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During October, the overall pig spot price showed a rising and falling trend, the main reason for the rapid rise in pig prices before mid-October was the contradiction between supply and demand, on the one hand, the supply of large-weight pigs was relatively tight, on the other hand, because the market was generally optimistic about the future market, secondary fattening began to increase, and sporadic pickling stocking in some areas also drove demand, which made the overall trend of pig prices strong
。 However, in terms of futures trends, the disk trend is significantly weaker than the spot, which is mainly due to the relatively poor market expectations of the market, and from the performance of the November contract discount into the delivery month, the logic of market trading still lies in the rapid decline
in pig prices during November.
It can be seen that in the last week of the end of October, the price of live pigs showed a rapid decline under policy control, and the intensity of policy regulation and control increased significantly, in addition to the initial media guidance, to storage, to increase the scale of enterprises out of the slaughter, and finally to stop selling adult pigs to secondary fattening households, the intensity is increasing
.
The new supply of adult pigs during November mainly corresponds to the number of newly born piglets in May and the inventory and breeding of capable sows in January this year, according to the previous inventory structure, the supply of new adult pigs during November to December is still relatively limited, although the current pig slaughter weight has increased, but from the historical performance, the rigid consumption of pork in the fourth quarter generally increased by about 20% compared with the third quarter, which also means that there may still be a certain gap in supply and demand, which needs to be suppressed by high prices
。 In contrast, the strength and method of policy regulation and control may still be a blind box, although short-term listing can not change the trend of price operation, but for the grasp of the rhythm, there may be more uncertainty
.
Review of current market conditions
During October, the national pig price as a whole showed a peak and decline, and since the National Day, the national pig price has risen
rapidly as a whole driven by secondary fattening, shortage of large pigs and demand recovery 。 As of the end of the month, the price of live pigs across the country generally increased by about 2-3 yuan, including 25.
9-26.
3 yuan/kg in Northeast China, up 2.
1-2.
25 yuan/kg, 26.
75-27.
3 yuan/kg in North China, up 2.
35-2.
6 yuan/kg, 26.
45-26.
55 yuan/kg, up 2.
1 yuan/kg, and 26.
65-27.
45 yuan/kg, up 1.
9-2.
5 yuan/kg, in East China.
South China was 26.
4-27.
55 yuan/kg, up 1.
8-2.
25 yuan/kg, and the increase was relatively uniform
across the country.
However, after entering the second half of October, the market's control of pig prices began to gradually increase, the slaughter volume of some large-scale enterprises began to increase, the overall price showed a high downward trend, and high volatility became the main feature of
the pig market in the month.
Compared with the high volatility of the spot market, futures performance is obviously more positive, especially for far-month contracts, after the spot is high, the enthusiasm of hedging orders and speculative funds to the far-month position has increased significantly, and the futures as a whole have shown a trend of discounting to the spot operation, and the spot pair 01 basis has begun to rise continuously since the completion of the transformation structure in late September, once climbing to a high of
about 4,000 yuan / ton 。 On the whole, the futures discount on the spot operation on the one hand is pessimistic about the pig market, on the other hand, it also reflects that the overall domestic spot is still tight from the perspective of disk structure; Even considering the premium given by the delivery depot in the southwest region, the November contract is not tempting for the delivery of hog bears, and indeed does not rule out the possibility of being suppressed too deeply, but considering that hogs are selected for delivery every day throughout the month, the November contract discount itself also reflects the expectation
of a decline in pig prices during the month.
On the whole, both ends of the supply and demand of the pig market recovered during October, but the shortage of large pigs and the gradual recovery of demand are still the main logic of dominating the market, and the gradual correction of pig prices in the early October is mainly caused by policy regulation, but in the case of the contradiction between supply and demand, the price below still has a strong support momentum
.
Compared with the adjustment of supply and demand, the main pressure on the market in October still lies in policy, and it can be seen that from promoting slaughter to stopping the sale of adult pigs for partial secondary fattening are all ways to limit the price increase space, which also has a more significant effect
on the decline in mid-to-late October.
Hog fundamentals
First, the profit and cost of aquaculture
During October, the profit of pig breeding continued to hit a new high with the rise in pig prices, and because the gross profit from the sale of piglets began to gradually turn positive, the profit of self-breeding and self-raising began to gradually exceed the profit of purchased piglets, as of the last week of October, the profit of pig self-breeding and self-raising was 1175 yuan / head, up 375 yuan from a month ago, and the profit of purchased piglets was 1169 yuan / head, up 366 yuan
from a month ago 。 It can be seen that since April last year, piglet prices have gradually started an upward trend, which has gradually improved the gross profit of piglets, and then formed a pattern
in which the current profit of self-breeding and self-raising is better than the profit of purchased piglets.
In addition, we believe that the follow-up pig breeding profit has basically entered a high range, on the one hand, the recent rise in pig prices has faced greater regulatory pressure on the policy side, on the other hand, the cost increase in the follow-up response has begun to become more and more obvious, in this context, we expect that the profit of pig breeding during November will be more
dominated by a pattern of high volatility.
The data shows that the sow price rose from 35.
6 yuan/kg to 36.
32 yuan/kg in September, an increase of 2.
02%.
However, on the whole, the rebound of sow prices is mainly driven by the increase in the price of commodity pigs, the market itself inquiry atmosphere is still relatively light, and the willingness of enterprises to make up the slaughter is average
.
On the whole, the current sow self-breeding and self-raising cost is basically about 17 yuan / kg, which also means that the pig price needs to be above this price before August next year, from the pig 2307 contract trend, the contract price during October has been down, the current has reached 18 yuan / kg or less, considering its own selling delivery costs and other friction factors, which means that the market is generally not optimistic about the future market, so in this context, the sow willingness to replenish the slaughter will be hindered
。 From the perspective of the price comparison between eliminated sows and commercial pigs, the overall price of culled sows remains high to a certain extent, reflecting that the market sentiment is still relatively serious, in the context of weak slaughter replenishment and more delayed culling to meet demand, it is expected that sow prices still lack too strong upward momentum, or more driven by commercial pigs
.
During October, the piglet price rose more obviously, from the previous 41.
8 yuan / kg rose to 47.
2 yuan / kg, the month-on-month increase reached 12.
92%, the current piglet fattening cost is generally around 19 yuan / kg, although considering the subsequent winter epidemic may increase the impact, but because the previous market replenishment itself is not strong, so the market is not bearish on the pig price after next year, especially in the fourth quarter of this year, the breeding enterprises in the case of taking the initiative to come out of the slaughter, The supply performance after the year showed a tightening situation, so although it is not low in terms of the cost of slaughtering, the actual transaction is relatively better than that of sows
.
And affected by the recent secondary fattening, the rapid rise in the price of commercial pigs and adult pigs has also pulled the price of piglets
.
2.
Pig inventory
According to data from the Ministry of Agriculture and Rural Affairs, the number of capable sows rose by 0.
88% month-on-month to 43.
66 million in September, due to the low number of cullings and the increase in replacement of gilts during June this year.
During July this year, the replacement of gilts began to decline slightly from the previous month, so on the supply side, the number of new sows may have decreased, but during October, the market was more dominated by normal culling, and as pig prices continued to remain high, it is expected that there will be no too obvious over-panning pressure, and the inventory of capable sows is expected to remain flat
compared with the overall month.
In terms of total inventory, the commercial pig inventory increased slightly from the previous month during September, and it can be seen that the inflection point appeared before July, earlier than the market predicted, and the pig feed data released by the feed industry association can basically verify
this.
The stock began to gradually climb on the one hand due to the good recovery of the production capacity itself, and on the other hand, due to the relatively low number of pigs slaughtered during this period
.
The new supply of piglets in October mainly corresponds to the sow inventory and breeding situation in June this year, during this period, the sow inventory has begun to show a gradual increase from the previous month, so the new supply itself is increasing, on the other hand, the number of mature pigs itself is relatively small during this period, the number of slaughtered is low, and farmers are accompanied by a reluctance
to sell.
As a result
, the overall inventory is gradually increasing during this period.
High-frequency data slaughter data showed that the number of live pigs slaughtered during October increased by 0.
57% month-on-month, and the market supply gap eased slightly
.
From the final release of slaughter in the past few months, there is a big difference between slaughter and slaughter data, an important impact may be the impact of secondary fattening and pen storage, on the other hand, the second fattening during mid-to-early October and the strong sentiment of farmers to sell also led to a slight tightening
of the supply of pigs compared with before.
During October, the weight of pigs out of the slaughter continued to increase steadily, from 128 kg to 129.
3 kg, and the increase rate of pig weight was in line with seasonal changes
.
At the end of September, the price difference between 200 kg pigs and standard pigs was 0.
36 yuan, and by the week of October 27, the price difference between 200 kg and standard pigs had risen to 0.
62 yuan/kg, a cumulative increase of 0.
26 yuan
in the month.
To a certain extent, it reflects that the supply of large-weight pigs in the market is still relatively tight, and on the whole, after entering November, the market is gradually increasing whether it is pickled or the weather is cooler
.
Overall, pork consumption during October was relatively lower than expected, which contradicted
previous market estimates.
We believe that the recent pork consumption is lower than expected or adversely affected by high prices to a certain extent, especially after the price of hairy pigs has hit a new high, the processing profits of slaughtering enterprises have fallen into losses, and the downstream acceptance of high-priced white bars has begun to decline, on the other hand, during October, domestic epidemic prevention and control has not been relaxed, and there are still cases reported in some areas, in this context, market consumption still does not see too many bright spots
。 During September, the domestic social zero data continued to perform poorly, of which catering consumption continued to decline by 1.
7% year-on-year, and after experiencing a phased improvement in August, domestic consumption was again under pressure
.
After entering November, we believe that under the influence of high prices, rigid consumption may be restricted, and the continuous sell-off of reserve meat will also curb the demand for fresh products to a large extent, but as the traditional pickled and stocked season, the momentum of consumption may still have a basic guarantee, and the adjustment of price increases still needs to be limited
by supply.
During October, the overall pig spot price showed a rising and falling trend, the main reason for the rapid rise in pig prices before mid-October was the contradiction between supply and demand, on the one hand, the supply of large-weight pigs was relatively tight, on the other hand, because the market was generally optimistic about the future market, secondary fattening began to increase, and sporadic pickling stocking in some areas also drove demand, which made the overall trend of pig prices strong
。 However, in terms of futures trends, the disk trend is significantly weaker than the spot, which is mainly due to the relatively poor market expectations of the market, and from the performance of the November contract discount into the delivery month, the logic of market trading still lies in the rapid decline
in pig prices during November.
It can be seen that in the last week of the end of October, the price of live pigs showed a rapid decline under policy control, and the intensity of policy regulation and control increased significantly, in addition to the initial media guidance, to storage, to increase the scale of enterprises out of the slaughter, and finally to stop selling adult pigs to secondary fattening households, the intensity is increasing
.
The new supply of adult pigs during November mainly corresponds to the number of newly born piglets in May and the inventory and breeding of capable sows in January this year, according to the previous inventory structure, the supply of new adult pigs during November to December is still relatively limited, although the current pig slaughter weight has increased, but from the historical performance, the rigid consumption of pork in the fourth quarter generally increased by about 20% compared with the third quarter, which also means that there may still be a certain gap in supply and demand, which needs to be suppressed by high prices
。 In contrast, the strength and method of policy regulation and control may still be a blind box, although short-term listing can not change the trend of price operation, but for the grasp of the rhythm, there may be more uncertainty
.
Overall, we believe that after the short-term correction of pig prices, market consumption is still expected to be pulled, and in the case of tight supply and demand, the support below pig prices still exists
.
Specific to the futures market, the short-term adjustment may support the far-month contract, and the recent 11-3 consecutive out of the anti-arbitrage market has also reacted
to this to a certain extent.
Stay tuned for the lower support
of the 01 contract.
;
;During October, the overall pig spot price showed a rising and falling trend, the main reason for the rapid rise in pig prices before mid-October was the contradiction between supply and demand, on the one hand, the supply of large-weight pigs was relatively tight, on the other hand, because the market was generally optimistic about the future market, secondary fattening began to increase, and sporadic pickling stocking in some areas also drove demand, which made the overall trend of pig prices strong
。 However, in terms of futures trends, the disk trend is significantly weaker than the spot, which is mainly due to the relatively poor market expectations of the market, and from the performance of the November contract discount into the delivery month, the logic of market trading still lies in the rapid decline
in pig prices during November.
It can be seen that in the last week of the end of October, the price of live pigs showed a rapid decline under policy control, and the intensity of policy regulation and control increased significantly, in addition to the initial media guidance, to storage, to increase the scale of enterprises out of the slaughter, and finally to stop selling adult pigs to secondary fattening households, the intensity is increasing
.
The new supply of adult pigs during November mainly corresponds to the number of newly born piglets in May and the inventory and breeding of capable sows in January this year, according to the previous inventory structure, the supply of new adult pigs during November to December is still relatively limited, although the current pig slaughter weight has increased, but from the historical performance, the rigid consumption of pork in the fourth quarter generally increased by about 20% compared with the third quarter, which also means that there may still be a certain gap in supply and demand, which needs to be suppressed by high prices
。 In contrast, the strength and method of policy regulation and control may still be a blind box, although short-term listing can not change the trend of price operation, but for the grasp of the rhythm, there may be more uncertainty
.
Review of current market conditions
Spot market reviewReview Spot market reviewDuring October, the national pig price as a whole showed a peak and decline, and since the National Day, the national pig price has risen
rapidly as a whole driven by secondary fattening, shortage of large pigs and demand recovery 。 As of the end of the month, the price of live pigs across the country generally increased by about 2-3 yuan, including 25.
9-26.
3 yuan/kg in Northeast China, up 2.
1-2.
25 yuan/kg, 26.
75-27.
3 yuan/kg in North China, up 2.
35-2.
6 yuan/kg, 26.
45-26.
55 yuan/kg, up 2.
1 yuan/kg, and 26.
65-27.
45 yuan/kg, up 1.
9-2.
5 yuan/kg, in East China.
South China was 26.
4-27.
55 yuan/kg, up 1.
8-2.
25 yuan/kg, and the increase was relatively uniform
across the country.
However, after entering the second half of October, the market's control of pig prices began to gradually increase, the slaughter volume of some large-scale enterprises began to increase, the overall price showed a high downward trend, and high volatility became the main feature of
the pig market in the month.
Compared with the high volatility of the spot market, futures performance is obviously more positive, especially for far-month contracts, after the spot is high, the enthusiasm of hedging orders and speculative funds to the far-month position has increased significantly, and the futures as a whole have shown a trend of discounting to the spot operation, and the spot pair 01 basis has begun to rise continuously since the completion of the transformation structure in late September, once climbing to a high of
about 4,000 yuan / ton 。 On the whole, the futures discount on the spot operation on the one hand is pessimistic about the pig market, on the other hand, it also reflects that the overall domestic spot is still tight from the perspective of disk structure; Even considering the premium given by the delivery depot in the southwest region, the November contract is not tempting for the delivery of hog bears, and indeed does not rule out the possibility of being suppressed too deeply, but considering that hogs are selected for delivery every day throughout the month, the November contract discount itself also reflects the expectation
of a decline in pig prices during the month.
On the whole, both ends of the supply and demand of the pig market recovered during October, but the shortage of large pigs and the gradual recovery of demand are still the main logic of dominating the market, and the gradual correction of pig prices in the early October is mainly caused by policy regulation, but in the case of the contradiction between supply and demand, the price below still has a strong support momentum
.
Compared with the adjustment of supply and demand, the main pressure on the market in October still lies in policy, and it can be seen that from promoting slaughter to stopping the sale of adult pigs for partial secondary fattening are all ways to limit the price increase space, which also has a more significant effect
on the decline in mid-to-late October.
Hog fundamentals
First, the profit and cost of aquaculture
First, breeding profit and cost
During October, the profit of pig breeding continued to hit a new high with the rise in pig prices, and because the gross profit from the sale of piglets began to gradually turn positive, the profit of self-breeding and self-raising began to gradually exceed the profit of purchased piglets, as of the last week of October, the profit of pig self-breeding and self-raising was 1175 yuan / head, up 375 yuan from a month ago, and the profit of purchased piglets was 1169 yuan / head, up 366 yuan
from a month ago 。 It can be seen that since April last year, piglet prices have gradually started an upward trend, which has gradually improved the gross profit of piglets, and then formed a pattern
in which the current profit of self-breeding and self-raising is better than the profit of purchased piglets.
In addition, we believe that the follow-up pig breeding profit has basically entered a high range, on the one hand, the recent rise in pig prices has faced greater regulatory pressure on the policy side, on the other hand, the cost increase in the follow-up response has begun to become more and more obvious, in this context, we expect that the profit of pig breeding during November will be more
dominated by a pattern of high volatility.
The data shows that the sow price rose from 35.
6 yuan/kg to 36.
32 yuan/kg in September, an increase of 2.
02%.
However, on the whole, the rebound of sow prices is mainly driven by the increase in the price of commodity pigs, the market itself inquiry atmosphere is still relatively light, and the willingness of enterprises to make up the slaughter is average
.
On the whole, the current sow self-breeding and self-raising cost is basically about 17 yuan / kg, which also means that the pig price needs to be above this price before August next year, from the pig 2307 contract trend, the contract price during October has been down, the current has reached 18 yuan / kg or less, considering its own selling delivery costs and other friction factors, which means that the market is generally not optimistic about the future market, so in this context, the sow willingness to replenish the slaughter will be hindered
。 From the perspective of the price comparison between eliminated sows and commercial pigs, the overall price of culled sows remains high to a certain extent, reflecting that the market sentiment is still relatively serious, in the context of weak slaughter replenishment and more delayed culling to meet demand, it is expected that sow prices still lack too strong upward momentum, or more driven by commercial pigs
.
.
During October, the piglet price rose more obviously, from the previous 41.
8 yuan / kg rose to 47.
2 yuan / kg, the month-on-month increase reached 12.
92%, the current piglet fattening cost is generally around 19 yuan / kg, although considering the subsequent winter epidemic may increase the impact, but because the previous market replenishment itself is not strong, so the market is not bearish on the pig price after next year, especially in the fourth quarter of this year, the breeding enterprises in the case of taking the initiative to come out of the slaughter, The supply performance after the year showed a tightening situation, so although it is not low in terms of the cost of slaughtering, the actual transaction is relatively better than that of sows
.
And affected by the recent secondary fattening, the rapid rise in the price of commercial pigs and adult pigs has also pulled the price of piglets
.
<>.
Pig inventory
Pig inventory
According to data from the Ministry of Agriculture and Rural Affairs, the number of capable sows rose by 0.
88% month-on-month to 43.
66 million in September, due to the low number of cullings and the increase in replacement of gilts during June this year.
During July this year, the replacement of gilts began to decline slightly from the previous month, so on the supply side, the number of new sows may have decreased, but during October, the market was more dominated by normal culling, and as pig prices continued to remain high, it is expected that there will be no too obvious over-panning pressure, and the inventory of capable sows is expected to remain flat
compared with the overall month.
88% month-on-month to 43.
66 million in September, due to the low number of cullings and the increase in the number of gilts during June this year, the inventory of capable sows is expected to remain flat
month-on-month.
In terms of total inventory, the commercial pig inventory increased slightly from the previous month during September, and it can be seen that the inflection point appeared before July, earlier than the market predicted, and the pig feed data released by the feed industry association can basically verify
this.
The stock began to gradually climb on the one hand due to the good recovery of the production capacity itself, and on the other hand, due to the relatively low number of pigs slaughtered during this period
.
The new supply of piglets in October mainly corresponds to the sow inventory and breeding situation in June this year, during this period, the sow inventory has begun to show a gradual increase from the previous month, so the new supply itself is increasing, on the other hand, the number of mature pigs itself is relatively small during this period, the number of slaughtered is low, and farmers are accompanied by a reluctance
to sell.
As a result
, the overall inventory is gradually increasing during this period.
High-frequency data slaughter data showed that the number of live pigs slaughtered during October increased by 0.
57% month-on-month, and the market supply gap eased slightly
.
From the final release of slaughter in the past few months, there is a big difference between slaughter and slaughter data, an important impact may be the impact of secondary fattening and pen storage, on the other hand, the second fattening during mid-to-early October and the strong sentiment of farmers to sell also led to a slight tightening
of the supply of pigs compared with before.
57% month-on-month, and the market supply gap eased slightly
During October, the weight of pigs out of the slaughter continued to increase steadily, from 128 kg to 129.
3 kg, and the increase rate of pig weight was in line with seasonal changes
.
At the end of September, the price difference between 200 kg pigs and standard pigs was 0.
36 yuan, and by the week of October 27, the price difference between 200 kg and standard pigs had risen to 0.
62 yuan/kg, a cumulative increase of 0.
26 yuan
in the month.
To a certain extent, it reflects that the supply of large-weight pigs in the market is still relatively tight, and on the whole, after entering November, the market is gradually increasing whether it is pickled or the weather is cooler
.
Overall, pork consumption during October was relatively lower than expected, which contradicted
previous market estimates.
We believe that the recent pork consumption is lower than expected or adversely affected by high prices to a certain extent, especially after the price of hairy pigs has hit a new high, the processing profits of slaughtering enterprises have fallen into losses, and the downstream acceptance of high-priced white bars has begun to decline, on the other hand, during October, domestic epidemic prevention and control has not been relaxed, and there are still cases reported in some areas, in this context, market consumption still does not see too many bright spots
。 During September, the domestic social zero data continued to perform poorly, of which catering consumption continued to decline by 1.
7% year-on-year, and after experiencing a phased improvement in August, domestic consumption was again under pressure
.
previous market estimates.
After entering November, we believe that under the influence of high prices, rigid consumption may be restricted, and the continuous sell-off of reserve meat will also curb the demand for fresh products to a large extent, but as the traditional pickled and stocked season, the momentum of consumption may still have a basic guarantee, and the adjustment of price increases still needs to be limited
by supply.
During October, the overall pig spot price showed a rising and falling trend, the main reason for the rapid rise in pig prices before mid-October was the contradiction between supply and demand, on the one hand, the supply of large-weight pigs was relatively tight, on the other hand, because the market was generally optimistic about the future market, secondary fattening began to increase, and sporadic pickling stocking in some areas also drove demand, which made the overall trend of pig prices strong
。 However, in terms of futures trends, the disk trend is significantly weaker than the spot, which is mainly due to the relatively poor market expectations of the market, and from the performance of the November contract discount into the delivery month, the logic of market trading still lies in the rapid decline
in pig prices during November.
It can be seen that in the last week of the end of October, the price of live pigs showed a rapid decline under policy control, and the intensity of policy regulation and control increased significantly, in addition to the initial media guidance, to storage, to increase the scale of enterprises out of the slaughter, and finally to stop selling adult pigs to secondary fattening households, the intensity is increasing
.
The new supply of adult pigs during November mainly corresponds to the number of newly born piglets in May and the inventory and breeding of capable sows in January this year, according to the previous inventory structure, the supply of new adult pigs during November to December is still relatively limited, although the current pig slaughter weight has increased, but from the historical performance, the rigid consumption of pork in the fourth quarter generally increased by about 20% compared with the third quarter, which also means that there may still be a certain gap in supply and demand, which needs to be suppressed by high prices
。 In contrast, the strength and method of policy regulation and control may still be a blind box, although short-term listing can not change the trend of price operation, but for the grasp of the rhythm, there may be more uncertainty
.
Overall, we believe that after the short-term correction of pig prices, market consumption is still expected to be pulled, and in the case of tight supply and demand, the support below pig prices still exists
.
Specific to the futures market, the short-term adjustment may support the far-month contract, and the recent 11-3 consecutive out of the anti-arbitrage market has also reacted
to this to a certain extent.
Stay tuned for the lower support
of the 01 contract.
