October 21, 2008

Number of pigs raised and slaughtered in China increased in the first nine months of 2008, reflecting subsidies instituted last year when high pork prices helped drive inflation, according to the National Bureau of Statistics.

A shortage of pork last year drove prices to record high and spurred inflation, but an increase in output could pressurise prices as more pigs enter the market.

Total pig stocks rose 6.6 percent on-year during the Jan-Sep period, while the number of slaughtered hogs rose 5.8 percent, said the Bureau, adding that pig production has recovered quickly from last year's disease outbreak.

Pork prices in August were flat compared with the same month last year after a sharp increase in the first half of 2008.

The National Development and Reform Commission said China would continue to offer subsidies for breeding sows and insurance for pig farmers, as well as provide incentives to counties that significantly increased pork production.

China has also subsidised beef production, but as calves take longer to raise, the impact has not yet been reflected in beef prices, according to a report.