The price of live pigs has fallen

A reporter from the China Securities Journal recently learned from pig breeding companies that due to the drop in pig prices and limited fattening space in farms, there is currently a phenomenon of piglet sales in the market

Analysts believe that, in the short term, the supply of piglets in the piglet market exceeds demand, and relevant companies should actively seek hedging measures to alleviate the downward pressure on the economy

The piglet market is now low

Wang Yanan, a senior analyst in the pig industry of Zhuochuang Information, has also recently paid attention to the phenomenon of piglet sales

According to statistics from Zhuo Chuang Information, the average profit of piglet fattening in August was -1166.

Li Wei currently works in a pig breeding company

It is understood that the current market understanding of the reasons for the price drop of piglets is relatively consistent

“Because the sales progress of the pig farm in the early stage did not keep up with the production progress of the piglets, there was a backlog of piglets

Inefficient companies speed out

It is understood that since the beginning of this year, as the price of live pigs continues to fall, the sale of piglets, self-breeding and self-raising, outsourcing and breeding, and secondary fattening have all suffered losses to varying degrees

“Sales of piglets made a partial loss in June, and fully lost money in July and August; purchased piglets also began to lose money in April, and went into full loss in May

Judging from the recent data on the stock of reproductive sows and pigs, there has not been a significant reduction change, indicating that there is no centralized elimination in the market

"In the final analysis, the supply of live pig production capacity has come up, leading to lower prices, the industry has entered a loss-making cycle, and capacity reduction has begun

In addition, from the perspective of cost, the current feed price has limited room for change, and overall the cost of pig breeding is in the high range

"Enterprises with low production efficiency will face cash flow risks

Agricultural production is faced with fluctuations in the profit cycle, and industry reshuffle usually occurs when the industry is losing money

Relief requires self-help and a combination of foreign aid

Judging from the trend of pig prices this year, according to the monitoring of Zhuo Chuang Information, the average price of slaughter pigs outside Sanyuan from January to August was 22.

How can companies help themselves in the current dilemma?

From a business perspective, Li Wei suggested that companies can optimize the structure of the herd, eliminate low-performance sows, appropriately reduce production capacity, strengthen management, and reduce production costs

“Weak hog prices are a problem that the industry needs to continue to face.
The emergence of hog futures has already brought benefits to some companies that have participated earlier
.
Whether hog companies choose to hedge their futures may lead to business performance differentiation
.
” Wei Xin Say
.

The Ministry of Agriculture and Rural Affairs recently stated that it will work with relevant departments to stabilize the basic guarantee policy for pig production and continue to increase assistance to small and medium-sized farmers
.

Wang Yanan believes that for medium-sized farmers, there are still financial pressures
.
Taking such farmers as the key training objects for assistance can relieve the great pressure of the industry to some extent
.
After all, the current proportion of small and medium-sized farmers is as high as 65%-75%
.

The latest data released by the National Bureau of Statistics shows that in August, the national consumer price index (CPI) rose by 0.
8% year-on-year
.
Analysts believe that the fall in pork prices in August was the main reason for the continued decline in CPI growth
.
With the arrival of the Mid-Autumn Festival and the National Day "Double Festival" and the advancement of the government's pork purchasing and storage work, pork prices are expected to rise, and the impact on CPI will also be weakened
.