December

Original title: The price of pigs is sluggish as the Spring Festival approaches

The Lunar New Year is approaching, but the weakness of the hog market has not improved.

Recently, the sales data for December 2022 disclosed by listed companies in the hog breeding industry showed that the average sales price of commercial pigs of leading enterprises that month fell by more than 20% from November. Against the backdrop of continued sluggish pig prices, the current slaughter price of large fat pigs in some areas of the country has fallen below 14 yuan/kg.

The selling price fell month-on-month

On January 6, the main pig futures contract 2303 went down once more, closing at 15,780 yuan/ton, which has fallen by more than 25% from the high point in mid-October.

In the spot market, according to data from Baichuan Yingfu, the temperature in many places in the north and south of the country has risen significantly recently, further limiting the performance of pork demand in the terminal market, and the pig market is dominated by pessimism. On January 6, the price of live pigs across the country fell, with an average price of 15.22 yuan/kg, a drop of 1.93%.

According to data from Sozhu.com, on January 5, the national average selling price of lean meat pigs was 15.34 yuan/kg, a one-day drop of 2.54%. It was 0.36 yuan/kg lower than the 15.7 yuan/kg in the same period last year, a year-on-year drop of 2.29%. At present, the price of pigs in the northern region has generally fallen below 15 yuan/kg, and the price of large fat pigs in some low-price areas has bottomed out to below 14 yuan/kg.

The weak price of pigs in recent months can be seen from the sales data of leading listed companies in the industry.

Muyuan Co., Ltd.’s live pig sales report for December 2022 shows that the average sales price of the company’s commercial pigs in that month was 18.61 yuan/kg, a decrease of 20.23% from November 2022. In December, Muyuan Co., Ltd. sold 6.027 million live pigs (including 48,000 piglets), with sales revenue of 13.175 billion yuan. Among them, a total of 945,000 live pigs were sold to Muyuan Meat Food Co., Ltd., a wholly-owned subsidiary, and its subsidiaries.

The data disclosed by Tianbang shares also shows that in December 2022, the company sold 483,800 commercial pigs (including 127,900 piglets), with sales revenue of 890 million yuan and an average sales price of 19.98 yuan/kg (the average price of commercial fat pigs was 19.35 yuan). Yuan/kg), the month-on-month changes were 5.12%, -13.72%, and -20.41%, respectively.

Although the overall domestic pig price rose sharply in the third quarter of 2022, the annual average sales price of Tianbang shares was not as high as that in 2021.

From January to December 2022, Tianbang Co., Ltd. sold 4.4215 million commercial pigs (including 641,600 piglets), with a sales revenue of 8.731 billion yuan and an average sales price of 18.35 yuan/kg (the average price of commercial fat pigs was 18.1 yuan/kg) , and the year-on-year changes were 3.31%, 1.84%, and -0.17%, respectively.

The announcement of Dongrui shares shows that in December 2022, the average sales price of the company’s commercial pigs is 24.47 yuan/kg, a month-on-month decrease of 10.08%. In the month, the company sold a total of 47,800 live pigs, and the sales revenue was 114 million yuan, a decrease of 23.04% from the previous month. From January to December 2022, Dongrui Co., Ltd.’s sales revenue of live pigs was 1.161 billion yuan, and the average sales price of commercial pigs was 23.78 yuan/kg, with year-on-year changes of 23.18% and -14.38% respectively.

Subsequent upward momentum is insufficient

From 2018 to 2022, the domestic hog market will go through a complete hog cycle. Although 2022 is the year when the pig cycle is reversed, the price of pigs throughout the year has declined year-on-year.

At the beginning of 2022, the trading price of live pigs continued the downward trend at the end of 2021, but the decline gradually narrowed. It bottomed out in March and rebounded, starting an upward cycle. Driven by multiple factors, the price of pigs will continue to rise from March to October 2022, and the national average price in October will break through the mark of 26 yuan/kg. However, in the fourth quarter, the imbalance between supply and demand intensified, and the price of pigs continued to decline due to the dual disadvantages of the group’s pig farms’ sprint annual plan and the peak season.

According to data from Zhuo Chuang Information, as of December 30, 2022, the annual average transaction price of China Foreign Sanyuan is 18.6 yuan/kg, a year-on-year decrease of 6.39%.

Regarding the reasons for the trend of the live pig market price in 2022, Zhuo Chuang analyst Li Sujie believes that the trend of live pig prices is mainly caused by the pattern of supply and demand. The number of fertile sows on the supply side is the decisive indicator, while the slaughter volume and operating rate on the demand side are direct indicators. . After the stock of reproductive sows reached a phased low at the end of the first quarter of 2022, the price of pigs bottomed out and the breeding profit gradually picked up. The breeding end began to actively replenish the stock, and the stock of reproductive sows continued to increase. As of the end of November 2022, the number of fertile sows in 166 sample companies monitored by Zhuo Chuang Information was 6.0168 million, an increase of 3.59% month-on-month and a year-on-year increase of 17.4%.

In 2022, the slaughtering volume and operating rate of slaughtering enterprises will mainly fluctuate and decline, and will rebound at the end of the year. The demand for the Spring Festival at the beginning of the year was pre-empted, and pork orders increased. The average daily slaughter volume in January was the highest in the year, reaching 226,900 head, and the operating rate was 36.17%. The rapid increase in raw material costs in the third and fourth quarters led to poor sales of downstream white strips, and the slaughter volume and operating rate fluctuated and declined. There was a periodic increase in December, and October reached the lowest point of the year. The boost of pickled meat and sausages was not as expected. ” feature is more prominent.

For the market outlook, Ruida Futures analyzed that following New Year’s Day, demand inertia will drop, and the epidemic is at its peak, residents’ consumption sentiment is bleak, and demand has not been effectively boosted, but the market has expectations for improvement in consumer demand in the later period. The spot price is expected to adjust weakly, but the current pig price is too low, and the market has expectations that the price will rebound, leading to a rebound in futures prices.

Changjiang Futures believes that this year’s Spring Festival is earlier, large-scale farms are actively speeding up their slaughtering plans, and some of the large-scale pigs from retail investors have not been exhausted. As the bullish sentiment weakens, the pace of slaughtering will speed up, and the pressure on slaughtering remains unabated. It will still take time for demand to recover. Coupled with the economic downturn and the decline in residents’ income, as well as the low price-performance ratio of pork, the boost to demand is limited. The upward momentum of pig prices is insufficient, and the overall pressure is on. (Reporter Zhao Liyun）