The economics watch, journalist aruhan, sold six pigs more than 20 days ago, at a purchase price of $6 per pound, which has cost him nearly $1,000 per pig. But after accounting for a single cost, the liu feng army has to bear the pain, “the feed is too expensive to feed more.” for the first time, liu fengjun, who was a pig farmer in the xinyang district of shaanxi elin, raised pigs for nearly 20 years, felt “a little different market”。
The liu feng army has a weight in its heart, so every pig can sell $8. 5 per pound. He also remembers clearly that at the end of february 2021 he sold 16 pigs at a price of $15 per pound. Soon after, however, the price of pigs declined and it was not possible to cover the cost of $8. 5 per pound in or around september of last year, still within the line of loss。
The sword of hunan huai-chui farmers has recently been converted from pig to cow farming in one of their farms. The sword, which began to grow pigs in 2017 in cooperation with large-scale pig-farming enterprises, thought that it would be safer and more risk-resistant for the “big factory”, but it was not expected that the “large factory” would have had a difficult day and that the sword still owed hundreds of millions of dollars。
The king's sword refers to the “large factory” as the jiangxi listing company, which specializes in the production of pig farming, in the form of official technology. According to the company's previous 2021 performance forecast, a net deficit of $18. 2 billion to $19. 7 billion was projected last year, a decrease of 416. 84 per cent to 44. 96 per cent over the same period. In january-march of this year, cumulative proceeds from the sale of technical and technological goods in hong kong were 2,782 million yuan, a decline of 65. 25 per cent over the same period。
According to data from the ministry of agriculture and rural development, in july 2021 the country ended its 21-month increase in the stock of fat pigs, with a peak of 45,644 million in june, which, according to normal market patterns, will be released in april/may of this year. However, the latest outbreaks in various areas have made it impossible for the demand side of catering, tourism and so forth to properly absorb and digest the production capacity, increasing the pressure on enterprises to lose。
Whether it is the hirondau army, the wang sword's small farm, or the lead farm, it is experiencing a “special loss period” that has not occurred in the history of farming for almost 20 years。
Depth loss
On these two days, the forces seem to have seen a glimmer of hope. On 19 april, the price of the three pigs rose to $6. 6 per pound, and in the afternoon to $7. 2 per pound. If this is the rate of growth, the next batch of raw pigs will not cost more. However, the liu feng army is puzzled by the fact that, as a rule, the price of pigs varies by one or two cents a day, with a three-day increase of one dollar。
They also heard that two large farms in the next county had been selling pigs for several days, and that the increase in the price of pigs over the last few days was only a short period of time, and that it was important to reduce the loss to go back to the cage, which had heightened the concerns of the forces。
The retrofitted farm is built on the size of 1,000 pigs, and the sword, which began only in 2017, began with a more conservative “substitute” model, which replaces the cost of maintenance for large farming enterprises. The increase in pork prices in 2020 was a cause of great excitement and optimism for the company he worked with, which invested $1 million in joint ventures with friends to build new farms, bringing the total number of pigs in two farms to 2,000。
In mid-2020, new farms began production, but it was not expected that the price of pigs would start in early 2021. Adding to this is the outbreak of swine plague in one of the farms in 2021, which ended the damage with government subsidies and insurance. But the price of a pig who can't afford it also strengthens the king's resolve not to raise a pig, “i'm costing eight dollars per pound, but now i'm selling seven dollars per pound
The situation faced by listed companies, including jungbong science and technology, as well as by farmers and breeders, is summarized as “deep loss periods”. This summary also appears in the financial paper of win's shares, “a deep fall in pork prices in 2021, higher corporate farming costs and a deep loss in the pig industry”. Last year, win's share income was $6,494 million, resulting in a net profit loss of $13,404 million, a decline of 280,51 per cent over the previous year。
Depth losses refer, on the one hand, to unprecedented losses and, on the other hand, to the lengthening of the lost time line. According to the monitoring of yang lily, an information and information analyst, the domestic pig farming industry has accumulated a loss of almost eight months since june 2021, exceeding the overall loss of the next period of the previous cycle (7 months)。
To date, some of the listed farming enterprises have yet to disclose their 2021 performance, but the march sales revenues show no downward pressure. In march of this year, the maharahara shares sold 5. 986 million pigs and generated $7. 432 billion in sales, while the average sale price of commercial pigs was $11. 67/kg, a decrease of 5. 74 per cent compared to january-february 2022, compared to $23. 31/kg for the same period last year。
On 20 april, at a press conference organized by the press office of the state council, yang jinhai, director of the livestock and veterinary medical department of the ministry of agriculture and rural development, gave an introduction. On 19 april, the average price of pigs per kilogram was $12. 85, an increase of $1. 34 over the 18 march period. At present, however, pig farming has not been reduced to profit, with a loss of $327 per column in march and $153 more than in february。
Yang zhenhai further explained that, according to the expert team's predictions, three quarters of pig farming was expected to yield gains and losses, but uncertainty persisted, as the number of newborns and pigs returned to high levels and the cost of feed to low levels. In this way, the cumulative period of loss in the pig farming industry will be more than one year。
Projected shortfall
With regard to the length of the period of loss, some farming enterprises are not prepared, “at least our expectations for the consumer market are not accurate.” according to an insider of a farm company, one third of the production of pigs in the national market will flow to the catering industry and, in their case, a large proportion of the raw pigs will be purchased by the authorities, schools, etc., but the outbreak that has occurred since 2022 has had a direct impact on sales downstream, adding to the impact on farming enterprises。
According to data published by the national institute of statistics, in the first quarter of 2022, the income from catering was 10,65. 3 billion yuan, an increase of 0. 5 per cent; the income from catering above the limit was 24. 8 billion yuan, an increase of 0. 9 per cent. In march, revenues from catering fell by 16. 4 per cent to 293. 5 billion yuan, while revenues from catering above the ceiling decreased by 15. 6 per cent。
For liu fengjun, his “unthinkable” is an increase in the cost of feed. After spring, he received the latest feed offer: a bag of 40 pounds of pig feed went up from $165 to $180, a bag of 40 pounds went up from $132 to $150, and a bag of big pork went up from $180 to $210. The liu feng jun described a pig's timing as 170-180 days, and the cost of feed per pig in this cycle was $2349, plus the cost of $400 for pigs, for a total cost of $2749. However, at a purchase price of $6. 5 per pound, each pig could only sell 1950 dollars。
As to the reasons for the increase in the price of feed, the liu feng jun received an explanation from the feed sales company that the logistical costs of the fighting in the “ou” and the outbreak had increased。
According to data released by the food and agriculture organization of the united nations on 8 april, world food commodity prices rose significantly in march 2022, reaching their highest level ever. The cereal price index averaged 170. 1 points in march, the highest level recorded since 1990. The disruption of the export of wheat from ukraine and russia as a result of the conflict was the main cause。
According to insiders of the above-mentioned farming companies, the main sources of raw materials are currently brazil and argentina, which are not affected in terms of supply, but rising sea transport costs and food prices have increased cost pressures。
According to data published by the department of livestock and veterinary medicine of the ministry of agriculture and rural development and the chinese association of feed industries, the prices of maize in the first two months of this year were historically high, and the prices of other major raw materials, such as soybeans, were higher than in the same period last year. The average price of complementary feed for fat pigs in the previous two months was $3. 54 per kg, an increase of 3 per cent over the same period last year and 1. 2 per cent over the ring level last december。
Special cycle
While it was clear to the forces that the sars outbreak in 2003 was the lowest price he had ever experienced for raw pigs and the purchase price was 2. 7 yuan per pound, even then he did not lose money, because the costs of maize and fodder were low and largely even. Not much time has passed since the pig cycle。
With fluctuations in the supply-demand relationship in the market, the price of raw pigs and the market are characterized by marked cyclical fluctuations, usually between 3 and 4 years. Feng yinghui explained that the rise and fall in pork prices were dominated by market value patterns and fluctuated with changes in market supply and demand. However, the volatility experienced by the domestic pig farming market since 2019 has been largely influenced by factors outside the market, showing a sharp rise in the price of meat to historical highs and a steep decline to lows。
The african swine plague, which began in august 2018, was the first to affect the domestic pig farming industry, which, according to data published by the national statistics office, produced 42. 5 million tons of pork in 2019 and 2020, down from 5. 04 million tons in 2018。
According to data from the ministry of agriculture and rural development, in june 2021 the country ended the 21-month increase in the number of capable mother pigs, reaching 4. 56 million. According to normal market patterns, this capacity will be released in april/may this year. Feng yong-hui described how, at the conventional consumption rate, the year before may is a lean season for pork consumption, but this year’s specialty is the weakness of demand, which also creates more uncertainty about the price of pork and the future of enterprises。
There seems to be some change in behaviour. As observed by the liu feng army, domestic pig prices have shown a low upward trend since mid-april, with a marked increase in local markets. As of 19 april, the average price of the three foreign dollar transactions monitored by chul-chui had risen to $13. 78 per kg, an increase of $1. 2 per kg, or 9. 54 per cent, at the beginning of the month, and a multi-terrestrial daily increase of $0. 8-1. 0 per kg。
On the demand side, however, until 15 april, when prices rose rapidly, the rate of start-up in domestic slaughtering enterprises remained almost stable at 31 per cent, while the number of slaughtering enterprises did not rise during the price hike. According to yang lily, an information and information analyst, the impact of the epidemic, the poor circulation of pigs in the country, the difficulties of off-farming pigs in some of the main areas, and the high expectations of farming, make this wave of price increases only considered emotional and difficult to sustain。
In the register of investor relations, published in early march, the representative of the qin military hospitality company, secretary of the board of directors, concluded that, at this stage, marginal changes in supply have a greater impact than marginal changes in consumption, and that the main contradiction remains the relative oversupply. However, there has been a hf outbreak of new coronary pneumonia in the last year, and there has been a clear spillover of the consumption and catering end, affecting current pig prices, which the company expects to improve in the second half of the year。
(as requested by the interviewee, the liu feng army and the wang sword are aliased)
