Alert issued as hog prices remain low

The National Development and Reform Commission issued a second-level warning for an excessive decline in the price of live hogs. The commission has a three-level warning system for excessive rises or declines in hog prices.

From January 16 to 20 the ratio of hog prices to corn prices averaged 5.48:1. When the price ratio averages between 5:1 to 6:1 for three consecutive weeks, the second-highest price warning is triggered.

Cash prices were steady over the holiday with national average prices ranging from 15 to 16 yuan per KG. As of Monday, the hog-to-corn ratio was at 5.10:1. If the ratio falls below 5:1, this would trigger the NDRC’s highest-level warning. This would lead to the government starting more aggressive market support programs, including buying of pork and hogs from farmers to boost prices.

In terms of poultry, duck breeding stock has seen prices soar during January. The price of a duckling has risen from 1.7 yuan per bird at the start of the year to 6.1 yuan today.

Duck producers had faced losses during most of China’s zero-covid period as restaurant demand was depressed. This led to many farmers leaving the industry, including several large operators.

This reduction in supply is now leading to a sharp rise in duck breeding stock as demand has recovered with the end of the zero covid policy.