Editor’s Note
This article provides a snapshot of recent price movements in China’s hog market, highlighting a notable decline in futures alongside regional variations in spot prices. The data illustrates the dynamic relationship between futures contracts and on-the-ground commodity values.
In the futures market, the closing price for the Live Hog 2601 contract yesterday was 11,880 yuan/ton, a change of -305.00 yuan/ton or -2.50% from the previous trading day. In the spot market, the price for ternary hybrid hogs in Henan was 12.49 yuan/kg, a change of -0.14 yuan/kg from the previous day, with a spot basis of LH01+610, a change of +165. In Jiangsu, the price was 12.71 yuan/kg, a change of -0.05 yuan/kg, with a spot basis of LH01+830, a change of +255. In Sichuan, the price was 12.30 yuan/kg, a change of -0.03 yuan/kg, with a spot basis of LH01+420, a change of +275.
According to monitoring by the Ministry of Agriculture and Rural Affairs, on October 30, the “Agricultural Product Wholesale Price 200 Index” was 124.64, up 0.34 points from yesterday. The “Basket of Products” wholesale price index was 126.59, up 0.43 points from yesterday. The national average wholesale price for pork in agricultural product markets was 17.96 yuan/kg, down 0.4% from yesterday; beef was 66.28 yuan/kg, unchanged from yesterday; mutton was 62.13 yuan/kg, down 0.4% from yesterday; eggs were 7.35 yuan/kg, down 0.3% from yesterday; and dressed chicken was 17.55 yuan/kg, up 0.8% from yesterday.
Overall, sentiment for secondary fattening remains relatively strong. However, secondary fattening is part of the hog reproduction process; it does not change the total market supply and will lead to a further increase in hog supply several months later. Currently, secondary fattening is mainly undertaken by small-scale farmers, who tend to raise heavier hogs. This directly highlights the issue of delayed hog supply. In the short term, hog prices remain relatively firm under the influence of secondary fattening. However, the medium- to long-term supply-demand structure has not changed, and future slaughter pressure remains high. It is still necessary to closely monitor changes in secondary fattening and production capacity.
Cautiously bearish.
