapidly

    According to industry analysis, the price of live pigs cannot be in an excessively falling range for a long time, and the trend of recovery is more obvious


    Meng Wei, a spokesman for the National Development and Reform Commission, said at a press conference on the 19th that the production capacity of breeding sows is generally reasonable, and it is unlikely that the price of live pigs will rise sharply after bottoming out in the later period


    At the end of the first quarter, there were 422.


    Wei Xin said that from the current situation, the number of breeding sows at the end of the first quarter was only 850,000 more than the normal number


    The change in the number of breeding sows is the result of the game between production capacity and price
    .

    The reporter combed and found that the sales volume of live pigs of Muyuan Co.
    , Ltd.
    in March was 5.
    986 million, which was slightly higher than that in the fourth quarter of 2021; the sales volume of live pigs of Tianbang Co.
    , Ltd.
    in March was 336,200, which was slightly lower than that of 2021.
    In the fourth quarter of the year, Dabeinong sold 373,900 live pigs in March, a month-on-month increase of 33.
    06%
    .

    Cash flow remains an important consideration

    The relevant person in charge of New Hope said that the company will make many adjustments in the pig industry in 2021, including the rapid transition from the stage of scale expansion to the stage of stability, and the suspension of purchased piglets and purchased sows
    .
    At the same time, optimize and adjust production capacity to increase the full load rate of pig farms in operation
    .
    Muyuan shares also made similar moves in the second half of 2021, reducing related investments such as plant construction
    .

    According to industry analysts, every pig is consuming capital, so stable cash flow is an important factor for pig breeding companies to consider
    .
    In this round of pig cycle, companies such as Muyuan and New Hope have ushered in substantial expansion; at the bottom of the price of this round of pig cycle, companies that have not expanded before or have a relatively small expansion have ushered in opportunities
    .
    In the future rising channel of pig prices, some companies with better cash flow and foundation will have the opportunity to achieve rapid development
    .

    "We think this round of pig cycle is coming to an end
    .
    " Wei Xin said that since the price of live pigs fell last year, this round of pig cycle has entered the "second half"
    .
    With the bottoming out of live pig prices and the reduction of production capacity, a new round of pig cycle will come
    .

    Industry insiders said that the arrival of a new round of pig cycle does not mean that the price of live pigs will definitely enter the "big rise and fall" range again
    .
    In this round of pig cycle, the past dominance of free-range pig farming has been partially replaced by large-scale farms, and some pig farming enterprises are also expanding their scale
    .
    The next round of pig cycle may become the adjustment and optimization of the internal structure of large-scale breeding enterprises and farms
    .

    "The listing of live pig futures will also have a weakening effect on the price fluctuations of live pigs
    .
    " Yang Xiaoxia said that with the increasing maturity of live pig futures, it will better play a counter-cyclical adjustment role and reduce the frequency of large fluctuations in live pig prices to a certain extent
    .

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