According to the National Bureau of Statistics report, at the end of the first quarter, it reported the pig inventory in China was 415.55 million, an increase of 29.5% year on year. Among them, there were 43.18 million sows, an increase of 27.7% over the same period last year.
What is the short-term outlook going forward?
There seems to be some debate upon the anticipated pig price in the second half of 2021. Some sources say the price will continue to drop as production capacity continues to increase. Other analysts believe the price may spike back up the 3rd or 4th quarter after the surge of pork going to slaughter caused by the most recent wave of ASF and the domestic supply tightens back up again.
We would expect construction of breeding and production farms shall continue driven by high prices and enticing profits.
Perhaps the two biggest challenges will be ongoing disease (not necessarily mortality, but reproductive performance and growth) and poor quality breeding pigs.
We have heard many farms sitting empty again after depopulation, cleanup, and disinfection, waiting for the right time to repopulate.
How does using crossbred commercial gilts in place of high-quality breeding pigs affect production?
The common practice employed by virtually all major producers faced with a lack of quality breeding pigs in China is to save back crossbred gilts from their commercial farms to populate their breeding farms. Reports from the field attest to a 20-25% lower reproductive performance of crossbred commercial gilts compared with quality breeding pigs. In other words, the production and performance of these commercial gilts (normally slaughter pigs) is only 75-80% of the higher quality breeding pigs they are replacing.
If we do the math assuming China’s sow inventory prior to ASF was 37 million sows x 0.75 = 27.75 million sows resulting in 10 million sow loss of productivity. Couple that with slower growth and performance – a significant headwind to full recovery.
Fortunately, Genesus is here to help producers restock their breeding farms with the highest quality genetics with Nucleus Source farms registered for export to China from Canada, United Kingdom, and the USA. In addition, Genesus has partnered with a number of companies in China to produce Genesus Brand breeding pigs under Genesus Genetic program and make them available to the domestic market.