baccaratmen| Things have changed and the south pig has become the new normal

Wang Yanan, a pig market analyst at Zhuochuang Information

[introduction] in the past five years, the price of pigs in the south was higher than that in the north for a long time, and pigs were mostly transported from the north to the south. Since the second half of last year, the northern region represented by Shandong has gradually entered a state of reduced supply, pig prices have risen, and the proportion of pig demand in other provinces has been increasing. In the near future, affected by the second breeding in the north, pig prices continue to rise, further stimulating the enthusiasm of the south-to-north transfer. With the recovery of production capacity in the north and the gradual easing of the supply imbalance between the north and the south, the phenomenon of south-to-north pig transfer may be weakened.

oneBaccaratmen. change in the direction of pig transportation in 2024

Under normal conditions, the market price of pigs in the south is higher than that in the north in most of the time, and most of the pigs in the north are transferred to the south. According to the monitoring of Zhuochuang Information data, from 2020 to 2023, the average trading price of lean pigs in 22 key provinces gradually increased from north to south, in which the pig prices in the north were all below the national average price, while most of the southern regions were above the national average price. At this stage, the highest price in China is 23.45 yuan / kg in Zhejiang, the second high is 23.36 yuan / kg in Guangdong, and the lowest is 20.57 yuan / kg in Heilongjiang. The price difference between Heilongjiang and the above two provinces is 2.87 yuan / kg and 2.79 yuan / kg respectively. At that time, there was a certain profit in the transfer of pigs from the north to the south, and pigs from the main producing areas such as Hebei, Shandong and Henan were transferred to Jiangsu and Zhejiang, Sichuan and Chongqing, Jiangxi and even Liangguang from time to time, while the transfer of pigs from the northeast to Beijing, Tianjin, Hebei, Shandong, Henan and other places is also more common.

However, since the second half of last year, individual regions in the north, represented by Shandong, began to eliminate production capacity ahead of schedule and reduce the supply of live pigs. after entering 2024, the effect of reducing production by retail investors in the north appeared. Pig prices in Hebei, Shandong, Henan, Shanxi and other places are higher than the national average price, of which Shandong has become the second highest price province in the country. At the same time, the areas with abundant pig sources in the south, such as Sichuan, Chongqing, Yunnan, Guizhou and Guangxi, have been reduced to low-price areas, and Yunnan has become a price depression. In this case, the transportation appears in the opposite direction, such as "live pigs out of Sichuan", "south-to-north transfer" and so on.

2. The heat of the short-term south-to-north pig transfer starts again.

In mid-May 2024, the proportion of live pigs in some key pig producing areas in the south increased. The reason for this phenomenon is mainly due to the resurgence of the heat of the secondary fattening in the north, some medium pigs and standard pigs are sold in the form of secondary fattening pigs and returned to the secondary fattening pen, and the number of standard pigs supplied to the slaughtering end is correspondingly reduced, and the price of secondary fattening pigs is higher than that of conventional pigs, so the rise of secondary fattening has a strong supporting effect on pig prices. The current round of secondary fattening first rose from the northeast, and farmers in Heiji Liaoning took the lead in raising prices, rising 1.66 yuan / kg, 1.44 yuan / kg, 1.58 yuan / kg and 1.60 yuan / kg on the 15th-23rd, and quickly led to a rise in pig prices in the north, thus making the southern market, which had room for price reduction, to follow the rise. The number of standard pigs and secondary fattening pigs transferred to Shandong, Henan and other places such as Jiangxi, Hunan and Hubei have all increased, of which most of the number transferred to Shandong is mainly affected by the price difference, while the transfer to Henan is better than the short transfer radius to make up for it to a certain extent.BaccaratmenThe situation where the price difference is small. Only in Sichuan region, due to the large price increase in the past two days, the price difference has been narrowing, and the proportion of transfers has been reduced.

Since January 2023, the data of sample farming enterprises in China has been expanded to 196 by Zhuangchuang Information Monitoring, in which the changing trend of production capacity in the north and south can also be reported that the supply of live pigs in the north is decreasing at present. According to the proportion of sow stock in large sample enterprises monitored by Zhuochuang Information, the proportion of sow stock in northern sample enterprises showed a fluctuating downward trend in 2023. By August, the proportion of sows in northern China has dropped by 1.39%. This data corresponds to the number of live pigs in May, the decline in pig supply in the north, abundant supply in the south, and upside down prices in the north and south. Thus the phenomenon of south-to-north pig transfer is formed.

Zhuochuang Information Monitoring data found that the decline in the proportion of northern fertile sows continued until January 2024, with a cumulative decline of 2.91 percentage points. From the production capacity data, the decline in the supply of pigs in the north may continue until the first half of the fourth quarter of 2024. From the proportion of pig stock data, the proportion of live pig stock in the north increased by 0.48% in 2024, corresponding to the pig supply in the next six months.

This data is slightly different from the feedback from the stock of fertile sows, mainly because when the pig supply in the south is more abundant, some pig sources are transferred to the north at the piglet stage, which alleviates the pig shortage in the north to a certain extent. the tight supply of pigs in the north may be alleviated in the second half of the year, so as to continuously rebalance the supply pattern between regions. On the whole, the situation of the south-to-north transfer may continue to the third quarter, and the situation may decrease in the fourth quarter. With the gradual recovery of production capacity in the north, this phenomenon may be further weakened in 2025.

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