China's pig herd is down by 60 million head
Inside sources from China's pig industry affirmed that the estimate swine feed tonnage countrywide is down 10% from a year ago. That also means a decline in the world's largest pig herd, according to Jim Long, President-CEO of Genesus Inc., Canada.
"Last week a good source in China’s feed industry told us that the estimate swine feed tonnage countrywide is down 10% from a year ago. This we expect in a combination of 1.5-1.7 million sows liquidated due to low prices prior to African Swine Fever (ASF) outbreak. The rest we expect is from ASF complications. 10% would be roughly 60 million fewer pigs over a year. That's a big number!
As we go forward the hog prices in China will be the indicator of supply. Currently, it stands at about CNY13.3 per kilogram ($1.92). Any price surge would indicate a further cut in supply in China due to transport restrictions. There is a range CNY10 ($1.45) to CNY19 ($2.75) from province to province translated in a $150 per head difference. Some provinces are making huge profits; other provincial producers are losing big. We expect major liquidation ongoing in low market price provinces", declared Mr Long.
In the last 4 months, China has been confronted with more than 90 ASF outbreaks but there are suspicions that not all the cases have been reported through the official channels. Currently, 22 provinces in China have reported ASF outbreaks.