I'll kill you! In the last two days, the national price of raw pigs has rebounded, but it is still in the middle of a loss zone for the majority of people; but the price of pigs and pigs is still “shocking up”, with seven kilos of pigs and pigs now rising by about $100 per head at a lower point than at the beginning of the year, and with a strong desire on the part of farmers to rob pigs and a big move on the part of makihara and wenze.
Porks and pigs are going up $100
According to information from drazen, as at 16 february 2023, the average price of 7 kg of piglets in the country was $432. 89 per head, an increase of 18. 23 per cent over the previous year. The market feedback from farmers has shown that the price of pigs has been rising in recent years, and that in many regions the price of pigs has risen by over $100 compared to the beginning of the year! The average price is higher in north china and lower in south west china.
Intuitively, the price of pigs reflects the expectations of the farmers with regard to the post-market situation. Although the current price of pigs is still at a loss of $200-300 per pig in large numbers, it is clear that people are already watching and betting on the next half. It's just that we need to be wary of the fact that, as the price of pigs rises, the following factors must be taken into account to avoid business risks。
One is the reason why the prices of pigs have risen so strongly, and there is a perception in industry that behind the sudden rise in prices of pigs and pigs may be someone who's engaged! After all, the current prices of raw pigs are not clear, and market confidence has been boosted somewhat “upfront”; and in the light of changes in the total number of able-bodied pigs, the “robbery” in 2022 went from april to december, rapidly rising from 41. 77 million to 43. 9 million, and eventually significantly exceeded the normal level of storage。
A lot of pig webs have also noticed that in 2022, the amount of feminine storage began to exceed normal holdings at the end of august, and then there was a spill of 9, 10, 11 and december, which means that in recent months, the pig production capacity has not been low, and there is even a high risk of excess
As for the term “false pig”, the general interpretation in the industry is that “the pig is not interested in the post-market situation, and therefore the price of the pig is high and the risk of a foreign operation is transferred”。
And the premise of being a pig is to prejudge the second half of 2023. So the question is not whether or not the current price of pigs is made up, but where the price of raw pigs is going to go in the second half of the year, and whether it's profitable for you to buy pigs at this price
Pork price rebound “cut-off date”
In terms of 16 yuan/kg, the low price of pigs has been running for about three months, and the losses for a large number of second-generation fertilizers are more than five months old! Everyone is waiting for a complete rebound in pig prices, so when will that rebound occur
In the next cycle of the price of pigs, the price of pigs tends to go down and up, making it hard to see how the post-market situation is; but the price of pigs also has a “minimum threshold” that never crossed! Once the price falls close to this line, it will then begin a real rebound, allowing the pig-rearing to gradually return to profit。
This line is the “$10 pig price”, reviewing changes in the price of pigs over the last decade, and it is not difficult to find that six of these have approached or touched the bottom line of the “$10 pig price” in late april 2014, late march 2015, late march to late may 2018, early february 2019, early october 2021 and late march 2022。
Every time a pig's price falls to the bottom of $10, a lot of people are almost desperate about the back-market situation, but just after this drop, the pig's price starts to rebound strongly! Of course, pig prices do not always fall to $10/kg to rebound, and there are many cases of early rebounds。
On the basis of these conclusions, we can clearly judge —
Today, the price of pigs has dropped to about $15/kg, and there have been signs of a rebound in the price of pigs in the last two days, so that there are only two possibilities for the future: first, that the price of pigs has rebounded at a low point of $15, and that the price of pigs will begin to show results in early march; and second, that the price of pigs has reached its bottom within three months, with a strong rebound in the second half of the year。
In conclusion, the “cut-off” for the rebound of the price of pigs is june, and the price of pigs is still at risk until june. How can it take another three months to see a lot of people rushing
On the one hand, the combination of past-period pig prices is known, and it often takes 3-4 months for the price to drop from $15 to $10, although the rate of increase and decline in the price of pigs has accelerated in recent years, so it takes up to 3 months to reach the bottom of this year's pig price curve, not excluding the possibility of reaching the bottom within 3 months
On the other hand, a short-term rebound of pig prices, if not complete, would be a dangerous signal! Mr. Wang has shared this a few days ago that the pig is in the “touching period” and the price of the pig is still at the bottom, which means it is still far from falling! Especially in this case, a lot of people are getting emotional, starting to push up prices and even having second-time fertility, and these operations will prolong the low price of pigs, which is not good for business
In short, there's no need to ask if the price of pigs can rebound in the second half of the year. There's no doubt about that. It's just that in the short term, we have to be careful, we can't keep the stakes up. But in the long run, it's not impossible to get out-of-home pig fat, and whether or not there's a job, the main criterion for our determination is whether or not to buy out out-of-home fat is whether you can account for the cost of eight cents per pound.
8-dollar cost, death line
It must be acknowledged that the price of pigs is still at a low level, although it has risen significantly
Because for the vast majority of pigs, $432. 89 per head is still a “loss of money”; except for the rangeland, where weaning is at around 320 per head, most others, like wein and new hope, are at over $400-450 per head
So the price of pigs is still not very high at the industry level as a whole, except that it has rebounded significantly in the last two days, making it easier to push up the price of pigs even further, allowing farmers to be emotionally more sensitive to the post-market situation and actively campaigning for pigs. Do you want to buy a pig or not? The key to this is if you can keep the final cost of the pig's fatting up to $8 per pound。
Looking back at 2022, new hope lost between $410 and $610 million, while wine earned $5. 22 billion. Behind this gap is a nuance of the costs of the two pigs
New hope cost around $9. 4 per pound in the first quarter of 2022, down to $8. 35 per pound at the end of the year
The cost of the first quarter of 2022 was approximately $9. 00 per pound, and gradually fell to $8. 05 per pound in the third and fourth quarters。
It is not difficult to see that the cost gap between the two pigs is not large, and it can be said that it is around $0. 3 per pound for the whole year, but because of their large volume, it eventually leads to billions of dollars and a loss of 410 million. It is important to note that the deficit of $410 million in the new hope of 14. 6 million in 2022 is not significant
In addition, according to mysteel, in 2022, both self-supporting heads earned around $280. 04 per head, while imported pigs earned about 331. 12 per head! This “aberration” is due to the fact that a large number of children and pigs have lost their jobs in low-intensity situations and have borne some of the costs of the fertilizer farms。
The year 2023 will be better than the year 2022 as a whole, so for this year we only need to ensure that the cost is within $8 per pound and that there is great hope for full year profits
It is clear that 2023 is still a promising year for a cost-effective pig. And so hermits and windsor took the lead
On february 17th, windsor announced an employee incentive programme, which plans to award a restricted stock of 18,509 million shares to more than 4000 people, while the target for 2023 is a 20% increase in the total sales weight of animal products compared to 2022, or a net profit of not less than $7. 5 billion to the mother
Makihara also announced that capital spending this year is expected to be in the range of $10 billion to $15 billion, including farm farms, slaughterhouse construction and related repair and renovation costs. There will be a further increase in the capacity of the rangelands and a possible increase in the amount of $15 billion in inputs
In short, whether or not pigs are purchased externally, the cost is the main indicator of whether pigs can make money by 2023, and no matter what the farming model, as long as the efficiency reduction is achieved, it is not necessary to consider whether to push the bar in the short term, but rather that gambling increases the risk of doing business! After all, pig farming is a long-term profit-making enterprise, with a determination to make a breakthrough internally, and a lasting profit。
