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Pig production continues to recover, prices starting to fall
Since the third quarter, with the continuous recovery of live pig production and market supply, pork prices have turned from rising to falling. Since the end of July, they have maintained a trend of small fluctuations and declines for more than two consecutive months. According to monitoring by the Ministry of Agriculture and Rural Affairs, in the second week of October 2020, the national pork wholesale market averaged 44.42 yuan per kilogram, down 2.9% month-on-month and 9.5% year-on-year.
According to statistics from the General Administration of Customs, pork imports from January to August were 2.91 million tons, a year-on-year increase of 133.7%, which has exceeded the total pork imports in 2019.
With the improvement of the prevention and control of COVID-19, social and economic activities have steadily recovered, and the demand for pork is expected to gradually increase to a normal level. The fourth quarter is the peak season for traditional pork consumption. The tension between supply and demand will gradually ease, and there is little possibility that pork prices will rise or fall sharply.
Wheat prices rising steadily
Supported by multiple favorable factors, wheat prices have risen steadily. The price of corn has risen by a large margin, and the demand for wheat feed has increased, which has a significant impact on prices. Due to the impact of the COVID-19 epidemic, the market's bullish expectations have increased, some large grain farmers and traders are reluctant to sell, and short-term grain sources are tight.
Since mid-July, the state has increased the minimum purchase price of wheat, and the market has sufficient grain supply. In September, ordinary wheat at the Zhengzhou Grain Wholesale Market was 1.20 yuan per catty, up 0.7% from the previous month, and 5.9% higher than the same period last year. At present, the country’s total wheat inventory exceeds one year’s consumption, and the government’s ability to regulate reserves can fully guarantee the supply of rations in the market.
According to customs statistics, wheat imports have increased significantly from January to August. China’s cumulative wheat imports were 4.99 million tons, an increase of 137% over the same period last year (Jan-Aug).
Corn and soybeans
Driven by demand growth and market speculation, the price of corn has continued to rise. In August, the average wholesale price in the production area and sales area reached 2270 yuan and 2444 yuan per ton respectively, but the price has shown a certain seasonal decline. The monthly average wholesale price in September is 2222 yuan per ton, down 2.1% from the previous month. The price is expected to remain stable in the short term or fall back slightly.
Since August, the price of domestic soybeans has fallen from a high level. As of September 25, 2020, the State Reserve soybean auctions had a total of 1.188 million tons, of which 998,000 tons were sold in the third quarter. The domestic soybean market supply has increased significantly. As soybean production is expected to continue to recover this year prices may continue to fall from high levels.
October 15, 2020/ Ministry of Agriculture and Rural Affairs/ China.
