China's pork price fall continues in April

Pork prices in China dropped further in April due to oversupply and falling demand, analysts said Friday (May 8), the official Xinhua News Agency reported.

Statistics released by the National Development and Reform Commission on Thursday showed pork prices in major Chinese cities averaged RMB10.13 yuan per kilogram at the end of April, down 10.4 percent from a year earlier, the report said.

The decline led the ratio of pork prices to grain prices to stand at 6.18 to 1, the lowest level since May 2007, and nearer the threshold set by the NDRC for hog breeders to earn a profit of 6 to 1, Xinhua said.

The government will enforce subsidies for the pork production industry if the figure falls below 5 to 1, it said.

Farmers had been raising more hogs since pork prices began to climb in the first half of 2007, which may be the main reason for market oversupply and the price drop this year, Wang Xiao's, economic researcher at the Beijing Economic Information Centre, told Xinhua.

Pork prices were also affected by falling demand in summer, when people tend to eat fewer pork products, the NDRC said in a statement Thursday.

The AH1N1 flu was also a factor, Wang was cited as saying.