Himfr states that 2010 pork prices will not experience excessive fluctuations. The average live pig price is RMB 13/kg; pig production in general will be profitable.
Himfr analyzes that based on the 2009 live pigs market, pork retail prices will be maintained at current levels.
It is reported that in 2009, the market price of live pigs and pork prices dropped continuously to around mid-May, and once the pig to grain price ratio was even less than 6:1, so the state initiated the policy of regulating the market price of live pigs, through stock of frozen pork, to stabilize the price of pigs. Despite some price fluctuations, pig production is profitable overall, the each pig can profit about RMB 130.
The price of live pigs and pork fluctuated in November 2009, but this stage price fluctuation is mainly because of increased year-end demand, coupled with rising food commodity prices driven by linkage effects. Pork prices have risen to a certain extent, but as the stage of consumption goes down, prices should continue to fall, but not in sharp decline.
As long as there are no major epidemic outbreaks in 2010, there should be no problem in the supply of live pigs, and the prices will be more stable. In addition, breeding pigs will be profitable, but the current level of profits is limited; each pig's profit is less than 10%, which will not stimulate investors to massively increase the supply of live pigs, forcing prices down.
