Interview with Zhu Zengyong: This super "pig cycle" has these characteristics

Since the beginning of this year, the price of pigs has fallen sharply, which has caught the entire pig industry by surprise.
Listed pig companies have suffered substantial losses in the third quarter
.
Since 2003, the Chinese pig industry has experienced four complete "pig cycles" and the current round of "pig cycles" that is currently in progress

On October 18, at the 2nd Southwest Pig Raising Conference and Building Pig Raising Summit Forum in 2021, Zhu Zengyong, chief analyst for monitoring and early warning of the whole pork industry chain of the Ministry of Agriculture and Rural Affairs, said in an exclusive interview with China Business News that this round of "pig cycle" Triggered by the African swine fever epidemic, it has characteristics that are quite different from other cycles

Features of the fifth round of "pig cycle"XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

The five "pig cycles" since 2003 are June 2003-May 2006, June 2006-June 2009, June 2009-April 2014, and May 2014-2018 May and June 2018 to present

The pig price in the fifth round of "pig cycle" has a greater amplitude, and the high point of the pig price is much higher than the previous cycles
.
The combination of the pig epidemic and environmental protection prohibition caused a decline in production and triggered a sharp increase in prices

XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

Pig cycle pork price trend since 2003, data source: Ministry of Agriculture and Rural AffairsXiL China Feed Industry Information Network-Based on feed, serving animal husbandry

This "pig cycle" has entered a downward cycle starting in September 2020

The price of pigs will rise and fall, making the pig industry a little confused

Zhu Zengyong said that the development of speculative psychology originated after August 2019 and until the beginning of the second quarter of 2021, pig prices remained at a relatively high level

He said that for the pig industry, the effectiveness of government statistics is gradually improving.

For farmers and aquaculture enterprises, after experiencing market changes in the first half of 2021, they realize the validity and objectivity of official statistics
.
However, there are also problems in the understanding of the pig price cycle by the breeding entities
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

"They all have their own logic.
After this super'pig cycle', their mentality has become uneasy, and they all want to seize the cycle of rising pig prices
.
However, the companies that really do it are precisely able to recognize the future industrial situation.
, A company that has the courage to do things
.
Taking this round of pig price increases as an example, the best time to replenish slaughter and expand production should be in the first half of 2019.
At that time, pig prices were fluctuating between the cost line and the southern region was suffering from Africa.
The impact of the swine fever epidemic
.
" Zhu Zengyong said
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　What impactXiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　In this round of "pig cycle", the regionalization and large-scale characteristics of the pig industry are also more significant
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Zhu Zengyong said that the advantages of resource endowments such as feed and land, environmental pressures, and the regional prevention and control of African swine fever and other policy factors have led to more obvious characteristics of the clustering of pig production areas
.
Among them, the status of pig breeding in the southwest and northeast regions has gradually emerged
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　From the perspective of epidemic prevention and control and production capacity control measures, in this round of "pig cycle", the government has also taken different measures from the past
.
For example, to carry out the regional prevention and control of major animal diseases such as African swine fever, from the pilot project in the central and southern region in 2019 to May 1, 2021, nationwide
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　More importantly, in September this year, the Ministry of Agriculture and Rural Affairs formulated the "Implementation Plan for Regulation and Control of Pig Production Capacity (Interim)".
37 million head" control target
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Zhu Zengyong said that the setting of control targets has filled the policy gap of counter-cyclical control from the production side.
The previous control policies were introduced when the price of pigs rose.
The main purpose of the introduction was to stimulate the enthusiasm of farmers, but the pig raising cycle It is relatively long, and it is often difficult to control the intensity.
When stimulating production, it is likely to bury hidden dangers for the next round of overcapacity
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

China's pork imports since 2000XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　At the same time, there will be a breakthrough in pork imports in each round of the "pig cycle"
.
In this "pig cycle", pork imports will reach 4.
39 million tons in 2020
.
Before 2019, pork imports accounted for less than 4% of domestic pork production, and by 2020 this proportion will reach 10.
7%
.
With the improvement of domestic and international pork market linkage, pork import trade may extend the pig cycle time in the future
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

 　　Since the beginning of this year, the price of pigs has fallen sharply, which has caught the entire pig industry by surprise.
Listed pig companies have suffered substantial losses in the third quarter
.
Since 2003, the Chinese pig industry has experienced four complete "pig cycles" and the current round of "pig cycles" that is currently in progress
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　On October 18, at the 2nd Southwest Pig Raising Conference and Building Pig Raising Summit Forum in 2021, Zhu Zengyong, chief analyst for monitoring and early warning of the whole pork industry chain of the Ministry of Agriculture and Rural Affairs, said in an exclusive interview with China Business News that this round of "pig cycle" Triggered by the African swine fever epidemic, it has characteristics that are quite different from other cycles
.
The cyclical fluctuation of pig prices is a normal economic phenomenon in the market economy.
Its impact on the stability of the industry and the market is not cyclical fluctuations, but whether the fluctuation range of pig prices exceeds a reasonable range
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Features of the fifth round of "pig cycle"XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　The five "pig cycles" since 2003 are June 2003-May 2006, June 2006-June 2009, June 2009-April 2014, and May 2014-2018 May and June 2018 to present
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　The pig price in the fifth round of "pig cycle" has a greater amplitude, and the high point of the pig price is much higher than the previous cycles
.
The combination of the pig epidemic and environmental protection prohibition caused a decline in production and triggered a sharp increase in prices
.
The stock of reproductive sows in September 2019 decreased by 38.
9% year-on-year.
The previous largest decline occurred in March 2015, at 15.
6%
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

Pig cycle pork price trend since 2003, data source: Ministry of Agriculture and Rural AffairsXiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　This "pig cycle" has entered a downward cycle starting in September 2020
.
However, the high pig price remained until the beginning of the second quarter of 2021 before it began to fall sharply
.
Although the current pig price is still showing an overall downward trend, affected by the two rounds of central frozen pork purchasing and storage in 2021, pig prices rebounded slightly at the end of June and after October 7 respectively
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　The price of pigs will rise and fall, making the pig industry a little confused
.
It is also under such circumstances that the fifth round of the "pig cycle" has a distinctive feature, that is, more obvious speculative psychology
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Zhu Zengyong said that the development of speculative psychology originated after August 2019 and until the beginning of the second quarter of 2021, pig prices remained at a relatively high level
.
"Spurred by the high profitability of the market for such a long time, many farmers are speculative
.
"XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　He said that for the pig industry, the effectiveness of government statistics is gradually improving.
At the same time, changes in the industrial structure require adjustments to monitoring samples, and adjustments require a certain amount of time
.
Since 2018, the proportion of sample data of large-scale farms has gradually increased.
Industry monitoring data has integrated retail, small-scale and large-scale farms.
Especially after 2020, the statistical scope of large-scale farms has been expanded, and the representativeness of production capacity has increased significantly.
Reflect industry trends
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　For farmers and aquaculture enterprises, after experiencing market changes in the first half of 2021, they realize the validity and objectivity of official statistics
.
However, there are also problems in the understanding of the pig price cycle by the breeding entities
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　"They all have their own logic.
After this super'pig cycle', their mentality has become uneasy, and they all want to seize the cycle of rising pig prices
.
However, the companies that really do it are precisely able to recognize the future industrial situation.
, A company that has the courage to do things
.
Taking this round of pig price increases as an example, the best time to replenish slaughter and expand production should be in the first half of 2019.
At that time, pig prices were fluctuating between the cost line and the southern region was suffering from Africa.
The impact of the swine fever epidemic
.
" Zhu Zengyong said
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　What impactXiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　In this round of "pig cycle", the regionalization and large-scale characteristics of the pig industry are also more significant
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Zhu Zengyong said that the advantages of resource endowments such as feed and land, environmental pressures, and the regional prevention and control of African swine fever and other policy factors have led to more obvious characteristics of the clustering of pig production areas
.
Among them, the status of pig breeding in the southwest and northeast regions has gradually emerged
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　From the perspective of epidemic prevention and control and production capacity control measures, in this round of "pig cycle", the government has also taken different measures from the past
.
For example, to carry out the regional prevention and control of major animal diseases such as African swine fever, from the pilot project in the central and southern region in 2019 to May 1, 2021, nationwide
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　More importantly, in September this year, the Ministry of Agriculture and Rural Affairs formulated the "Implementation Plan for Regulation and Control of Pig Production Capacity (Interim)".
37 million head" control target
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Zhu Zengyong said that the setting of control targets has filled the policy gap of counter-cyclical control from the production side.
The previous control policies were introduced when the price of pigs rose.
The main purpose of the introduction was to stimulate the enthusiasm of farmers, but the pig raising cycle It is relatively long, and it is often difficult to control the intensity.
When stimulating production, it is likely to bury hidden dangers for the next round of overcapacity
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

China's pork imports since 2000XiL China Feed Industry Information Network-Based on feed, serving animal husbandry

　　At the same time, there will be a breakthrough in pork imports in each round of the "pig cycle"
.
In this "pig cycle", pork imports will reach 4.
39 million tons in 2020
.
Before 2019, pork imports accounted for less than 4% of domestic pork production, and by 2020 this proportion will reach 10.
7%
.
With the improvement of domestic and international pork market linkage, pork import trade may extend the pig cycle time in the future
.
XiL China Feed Industry Information Network-Based on feed, serving animal husbandry