Chinese pork price down despite shrinking herd

China's pork production fell by 2024% in the third quarter of 0,8 compared to the same period in 2023. In absolute terms, pork production fell by 12,6 million tonnes. This is a sharper decline than in the second quarter, when production fell by 0,4% to 14 million tonnes.

In the first three months of the year, pork production decreased by 1,4%. Total volumes decreased to 42,4 million tonnes. The slaughtering rate decreased more sharply. A total of 520,3 million pigs were slaughtered. The pig population decreased even more sharply. At the end of September, the number of Chinese pigs appeared to have decreased by 3,5% to 426,9 million pigs.

Intervention
The decline in production is directly related to the keuze earlier this year to intervene. Until early this spring, the Chinese pig market reached a price level where Chinese pig farmers could not make a profit. Therefore, China decided to reduce the sow herd from 41 million to 39 million sows. Effectively, the fattening pig herd will decrease by approximately 22 million pigs. This policy proved to be quite successful immediately. The sow herd has already been reduced to below 40 million pigs.

Weak market
Despite the lower supply, the Chinese market is in a minor mood again. Although the supply of pork has decreased significantly, the market has not become tighter. The Chinese demand for pork has clearly dipped. This can partly be attributed to a structural decline in Chinese demand. The Chinese meat preference has changed considerably in recent years. Particularly in the city, the eating pattern is diversifying, which is increasing the popularity of chicken and beef. Especially the fatty pork that is popular in China is losing popularity due to the increase in obesity.

For the most part, however, the weaker demand is related to the struggling Chinese economy. China has been struggling all year. The country aims to grow the economy by 5% this year. That seems like a lot of growth, but not so long ago, the Chinese growth rate was above 10% annually. In the third quarter, the economy grew by only 4,6%. In addition, youth unemployment remains high. According to the latest available data, youth unemployment has risen from 13,2% in September to 17,6%. The weak economy is causing many Chinese to choose to cut back on their food. In addition, consumption in the hospitality industry is declining, which means that less meat is being eaten.