September 24, 2007

 

China pork supply unlikely to rebound til mid-08; prices high

 

 

China's pork supply may not fully rebound to normal levels until mid-2008, and production costs remain high, so prices are likely to stay relatively high till then, an industry official said Friday (September 21).

 

"It simply takes time to increase the number of piglets and to rear pigs," the vice chairman of China Animal Agriculture Association, Qiao Yufeng, said.

 

A breeding cycle usually takes one year, making it difficult to increase market supply quickly.

 

"And this (shortage) happens at a time when prices of agricultural products, which are used to produce the feed, are rising quickly," Qiao said on the sidelines of an industry conference in Shanghai Friday.

 

Prices of soy, soymeal and corn, which are used to make animal feeds, have all been growing fast, and unfavourable weather conditions have made industry participants believe that prices are unlikely to see a sharp fall any time soon.

 

"Besides the cost of feed demand, higher expenses in disease prevention, and the shortage of rural labor all underpin the prices," Qiao said.

 

Chinese hogs have been hit by infectious diseases since mid-2005, and researchers still hold divergent opinions on the causes behind the outbreaks, industry officials said at the 3rd JCI China Feed Market conference.

 

"What I can say is that stocks are recovering steadily, but how fast, I'm not sure. The blue ear disease is under control, but it's hard to eliminate it completely," he said.

 

Surging pork and poultry prices have contributed to China's high inflation rate in August. The on-year consumer price index rose to 6.5 percent in August from 5.6 percent in July, the highest rate in more than 10 years.