The demand slump has led to reduced slaughter rates as households curb spending amidst economic uncertainty. “Supply pressure still exists in the market with no obvious improvement in demand…. Supply and demand is at a stalemate,” said Beijing-based agribusiness consultancy Boyar, highlighting ongoing challenges in balancing production and consumption.
For the first nine months of 2024, pork production was down 1.4%, reaching 42.4 million tonnes, while the number of hogs slaughtered declined by 3.2% to 520.3 million. Additionally, China’s pig herd size was reported at 426.94 million head by the end of September, a 3.5% decrease from the previous year, aligning with government targets to address an overcapacity issue that has weighed down pork prices.
Despite this, some livestock companies saw profitability in Q3 due to destocking efforts and cost-saving strategies that helped stabilize hog prices. Yet, demand limitations have capped the price rally, with cash hog prices recently falling to a four-month low of US$2.41 per kg after reaching US$2.95 in August, according to MySteel data. The sow herd was also impacted, with a 4.8% drop to 40.36 million as of August, as indicated by China’s agriculture ministry.
This combination of weak consumer demand, government-backed herd reduction, and cautious market responses underscores a pivotal period for China’s pork industry as it navigates the complex challenges of economic pressures and structural adjustments.
swineweb.com