November 16, 2011
China Feed Market Bi-Weekly Review: Feed market loses steam as livestock prices weaken
An eFeedLink Exclusive
Excluding aqua sector, China's feed output and consumption fell slightly in early November as buyers delayed purchases in hopes of capturing lower prices in the wake of declining feed raw-material costs and weakening livestock product market.
Hog replenishment and inventories increased only marginally in the first half of November, as sliding hog prices and reduced margins stimulated higher animal releases. Rising imports of live hogs and pork products piled further pressure on hog prices, especially in coastal regions such as Guangdong province.
Layers' production went into off-season with winter temperatures falling rapidly across regions. As such, November saw a sharp decline in egg output, while egg prices also declined, causing some layer farmers to incur losses.
By comparison, most broiler farmers remained in the red, as broiler prices continued to drop for weeks before rebounding slightly by mid-November as supplies tightened. A pickup in restocking demand for the New Year holiday propped up day-old chick prices. Higher replenishment, coupled with fewer releases, shored up broiler inventories over the month.
China's aqua production, including those in the southern regions, dwindled further in early November. Price for major aqua products dipped slightly amid rising supplies.
November's milk yield plunged sharply as harsh winter in the north affected the productivity of dairy cattle. In the consumer market, raw and finished milk prices stayed relatively stable, while beef and mutton prices climbed higher amid strong seasonal demand and limited availability, but the upside had slowed.
In the coming period, livestock prices should stabilise through the end of November, before taking an upturn in December with the arrival of winter meat-curing season.
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