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December 14, 2011
 
China Livestock Market Weekly Review: Southern hog prices rebound; broiler prices little changed
 
An eFeedLink Exclusive
 
 
Market analysis
 
During the week in review, hog price rebounded in central and southern regions as the meat curing season kick-started, while AA broiler prices were largely stable, buoyed by a pickup in chicken product sales and tight broiler availability.
 
Corn prices showed signs of rebounding as more corn farmers held back releases amid market hearsay that the government would be stocking corn reserves soon. Meanwhile, traders and end users stepped up procurements amid concerns that prices could firm up considerably amid government intervention.
 
Soymeal prices consolidated after the recent week's rise. Reluctant to accumulate high stocks, most buyers withheld purchases after securing sufficient supplies. China's soy import is estimated at 5.20 million tonnes this year, almost 300,000 tonnes below last year's level, due to decimated feed demand.
 
 
Market forecasts
 
Feed prices
 
Increased animal feed consumption due to rising festive demand in the coming weeks, and the likely state corn purchases will help to underpin China corn prices.
 
With port soy inventories high and another 500,000 tonnes of imports expected to reach China's shores in December, excess supplies of soy and consequently soymeal will weigh on soymeal market.
 
Livestock prices 
 
Weekly wholesale pork consumption edged up 1.66% to 9,686 tonnes, as the meat curing season kick-started in the central and southern regions with Lunar New Year holiday less than two months away. Hog prices thus rebounded in central and southern regions, reversing previous declines while northern prices stabilised.
 
AA broiler prices were stable to slightly higher, buoyed by a pickup in chicken product sales and tight broiler availability. Over the week, day-old chick prices plummeted following the end of the pre-Lunar New Year restocking drive.
 
Falling winter temperatures are likely to stimulate more consumption of pork in the coming week, strengthening hog demand amid a tight market. Similarly, broiler market should continue to gain strength in the short term.
 
 
Market monitor
  1. Da Bei Nong Group plans to build a RMB61.2-million modern breeder hog farm in Yanqing county of Beijing. The 21,900-sq-m farm will house 1,800 sows and boast an annual release volume of 36,000 breeder hogs upon reaching full capacity.

  2. Yurun Group has signed an agreement to set up a RMB10-billion agricultural by-product global purchasing centre in Xuzhou, Jiangsu province. The logistics platform will be among the largest in East China, which operations include agricultural by-product exhibition, trading, cold chain logistics, warehousing, processing and distribution, e-commerce, to inspection and quarantine, commercial R&D and food catering. The centre is expected to generate RMB20 billion in annual turnover and RMB800 million in profits within three to five years of completion.

  3. Recently, Shenyang city of Liaoning exported close to 1,000 tonnes of poultry meat into Hong Kong for the first time.

  4. A RMB50-million modern poultry demonstration farm featuring broiler and specialty poultry rearing grounds, a feed mill and tourist farm areas, recently began construction in Jinan, Shandong province. Once fully operational, annual output values and profits are estimated at RMB300 million and RMB20 million respectively. 


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