The profitability for hog breeders in China is expected to worsen for the rest of this month due to weak demand and an increasing supply that pressured hog prices lower.
The average loss for the hog breeding industry in China is estimated at around 275 yuan per head, according to the latest data from the country’s economic planning body, the National Development and Reform Commission (NDRC).
Weaker hog breeding margins were largely triggered by a falling hog price in China that hit the lowest level since late April 2022. Hog prices in the country averaged 14.68 yuan per kg, down more than 16% since the beginning of the 2022 calendar year.
“As the Spring Festival holiday came to an end, consumption from end users softened gradually. But breeders are still under pressure to destock,” said NDRC.
The commission expects hog prices to further slide due to the combination of poor post-holiday demand and a bigger supply.