This week's live pig price was 15.15 yuan/kg, down 0.46% from last week; The price of pork was 20.59 yuan/kg, down 0.58% from last week; The price of piglets was 44.36 yuan/kg, down 0.56% from last week; The price of binary sows was 2594.79 yuan/head, up 0.80% from last week.
According to the monitoring data of the Ministry of Commerce, in the third week of April 2024, the Ministry of Commerce monitored the average wholesale price of white pigs in the country at 20.03 yuan/kg, down 0.20% from last week.
Hog prices
Hog prices fell for the most part
This week, the price of live pigs fell mostly month-on-month, Jilin at 7.23-7.53 yuan/jin, down 0.02 yuan/jin from last week, and Liaoning at 7.10-7.40 yuan/jin, down 0.01 yuan/jin from last week. Beijing was 7.58-7.88 yuan/jin, up 0.03 yuan/jin from last week. Zhejiang was 7.40-7.70 yuan/jin, down 0.04 yuan/jin from last week. Xinjiang was 7.31-7.61 yuan/jin, down 0.12 yuan/jin from last week. Sichuan fell to 7.00-7.30 yuan/jin, Hebei fell to 7.45-7.75 yuan/jin, Shandong fell to 7.21-7.51 yuan/jin, Henan fell to 6.59-6.89 yuan/jin, and Guangdong rose to 8.13-8.43 yuan/jin.
Pork prices
The Ministry of Commerce monitored the wholesale price of white pigs in the third week of April 2024, which increased in a narrow range month-on-month. In the off-season of demand, the consumption performance is weak, the white strips are generally good, the superimposed pig prices continue to fall, and the rise of pork is weak.
Piglet prices
According to the monitoring data of the Ministry of Agriculture and Rural Affairs, the price of piglets rose by 1.80% month-on-month last week, down 1.70% from the same period last year, and the average price of piglets in 500 rural markets across the country was 37.15 yuan/kg. According to the statistics of this website, the price of piglets in three yuan this week was 44.36 yuan / kg, affected by a large number of small and medium-sized scattered pigs at the breeding end of the current pig price rise less than expected, and the rising dissatisfaction, the demand for standard pigs "two breeding" has weakened, and the demand for commercial piglets has also cooled down, and the price of piglets continued to fluctuate weakly during the week, and the weekly average price fell in a narrow range from the previous month.
Pig grain price comparison
This week's pig-to-food ratio was 6.5, up 0.01 from last week. The price of corn was 2.33 yuan/catty, which was weaker than last week, and the loss of self-breeding and self-raising this week was 209 yuan/head. Domestic grassroots growers are busy with spring ploughing and spring planting, the amount of corn is reduced, the enthusiasm of feed enterprises to stock up before the holiday is not high, the shutdown and maintenance of deep processing enterprises has increased, the effective supply is relatively sufficient, and the confidence of traders to raise prices is insufficient. In late April and May, China's corn inventory will continue to decline overall, but the natural dry corn in the northeast producing areas has entered the stage of centralized listing, and the supply of imported corn and alternative raw materials is still sufficient, while the total monthly consumption demand for corn on the demand side of breeding and feed production continues to grow, but it is still limited, and the support for prices has recovered but is still weak. It is predicted that during the second half of April and the first half of May, the average daily trading price of corn spot in the producing areas will continue to remain stable, with a slight rise and fall in general, and the overall trend is slightly weak.
Market summary
This week, pig prices continued to decline weakly month-on-month. In the off-season of demand, consumption is still weak, the wholesale market is generally white, the demand for price support is weak, and the slaughtering enterprises are more willing to reduce the price of pigs. However, as the May Day holiday is approaching, the downstream market may have a demand for centralized stocking, which supports the sentiment of high prices at the breeding end, and some retail investors are reluctant to sell. The market supply and demand game is obvious, the overall pig price is weak and stable during the week, and the weekly average price continues to fall month-on-month.
In general, in the late April and the first half of May, the frequency of adjustment of the average daily trading price of large pigs in the country will be more frequent, and the big ups and downs lack an obvious basis, and the ups and downs are in a dilemma. In the latter part of late May, the probability of price recovery around mid-June will gradually increase, ushering in an increase in the probability of seasonal trend increases. From the perspective of the whole year, we still believe that although the probability of a trend rebound in pig prices will gradually increase around mid-June, the probability of the "highlight moment" of pig prices in 2024 will be higher after July.
In terms of breeding efficiency, affected by the continued decline in feed costs, some self-breeding farms and small and medium-sized scattered farms in the northern region continue to be profitable, and the losses of a small number of group farms continue to narrow. However, if the pig price falls in May as scheduled, it will lead to some farms returning to losses. The southern region will continue to face losses at present and in the near future, while the average efficiency of the whole industry in the country will continue to be in the red. We still believe that after the second half of June - July, the national breeding efficiency will usher in a substantial "good".
Piglet prices around the country (unit: yuan/kg)
Yicheng City, Hubei Province 15 kg outside three yuan 45.00
Hunan Province Tianxin District 15 kg outer three yuan 42.00
Shulan City, Jilin Province 15 kg three yuan 36.00
Hanting District, Shandong Province, 15 kg wai three yuan 49.00
Xingtang County, Hebei Province 15 kg outside three yuan 38.00
Bincheng District, Shandong Province 15 kg outside three yuan 45.00
Hubei Province Suixian 15 kg outside three yuan 50.00
Qiaodong District, Hebei Province 15 kg Wai Sanyuan 55.00
| Tomorrow's pig price (for reference only) | ||||
| 2024-4-27 | ||||
| East | Shanghai | 7.7~8.0 | 110kg | flat |
| Shandong | 7.4~7.7 | 110kg | fall | |
| Anhui | 7.5~7.7 | 110kg | fall | |
| chekiang | 7.7~8.0 | 110kg | flat | |
| Jiangsu | 7.6~7.7 | 110kg | fall | |
| Fujian | 7.7~7.9 | 110kg | fall | |
| Central | Jiangxi | 7.4~7.6 | 110kg | fall |
| Hubei | 7.3~7.6 | 110kg | fall | |
| Henan | 7.4~7.7 | 110kg | flat | |
| Hunan | 7.4~7.7 | 110kg | flat | |
| South | Guangdong | 7.7~8.1 | 110kg | fall |
| Guangxi | 7.3~7.6 | 110kg | fall | |
| Hainan | 7.0~7.3 | 110kg | fall | |
| North | Beijing | 7.5~7.7 | 110kg | flat |
| Tianjin | 7.5~7.7 | 110kg | flat | |
| Shanxi | 7.4~7.6 | 110kg | fall | |
| Hebei | 7.4~7.7 | 110kg | flat | |
| northeast | Heilongjiang | 7.0~7.4 | 110kg | flat |
| 吉林 | 7.2~7.4 | 110kg | flat | |
| Liaoning | 7.1~7.5 | 110kg | fall | |
| northwest | Shaanxi | 7.3~7.6 | 110kg | flat |
| Gansu | 7.2~7.4 | 110kg | fall | |
| southwest | Chongqing | 7.3~7.4 | 110kg | fall |
| Sichuan | 7.3~7.4 | 110kg | fall | |
| Yunnan | 7.3~7.4 | 110kg | flat | |
| Guizhou | 7.2~7.5 | 110kg | fall |
The two giants invested 10 billion and 1.6 billion respectively to build 3 million and 1 million pig projects
After the Spring Festival, the price of live pigs fluctuated and rose, but from the perspective of the breeding costs of various enterprises, the current pig prices are still hovering above and below the cost line of enterprises. However, although this round of pig cycle has not yet bottomed out, a number of pig head enterprises have invested heavily in it. Expand production against the trend.
Invest 10 billion! COFCO Jiakang bets on the rebound of pig prices to expand production against the trend
On April 18, COFCO Jiakang's 662,400 green and healthy pig breeding project in Taonan City, Jilin Province officially started.
According to the Economic Daily, the Taonan Municipal People's Government and COFCO Jiakang signed an investment cooperation agreement on the whole industrial chain of green ecological pig breeding, with a total investment of about 10 billion yuan, and the whole industrial chain project of 3 million green ecological pig breeding will be completed in phases. The first phase of the project has a total investment of 2.014 billion yuan, and will build an annual slaughter of 662,400 pig breeding bases and supporting ancillary facilities.
COFCO Jiakang Foods, the meat business platform of COFCO, was listed on the Main Board of the Stock Exchange in 2016.
The company's main business basically covers the whole pig industry chain, including feed production, pig breeding and slaughtering, production, distribution and sales of fresh pork and meat products, and import and distribution of meat products (including pork, beef, poultry and mutton).
The pig breeding segment of COFCO Jiakang includes feed production, pig breeding and pig breeding business. The company has built modern pig breeding bases and supporting feed factories in Jilin, Inner Mongolia, Tianjin, Hebei, Henan, Jiangsu, Hubei and other provinces and cities.
In the 2023 performance report, COFCO Jiakang proposed that for 2024, the company will accelerate the expansion of its core business, normalize the prevention and control of African swine fever, dynamically optimize the futures hedging strategy, and continue to promote the branding and differentiated operation of fresh food. In addition, the risk control system of import business will be further improved.
However, in the environment of sluggish pig breeding market, COFCO Jiakang's move can be described as expanding production against the trend.
CP (Qijiang) 1 million pig industry chain project was officially started
Recently, according to the news released by Qijiang, the Zhengda (Qijiang) 1 million pig industry chain project located in the eastern new city of Chongqing has also entered the flat stage, and the scene is busy. With a total investment of 1.6 billion yuan and an area of 222.2 acres, the project will build a whole industrial chain of 1 million pigs integrating feed production, pig breeding, slaughtering and processing, cold chain logistics and organic fertilizer production.
Renderings of CP (Qijiang) 1 million pig industry chain project.
It is reported that the project mainly implements a comprehensive pig processing workshop with an annual slaughtering scale of 1 million pigs and a food processing workshop project of 100,000 tons per year, and will build a leading modern food factory with a high degree of intelligence and good integration of industrial clusters. After the project is completed and put into operation, it is expected to achieve an annual output value of 4 billion yuan, a comprehensive tax of 200 million yuan per year, and more than 200 jobs.
What is the reason for the expansion against the trend at this time?
In fact, in the pig breeding industry, it is not uncommon to expand production against the trend. Since the outbreak of African swine fever in 2018, the head pig enterprises have been expanding rapidly, and even in the partial loss period from 2021 to 2022, the head enterprises are still expanding their production capacity countercyclically.
However, in 2023, the average price of live pigs in 22 provinces and cities across the country will be 15.24 yuan/kg, down 19.4% year-on-year, and the industry will fall into deep losses.
Besides, COFCO Jiakang's performance in recent years is not good. In 2023, the company will slaughter 5.2 million live pigs, a year-on-year increase of 26.7%, slightly exceeding the target at the beginning of the year. Dragged down by sluggish pig prices, COFCO Jiakang's annual revenue fell by more than 10% year-on-year to 11.568 billion yuan, marking the third consecutive year of negative revenue growth. At the same time, the company's earnings hovered around the breakeven line, and the net profit attributable to the parent before the fair value adjustment of biological assets was 51 million yuan, while the net profit attributable to the parent company adjusted according to the pig price at the end of the year was -136 million yuan.
For the contrarian expansion of COFCO Jiakang, Lei Yonghui, a senior expert in the agriculture, animal husbandry and food industry and the founder of Speculative Business, told Jiemian News that COFCO has strong capital support, has the deep processing and distribution capacity of the whole industrial chain, does not worry about the risks brought by the stage market, and attaches more importance to the long-term investment income in the future.
Xu Hongzhi, a senior analyst at Breck Agricultural Products Purchasing Network, told Jiemian News that COFCO Jiakang's development strategy in the past few years has been very stable, and the debt risk is not large. At present, the breeding project under construction in Jilin is only a phase, with a breeding capacity of 660,000 heads, and the production capacity of the project is 3 million heads.
Xu Hongzhi further said that from the perspective of the market, it is correct to expand production when pig prices are low. Generally, the construction and production cycle of the farm is 1-2 years, and after the production is just in time to catch up with the rise in pig prices, it will be directly earned. And the current pig price is not particularly bad, compared with last year, there has been a certain rebound.
Taking COFCO Jiakang as an example, from January to March 2024, the average sales price of the company's commercial pigs was 14.2 yuan/kg, 14.46 yuan/kg, and 14.63 yuan/kg, respectively, and the prices showed a moderate upward trend.
On April 19, Lei Liugong, director of the Department of Market and Information Technology of the Ministry of Agriculture and Rural Affairs, said at the press conference on the operation of the agricultural and rural economy in the first quarter that the relationship between supply and demand in the pig market in the second quarter will be further improved, and pig breeding may turn losses into profits.
"The consensus in the industry is that pig prices are likely to rise in 2024, and the difference is how big the rise will be, and the expectations for 2025 are more optimistic. Therefore, COFCO Jiakang's expansion action is logical. Xu Hongzhi said.
Shennong Group: The slaughter volume is expected to increase by 1 million heads in 2024
The pig industry suffered a comprehensive loss last year, and Shennong Group (605296. SH) is no exception, but the loss has not stopped the company's capacity expansion, following the company's slaughter of 1.52 million heads last year, an increase of more than 600,000 heads, in 2024, its slaughter volume is expected to reach 2.5 million heads. At the same time, the company plans to continue to maintain the corresponding increase in 2025.
This evening, Shennong Group released its 2023 annual report, during the reporting period, the company achieved operating income of 3.891 billion yuan, a year-on-year increase of 17.76%, and the net profit attributable to shareholders of listed companies was a loss of 401 million yuan, a year-on-year profit turned into a loss, and a profit of 256 million yuan in the same period last year.
In 2020, the company's pig slaughter volume was only 411,000 heads, and in 2021 and 2022, it will grow rapidly to 653,700 heads and 929,000 heads, and in 2023, it will further increase to 1.5204 million heads, with a growth rate of 63.66%.
When capacity expansion encounters low pig prices throughout the year, losses are inevitable. In fact, the Ministry of Agriculture and Rural Affairs has set the tone before, and 2023 is the first annual loss year since 2014, with an average loss of 76 yuan for pig breeding heads throughout the year.
However, although the market continues to be sluggish, the company's capacity expansion has not stopped. According to the financial report, a number of projects of the company continued to advance during the reporting period, including the investment in the establishment of a wholly-owned subsidiary "Guangdong Shennong Animal Husbandry Co., Ltd.", and the investment in the construction of Guangxi Chongzuo Shennong Animal Husbandry Co., Ltd. Xinlong pig farm project.
The company said in a recent investor relations activity, "the company has about 100,000 sows as of the end of February, including 85,000 sows, and with the completion and production of pig farms under construction within the year, it is expected that the sow inventory will reach 130,000 by the end of 2024." The company's slaughter target is 2.5 million heads in 2024 and 3.5 million heads in 2025. ”
It is worth mentioning that the "ultra-low" breeding cost may become the confidence for the expansion of Shennong Group at the bottom of the cycle. According to public information, the company's average complete cost in the first quarter was 14.5 yuan/kg, while the average complete cost of breeding in Muyuan from January to February was 15.8 yuan/kg.
It should be noted that the continuous expansion has led to a certain increase in the company's short-term liabilities and period expenses. According to the financial report, at the end of the reporting period, the company's short-term borrowings were 335 million yuan, compared with 0 in the same period last year, while sales expenses, management expenses and financial expenses were 65 million yuan, 291 million yuan and 870 million yuan respectively, an increase of 60.23%, 25.34% and 109.50% year-on-year respectively.
Looking forward to the second half of 2024, the relevant listed pig enterprises may usher in a period of pressure relief, and some industry insiders said in an interview with a reporter from the Financial Associated Press, "The supply and demand situation will gradually improve in the second half of this year, and the relevant breeding entities are expected to achieve small profits from small profits." ”
According to the Ministry of Agriculture and Rural Affairs, at the end of March, the national breeding sow herd was 39.92 million, a year-on-year decrease of 7.3%, with the gradual emergence of the effect of pig production capacity, the number of breeding sows, the number of large pigs and the number of newborn piglets are showing a downward trend, the supply and demand relationship of the pig market in the second quarter will be further improved, and pig breeding may turn losses into profits.
（全国能繁母猪走势图图片来源：choice）