Pork price has kept sliding since April. The current hog price averages RMB15.74/kg and pork wholesale price RMB21.73/kg, down 8.14% and 4.41% respectively from early April. BOABC finds the following responsible for the price decline:
First, hog inventory underwent rapid expansion in medium and large hog farms, though farming households’ hog inventory remains low. Hog delivery to the market has increased respectively.
Second, pork consumption has dropped 5% recently due to the current high price, giving rise to a market surplus.
Third, owing to concentrated hog sales before May Day, slaughterhouses were able to bargain with hog suppliers.
Fourth, pork consumption wanes with the coming of summer, curtailing slaughterhouses’ hog procurement, resulting in a hog price decline.
However, as hog farms’ supplement of piglets to pigsties was hindered by snowstorms in Feb., there will be a shortage of hogs for slaughter during July and Aug. So, pork price is presumed to pick up in July and Aug.
