After a period of consolidation, hog prices continued to rise.
Data from China Pig Network shows that on June 11, the price of live pigs (external three yuan, the same below) was 15.99 yuan/kg, and rose to 16.3 yuan/kg by June 14.
Zheshang Futures Research Center Agricultural Products ( 000061 , told the 21st Century Business Herald reporter that after the Dragon Boat Festival, the breeding end has loosened, and the enthusiasm for slaughtering of live pigs has increased, resulting in a drop in pig prices. However, after the price fell, the willingness of farmers to sell at a higher price rose again, the supply of pig sources shrank significantly, and the national average price rose to more than 16 yuan/kg.
In the context of the continuous rise in pig prices, entering the second half of 2022, the impact of pig prices on the CPI (Consumer Price Index) will change to some extent. From the perspective of May, the current pig price affects the CPI rise month-on-month, and the year-on-year impact on the CPI decline. However, due to the gradual decline of pig prices from July to October 2021, the impact of pork prices on the year-on-year CPI may turn into a year-on-year increase in the CPI.
"Especially, the price of pigs in September 2021 is relatively low. In September this year, the price of pigs may increase the CPI year-on-year. It is more obvious." CITIC Construction Investment ( 601066 ), told the 21st Century Business Herald reporter said.
However, Li Sujie, a pig industry analyst at Zhuochuang Information, told the 21st Century Business Herald reporter that although pig prices in the second half of the year may affect the year-on-year increase in CPI, the magnitude will not be too large. "At present, the number of breeding sows is still normal, and the possibility of a sharp rise in pig prices is low."
Pig prices enter a rising channel
At present, the price of live pigs has entered a rising channel and has stabilized at 16 yuan/kg.
Li Sujie pointed out that the price of Zhuochuang Information on June 14 showed that the price of live pigs was 16.28 yuan/kg. Behind this round of pig price hikes, on the one hand, there are factors that retail investors are reluctant to sell, and on the other hand, there are factors of tight market supply, especially since the output of large-scale factories this month is not much.
"On the whole, the supply of live pigs in the second half of this year is in a state of reduction, but this round of price increases is indeed large, and the emotional factors behind it are more accounted for. Considering the current secondary fattening pigs, we predict that in June or July The monthly slaughter may put pressure on pig prices, but the overall impact will not be great, because from the perspective of production capacity, the supply is still tight." Li Sujie said.
"The recent rise in the price of live pigs is not just a rebound, but a natural trend of rising after a new round of pig cycle opens an upward channel." Wei Xin said.
He further pointed out that due to the better prediction of the overall market, the timing of the rise is almost always ahead of market expectations.
"For example, we expected the price of pigs to bottom out and rise in May and June, but the time point was advanced to April; later we expected that the price of pigs would rise significantly in July and August, but the current time point was advanced to June. Since the breeding sows began to degenerate significantly in July and August last year, the production cycle of live pigs is 10 months. Correspondingly, it is now the time when the supply is relatively tight, so the price of live pigs will have a cyclical support. "Wei Xin pointed out.
However, behind the rising price of live pigs, consumers are also beginning to feel the pressure of rising pig prices.
Li Ting (pseudonym), a consumer in Foshan, Guangdong, told 21st Century Business Herald that when she went to the vegetable market to buy pork, a small piece of lean meat cost her 16 yuan. "When I asked the meat stall owner why pig prices are so expensive now, he told me that pig prices 'have already gone up'."
Wei Xin pointed out that consumers are currently more sensitive to pig prices. He said that after the price of baitiao pork rises to 20 yuan, it will begin to affect consumers' willingness to consume, and the current average price of baitiao pork is 22-23 yuan.
"This will suppress pork consumption to a certain extent. In the follow-up price increase, we need to pay close attention to consumers' acceptance of price increases at the terminal. At present, although the price of live pigs is rising, the price of white pork is under pressure, so we look at the future. The price of live pigs should still be in a tug-of-war process. Of course, after the seasonal trough of consumption has passed, the superimposed cyclical production capacity declines. In July and August this year, there is still a chance for pig prices to continue to rise.” Wei Xin said.
In fact, compared to hog prices, piglet prices have risen more strongly since March. Wei Xin said that compared with the price of live pigs, the price of piglets has been in a rising cycle since March, and now it has risen to more than 500 yuan per head, but the cost of piglets is high, because the production of piglets is only at the beginning of profitability. At present, due to the gradual recovery of reproductive sows, the supply of piglets is relatively sufficient, so the price of piglets has also reached a bottleneck. unless spot The increase in piglet prices will come under pressure
"At present, the price of piglets has risen to nearly 600 yuan per head, which has limited profit space for relevant farmers. In addition, the price of piglets in the early stage has risen rapidly, because the replenishment in the early stage can just catch up with the high price before the Spring Festival. The enthusiasm of the people has been decreasing." Li Sujie said.
Wan Xiaoquan pointed out that the current sow price is relatively stable, and the piglet price has dropped slightly. Overall, the market is still optimistic about the follow-up price performance. However, recent data from some information websites shows that the number of breeding sows has rebounded in May, which has put pressure on prices in the future.
How much does pig price affect CPI?
According to data from the National Bureau of Statistics, the consumer price (CPI) in May 2022 rose by 2.1% year-on-year, of which the price of livestock and meat fell by 12.9%, affecting the CPI by about 0.46 percentage points, of which the price of pork fell by 21.1%, affecting the CPI by about 0.34%. percent. However, from a month-on-month perspective, pork prices rose by 5.2% month-on-month in May, affecting the CPI rise by about 0.06 percentage points.
However, the continuous year-on-year decline in pig prices has now come to an end.
On June 14, the National Bureau of Statistics released the market price changes of important means of production in the circulation field in early June 2022, of which the price of live pigs (external three yuan) was 15.8 yuan/kg. In mid-July, mid-August, mid-September and mid-October 2021, data from the National Bureau of Statistics showed that the price of live pigs (external three yuan) was 15.6 yuan/kg, 14.9 yuan/kg, 12.4/kg and 12.8 yuan/kg. Yuan/kg.
According to data from the Ministry of Agriculture and Rural Affairs, on June 14, 2022, the average price of pork in the national agricultural wholesale market was 21.05 yuan/kg, an increase of 0.7% from the previous day. On September 30, 2021, the average price of pork in the national agricultural wholesale market was 18.83 yuan/kg.
Considering that the current pig price is in the overall upward channel, the impact of pig price on the CPI may change from the current year-on-year impact on the decline and the month-on-month impact on the rise to an increase in either the month-on-month or year-on-year impact.
"From a year-on-year perspective, due to the relatively large fluctuations in the overall pig price last year, for example, in September 2021, the pig price was relatively low, and the CPI may be affected by the pig price year-on-year increase. However, after October, the live pig price rebounded significantly , it will not have much impact on the CPI. Therefore, in the future, the impact of pig prices on the CPI will have a stronger trend of increasing month-on-month, and there will be fluctuations year-on-year.” Wei Xin said.
Wan Xiaoquan pointed out that due to the large weight of pork in the composition of the CPI basket, under the premise that the base period and weights are not adjusted, the fluctuation of pork prices will have a greater impact on the CPI. rise to a certain extent.
From the perspective of overall food prices, the current impact on the CPI tends to be moderate. In May, the prices of food, tobacco and alcohol rose by 2.1% year-on-year, affecting the CPI rise by about 0.59 percentage points.
Wan Xiaoquan said that from the current point of view, the prices of fresh fruits, vegetables, eggs, etc. have been adjusted to a certain extent compared with the first quarter, and the prices may rebound to some extent in the second half of the year, but due to the good supply side, the increase is relatively limited. CPI is expected to rise moderately in 2022.
Wei Xin believes that the overall weather this year is not good, but after entering the summer, it is a time period with relatively rich products. Whether it is vegetables or fruits, the new listing volume will increase, which will have a certain restraint on the price.
"In addition, everyone's food consumption is not particularly strong in summer, and the impact of summer food prices on CPI is limited, but it needs to be observed when entering autumn and winter, because this year's rainfall in the south, floods and droughts in the north, if the weather does not improve, food prices in autumn and winter may rise. There will be periodic fluctuations, which will have a certain impact on the CPI." Wei Xin said.