by Lyle L. Jones, Director of Sales in China
The first reported case of ASF broke on August 3, 2018, in China. Despite significant losses of production, the slaughter pig price remained stable during the first half of 2019 as a result of increased flow to slaughterhouses, built up of cold storage and increased pork Imports.
Pig and Pork Prices Set Historic Records in China
After the flow of pigs to slaughter began to dry up in June, live pig prices began to rise sharply until the end of October 2019. After a slight drop in November 2019, the price reached its peak at RMB 38.3 yuan per kg ($2.45/lb) in February 2020 after the Chinese New Year.
To stabilize the pork price, the central government implemented a series of measures to stabilize the supply. Pork imports grew rapidly in 2019 with the total importation reaching 2.108 million tons representing a 75% increase. Meanwhile, the central reserve released 140,000 tons of frozen pork in a further effort to stabilize the supply and pork prices.
Sow Inventory and Pig Production Output Over the Last 10 Years.
The breeding sow inventory in China has been declining year by year over the last 10 years. However, the output of the slaughter pigs remained relatively stable due to increased production efficiency until they drop in 2019 due to the ASF outbreak.
Production Sow and Pig Inventories Increase Over the Last 5 Months.
The number of production sows in February 2020 increased by 1.7% month-on-month according to the monitoring of 400 designated counties all over the country. It is five consecutive months of growth month-on-month. That is a 10.0% growth compared with last September. The breeding sows inventory is reported to continue increase in 27 provinces.
Outlook for 2020
Driven by the strong demand for pork of the Chinese people, record prices and billions in policy incentives, the confidence of pig producers has been greatly enhanced.
- Giantstar will invest 2.9 billion yuan to build one million hog production system in Ya’an city of Sichuan.
- Suining county of Jiangsu province invites Wens, New Hope, Zhengbang and Muyuan to build new pig farms in the regions, a total of 3.3 million hogs per year.
- Chongqing Dazheng Animal Husbandry Ltd is building 3000 sows’ farm in Hechuan County of Chongqing, aiming to produce 70,000 hogs per year. The list of new investments goes on.
To further support the hog production following ASF, China recently released a statement encouraging Chinese Companies to ”go global” and establish pig production bases in other countries with a good food safety practice and no ASF.
The biggest challenge is finding high-quality breeding stock to resupply the breeding herds needed to rebuild China’s production systems. Unfortunately, there is a global shortage of breeding pigs to draw upon. Genesus is here to help China’s producers resupply their breeding farms with the highest quality genetics from the World’s Largest Purebred Registered Nucleus Herds.