High-level government guidance to stabilize sow herd

The State Council, China’s cabinet which sits above the National Development and Reform Commission (NDRC), published a long policy document on Wednesday which includes updated guidance for agriculture.

Stability of pork supplies and prices remains a major point with the State Council saying the government should consolidate the responsibility of managing the amount of live hog production in the country and should strengthen regulation around government pork reserves.

It further said the provinces which have seen large reductions in sow capacity should work to increase the number of breeding sows and local governments which shut down legally operating hog farms due to land use or environmental reasons should take actions to correct those closures.

While the NDRC has made many announcements in recent weeks about lower live hog prices in the near term, the State Council seems more concerned about stabilizing the sow herd.

Policy makers in Beijing have said in recent months that they view changes in the size of the sow herd as the major contributing factor in the hog price cycles in recent decades.

The rapid rise in hog and pork prices in the past few months have caused the government to issue its highest-level alert for the rise in hog prices, pressure companies to maintain a normal pace of slaughter, and release pork from government reserves.

The State Council said it would be responsibility of several ministries to enact these changes, including the NDRC, the Ministry of Agriculture, the Ministry of Finance, Ministry of Natural Resources, and the Ministry of Ecology and Environment.