May 17, 2012

China's pork prices are forecasted for a 20% increase as the supply of live pigs will see a substantial drop around June and July as a result of farmers hastily selling live pigs, according to reports.

According to Tan Moxiao, an economic analyst from Xinhua, in order to avoid losses, some farmers have started to sell live pigs and even pregnant sows. It is believed that the trend may cause price volatility in the future market.

Raising live pigs is generally considered non-profitable. Monitoring by soozhu.com, a pig-feeding industry information portal, showed that the national average price of live pigs was CNY13.53 (US$2.14) per kilogrammes on Tuesday. It slid even lower than the bottom standard of mid-April.

The selling price of live pigs and pork in May have not increased as much as predicted. In fact, multiple monitoring agencies have found that the prices are continuing to fall, said the report.

Data released by the Commerce Department on Tuesday showed that pork prices have continued to fall after the Spring Festival due to off-season consumption, market supply increases and other factors.

As of last week (May 7 to May 13), the wholesale price of pork dropped 0.2% compared to the previous week, and compared to late January, the cumulative decline reached 15%, the report said.

Feng Yonghui, the principal analyst of the website, told Economic Information Daily that because the price has seen no improvements in the past 10 days, some farmers have started selling pigs that weight 125 kilogrammes or more.