April 3, 2010

 

Most China pig farms in red, disease hits piglet replenishment

 

 

A majority of Chinese pig farmers have been racking up losses since March and outbreaks of pig disease have led many to reduce the restocking of piglets, the ministry of agriculture said.

 

Pork prices have been falling for 11 weeks, a decline of 9.8% from the year-ago period, which have amounted to losses of RMB200 (US$29.30) per head in some major breeding areas, said the ministry's spokesman in a report late on Thursday (April 1).

 

Weak pig breeding could hurt demand for feed ingredient, soymeal, the product of soy – in which China is the world's largest soy importer.

 

According to the spokesman, sluggish pork sales, coupled with high costs of corn and labour will continue to keep pork prices low in May while breeders will stay in the red for a while.

 

China's top planner, the National Development and Reform Commission (NDRC) and commerce ministry have agreed to aid falling pork prices by stockpiling for state reserves, but so far nothing has happened.

 

"Pig diseases remain a key factor affecting breeders' confidence in restocking," said the ministry, while feed officials said more Chinese provinces reported outbreaks of disease, larger than has been reported by the ministry this month.

 

Some analysts argued that Beijing's stockpiling of pork coupled with its subsidies for breeding sows have misguided breeders, who have bred a larger-than-needed number of pigs.