China’s Pork Prices Plunge to Eight-Year Low Amid Severe Glut
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China’s wholesale pork prices have plummeted to nearly an eight-year low, prompting government authorities to escalate market interventions amid a severe supply glut and sluggish consumer demand.
The national average wholesale price of pork fell 1% from the previous day to 15.3 yuan ($2.22) per kilogram on Tuesday, according to the Ministry of Agriculture and Rural Affairs. Caixin data shows that since June 2013, average prices have only dipped below the 16-yuan mark once, in May 2018. In the week from March 20 to 26, prices dropped 23.4% from the same period last year.
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- China's wholesale pork price hit 15.3 yuan/kg ($2.22), near 8-year low, down 23.4% YoY in late March week.
- Supply glut from 39.6M sow inventory (101.6% target), heavier pigs (retail 144.6kg, +8.5kg YoY), +17.6% planned slaughter.
- Government cuts sow target to 36.5M (-7.8%), mandates controls, buys 10,000 tons; recovery lag up to 10 months.
- Nanhua Futures Co. Ltd.
- Nanhua Futures Co. Ltd. reported a "supply flood" in China's pork industry due to high breeding sow inventories and rising slaughter volumes. It cited the government's plan to cut the normal sow inventory target by 7.8% to 36.5 million head and noted that capacity reduction measures will take up to 10 months for impact.
- Huashang Reserve Commodity Management Center Co. Ltd.
- Huashang Reserve Commodity Management Center Co. Ltd., which manages China’s state meat reserves, purchased 10,000 tons of frozen pork for central reserves on March 4 and guided local governments to boost their stockpiling amid falling pork prices.
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