Chinese pig price rises to 3 euros per kilo

It must be stated that 'the Chinese pork price' does not actually exist. Pig prices are determined per province and therefore considerable differences are visible. All prices together then result in a national average.

Record already exceeded locally
The record national average dates from June 2016, when pig prices rose due to the operation of the pig cycle. The Chinese pig price then peaked at 20,80 Chinese yuan per kilo (live weight). This is converted to €2,65 per kilo. This level is not far away at the beginning of August. Pig prices in China have increased June and July namely showing a significant increase, after much ground had already been gained in the months of February and March. In between, in April and May, prices moved relatively flat.

The national pig price in China was 3 yuan per kilo (€19,23) on Saturday, August 2,45. However, in the south of China, prices are many times higher. In the autonomous region of Guangxi, which is located in the far south of the country, the pig price has already risen to 23,86 yuan per kilo (€3,04). The price is also higher than the national average in surrounding southern provinces. The south of China is the 'epicenter' of the pig sector, both in production and consumption.

Further increase in prospect
Based on the seasonal pattern, it can be said that prices will rise until mid-September. The question, however, is to what extent there is a seasonal pattern this year, given that China is being hit hard by outbreaks of African swine fever this year; Meanwhile, more than 140 outbreaks have been officially reported by the authorities.

The most recent pig herd count (June) shows that there are 25,8% fewer pigs than in the same period last year. However, slaughter figures in China suggest that the 'real shortage' is yet to come. The figures fell by 'only' 5% in the same period. The figures probably remained reasonably stable because many 'backyard farmers' have culled the pigs preventively in recent months to avoid an outbreak.

Expensive pork
Chinese consumers are currently complaining that pork has become too expensive. Although China is introducing massive beef and poultry (as an alternative to pork) imports, this will not solve the pork shortage. There is no insight into the growth of the pig herd and any recovery will also take a long time.

Estimated by the World Food Organization FAO it will take at least 5 years before production returns to its previous level. This makes a further increase in pig prices very likely. This means it is only a matter of time before the national pork price breaks the 2016 record, as predicted by Rabobank.