May 28, 2020
Poultry and egg prices in China on the downtrend
China's poultry and egg prices have decreased due to low demand coupled with higher inventories, Reuters reported.
On the Dalian Commodity Exchange, egg futures prices fell to its lowest after hitting a three year high in October last year.
The June delivery contract is down 14% this month. On May 27, it fell 2.3% to 2,641 RMB (~US$386.92; 1 RMB = US$0.14) per tonne.
Lin Qing, Junrui Futuresagriculture analyst said the African swine fever (ASF) pushed production of poultry and eggs, but the COVID-19 pandemic has affected consumption.
Lin added that egg prices will remain low as inventories remain high in 2020. Prices could increase during the Dragon Boat Festival in June) and the Mid-Autumn Festival in October, but not to record highs.
Poultry production in China expanded 12% in 2019 to 22.39 million tonnes, with farmers increasing poultry production after the ASF outbreak in the country decimated its swine herd.
China's agriculture ministry data showed that egg retail and wholesale prices dropped in May, its lowest since July-August 2017. Chicken retail and wholesale prices also fell to its lowest since July-August 2019.
Darin Friedrichs, brokerage INTL FCStonesenior Asia commodity analyst said demand for poultry and egg is steadily rising but it has not resumed to pre-COVID-19 levels as many foodservice outlets have not resumed operations.
Friedrichs said pork and hog prices have been volatile, affecting the poultry market. Prices for pork have dropped with China increased imports for the meat, lower demand and farmers selling due to concerns over declining prices.
China PORK-CN-TOT-D showed pork prices are 26% lower since February.