January 5, 2021

China's hog prices still high despite official claim that swine inventory is stabilising

Hog prices in China remain high, being close to record-highs posted in 2019, according to analysis by Dimsums' economic analysis.

This is despite the country's Ministry of Agriculture claiming that its swine inventory is approaching normal levels.

China's pig herd has been decimated by multiple outbreaks of African swine fever (ASF). The country has made huge efforts to rebuild its domestic pork supplies by supporting innovative breeding programmes and farm expansion. In December 2020, China announced that its pig herd had grown faster than expected and was now at 90% of its pre-ASF levels.

However, the increased supply has not affected pig or pork prices in China. Dimsums' analysis shows that prices for pigs and butchered carcasses for December 2020 are similar to prices posted in December 2019.

The average hog price reported by China's National Bureau of Statistics for mid-December 2020 was ¥33.9 (US$5.25) per kilogramme, just slightly below the average of ¥34.2 (US$5.29) per kilogramme the bureau reported for the same period in 2019.

For pork prices, the average wholesale price of a swine carcass averaged ¥49.82 (US$7.71) per kilogramme in mid-December 2020, slightly lower than the ¥50.99 (US$7.89) per kilogramme reported a year earlier. The price is still more than double the "normal" price, despite the Ministry's claim that the herd is just 10% below its "normal" size.

Dimsums said that the higher price could reflect increased production costs, which could keep Chinese pig prices high.

- The Pig Site