February 6, 2020
Demand pushes egg futures on China's Dalian Commodity Exchange
Egg futures increase more than 4% as investors expect protein demand and consumption to bounce back amid the coronavirus outbreak in the country, reported Reuters.
After returning from the prolonged Lunar New Year break, China's commodity markets fell with several futures reaching downside limits. This was probably due to investors concerned about the coronavirus outbreak affecting protein consumption.
Among egg futures, the most actively traded egg contract hit a 4.5% increase at 3,259 RMB (~U$465.39; 1 RMB = US$0.14) per tonne, but this was 6% lower than prices before the holidays.
Yuan Song, research director at consultancy China-America Commodity Data Analytics said the market is correcting itself as egg demand and supply is not as high as projected. He said egg trading is recovering in most of parts of China is recovering, except in Hubei where trading is slow.
The city of Wuhan in Hubei province is the heart of the coronavirus outbreak that has since spread throughout the globe.
While protein demand is projected to recover, there may not be enough supplies as farmers have difficulties maintaining stocks currently.
Yuan said breeders are suffering from poor egg prices. There's an increased number of laying hen slaughters as well, which are difficult to restock.
The China government has informed local authorities to keep livestock and feed transport disruptions to a minimum during the current coronavirus outbreak.
Global trade has been affected by the coronavirus as shipments have been delayed or cancelled due to imposed restrictions.