Price summary

In Hunan province, piglet prices were slightly higher after the pig disease outbreak was brought under control.

Market analysis

Key characteristics of China's piglet market during the week under review were as follows:

Farmers' interest in taking up piglet supplies varied from region to region. In the north, farmers were mostly concerned over the possibility of pig diseases which are likely to occur in autumn. Going forward, lower temperatures will also slow the rate of fattening hogs, and this has discouraged some farmers from taking up supplies.

The temperature in southern China's winter will still be higher than those in the north. Other than in the areas affected by pig diseases, farmers' interest in buying piglets are still higher.

In the initial period of the pig disease outbreak, many hogs and sows had succumbed to the disease. Traders and meat processors had thus seized the opportunity to bargain for very low hog procurement prices. This had affected farmers' interest in taking up piglet supplies, and piglet prices were slightly lower even in the unaffected areas during the first half of the week in review.

Earlier, the pig disease had also killed many hogs, especially in farms with big herds in parts of Hunan province. After authorities there had rolled out measures to bring the outbreak under control, piglet replenishment activities had started to recover.

Meanwhile, deliveries of piglets to other regions had also increased. In regions where piglet inventory had been low, farmers were seen more active in taking up piglet supplies.

By making piglet replenishment during this period (late August to September), farmers were hoping to bring in profits early next year as piglets would have fattened sufficiently to be sold as hogs during the Spring Festival (Feb 18) in 2007.

Parts of south-western China continued to be plagued by a dry spell. With temperature hovering around 40 deg C, farmers there were less active in taking up piglet supplies.

Market forecast

As measures to control the pig disease takes effect, analysts expect piglet replenishment in regions previously affected by pig disease to pick up.

In the week ahead, piglet replenishment activities are expected to pick up in southern China, while those in the north may not increase much. Overall, piglet prices are seen stable.