Favorable factors
The chain reaction caused by pig price diving prevented the increase of sow stock in time: the chain reaction caused by pig price diving: the decrease of breeding profit-the decrease of enthusiasm of commercial piglets-the decrease of piglet price-the decrease of enthusiasm of sows-the decrease of sow stock growth rate, and some farmers eliminated productive sows, which greatly reduced the pressure of oversupply of pigs in 2009.
The decline in the price of feed raw materials has led to a decline in the cost line of live pigs: since the second half of 2008, with the decline in the prices of feed raw materials such as corn and soybean meal, the cost line of live pigs has also declined, so the loss of live pigs has also decreased.
Macro-policies to support pig production: At the end of 2008, the central government issued 4 trillion yuan to stimulate domestic demand, and at the same time promulgated and implemented a new land policy, with more policies and funds tilting towards agriculture. As the main body of animal husbandry, pig industry may get greater support at that time.
The number of large-scale farms has greatly increased, and the risk awareness has been significantly enhanced: after baptism in 2006, 2007 and 2008, a large number of free-range farmers withdrew from the pig industry, and the proportion of large-scale farming increased. At the same time, last year's super-high profits made the financial strength of the surviving pig farms increase sharply, and more new scale farms appeared like mushrooms after rain. Engaged in pig industry for a long time, after baptism, the risk awareness of large-scale breeding plants has been significantly enhanced. During the pig price diving that began in May, many large pig farms took measures to eliminate multiparous sows and reduce their stock.
negative factor
The stock of fertile sows is "rigid" and it is difficult to actively decrease: at present, the stock structure of fertile sows is mainly young sows with strong production capacity, so it is difficult for farmers to actively eliminate fertile sows unless they have to, unless there is a long-term deep loss and the capital chain is broken, and finally they have to be eliminated. Therefore, the stock of fertile sows is "rigid" and it is more difficult to actively decline.
With the increase of migrant workers returning home, it is possible for retail investors to return: due to the lack of a large number of labor-intensive enterprises in rural areas in the mainland, the problem of migrant workers returning home for re-employment is more prominent. The investment in pig industry is small, and last year's high pig price made many farmers taste the sweetness. According to the survey, many migrant workers want to return to their old jobs and continue to engage in pig farming. Before the free-range households quit, some markets have been filled with large-scale markets. Now, if retail investors return, the pressure of oversupply of live pigs in the market will increase again.
Farms/households have strong financial strength and strong losses: since 2007, the soaring pig price has significantly enriched the financial strength of farms/households, and once the supply of pigs exceeds demand in 2009, it will enter a state of loss. Market experience tells us that whoever can survive the loss period will recover lost ground and usher in a new round of high profit cycle. Therefore, once a loss occurs, the financial strength will determine who can better "hold on". If everyone has enough financial strength and is waiting for others to quit, the loss period in 2009 may be very long.
The supply of substitutes is sufficient, and the possibility of collective diving is great: pork is not a food with high scarcity and low substitutability in people's daily diet. Due to the growth cycle, the supply of pork, eggs and poultry meat will increase greatly in 2009. The substitution between the two is very likely to lead to a collective collapse in the prices of agricultural products such as meat, poultry and eggs, which will jointly lead to losses.
In 2009, the pig market will usher in a "cold winter": Based on the above analysis, we are not optimistic about the pig market in 2009, but at the same time we are not too pessimistic. The increase in pig slaughter and the sluggish demand may make it difficult for pigs to get out of the downturn before September 2009, because once the supply of pigs exceeds demand, the surplus part must be eliminated, otherwise it will be difficult to turn into a shortage and the market will not be able to get out of the downturn.
However, it is rare in history that the loss period of any cycle lasts for more than one year, because most farms/households will break their capital chain 3-5 months after the loss, and those with poor risk resistance will passively withdraw and start to eliminate sows, so that the supply of live pigs will gradually change from oversupply to short supply within 3-4 months after the elimination of sows, thus getting out of the loss.
Therefore, we expect that after June 5438+00, 2009, with the demand gradually entering the peak season, the market is likely to get out of the loss and a new round of profit cycle will come.
contingency plan
The best opportunity to avoid losses in 2009 has not completely passed. We will strive to slaughter as many sows as possible before the Spring Festival at the end of 2009 1, including sows with poor production performance, and try our best to minimize the stock. Now is the most unsuitable time for fattening pig farmers to supplement commercial piglets, and it is also the time with the greatest market risk.
Before the pig market came out of the downturn in 2009, especially in the late period of losses, a large number of fertile sows were eliminated, which was the best time to replenish sows. Those with sufficient financial strength could take the opportunity to "bargain-hunting". Seize the best opportunity and avoid market risks reasonably at the same time.
You can find professional pig market forecast reports on agricultural websites, such as agricultural blog network and agricultural information network. By the way, Shennong Information Network has a professional pig market information report every week. You can have a look!
And:
After the crazy rise in 2007, the pig market began to dive in May 2008, and the plunge continued until 10. After entering the winter, with the increase of demand, the market has rebounded, but this year's live pig market will not continue this rebound momentum, and it may be a "cold winter" and a new round of cycle will begin.
From the favorable factors, first, the chain reaction triggered by the pig price diving has curbed the growth momentum of sow stocks in time. The plunge in pig prices caused a chain reaction, the profit of breeding decreased, the enthusiasm of commercial piglets to supplement the stalls decreased, the price of piglets decreased, the enthusiasm of sows to supplement the stalls decreased, and the growth rate of sows on hand decreased. At the same time, some farmers eliminated fertile sows with poor production performance, greatly reducing the pressure of oversupply of live pigs this year. Second, the decline in the price of feed raw materials has lowered the cost line of live pigs. Since the second half of 2008, with the price of corn, soybean meal and other feed raw materials falling, the cost line of live pigs has dropped, and the loss of live pigs has also been reduced. Third, macro policies support pig production. Recently, the central government issued 4 trillion yuan to stimulate domestic demand, and at the same time promulgated and implemented a new land policy, which means that more policies and funds will be tilted towards agriculture. As the main body of animal husbandry, pig industry may get greater support at that time. Finally, with the increase of large-scale farms, farmers' risk awareness has been significantly enhanced. After the baptism in 2006-2008, a large number of free-range farmers withdrew from the pig industry, and the proportion of large-scale farming increased. At the same time, the super-high profits since 2007 have greatly increased the financial strength of the surviving pig farms, and more new scale farms have sprung up. The risk awareness of large-scale farms that have been engaged in pig industry for a long time and survived after baptism has been significantly enhanced. During the pig price diving that began in May 2008, many large pig farms took measures to eliminate multiparous sows and reduce their stock, which is an example.
However, the unfavorable factors affecting pig production still exist.
First, the number of fertile sows is "rigid" and it is difficult to actively decline. At present, the stock structure of fertile sows is mainly young sows with strong production capacity, so it is difficult for farmers to actively eliminate fertile sows unless there is a long-term deep loss and the capital chain is broken, and finally they have to be eliminated.
Second, the number of migrant workers returning to their hometowns has increased, and it is more likely that retail investors will return. The world financial crisis has affected many coastal enterprises in China, and there has been a wave of migrant workers returning home in China. Due to the lack of a large number of labor-intensive enterprises in rural areas in the mainland, the re-employment problem of returning migrant workers is more prominent. The investment in pig industry is small, and the high pig price in 2007 made many farmers taste the sweetness. According to the survey, many returning migrant workers hope to return to their old jobs and continue to engage in pig farming. Before the free-range households quit, some markets have been filled with large-scale markets. Now, if retail investors return, the pressure of oversupply of live pigs in the market will increase again.
Third, the demand for pork is shrinking under the background of pessimistic macro-economy. Affected by the world financial crisis, China's GDP growth slowed down, unemployment increased, residents' purchasing power declined, and their consumption willingness was very cautious. As a "non-staple food", the demand for pork will be affected, and there are already signs of shrinking.
Fourth, farms (households) have strong financial strength and strong losses. The soaring pig price since 2007 has obviously enriched the financial strength of farms (households). Market experience tells us that whoever can "bear" the loss period will recover the lost ground and usher in a new round of high profit cycle. Therefore, once the supply of live pigs exceeds demand and losses occur this year, the financial strength will determine who can better "carry" the house. If everyone has enough financial strength and is waiting for others to quit, then this year's loss period may be very long.
Fifth, the supply of substitutes is sufficient, and the possibility of collective diving is great. In the daily diet structure, pork is not a food with high scarcity and low substitutability. Poultry, eggs, beef and mutton, vegetables, fruits and other foods are all competing for the consumer's menu. The high pig price in 2008 not only expanded the scale of pig production, but also led to the increase in the price of poultry meat and eggs and the expansion of production scale. Due to the growth cycle, the supply of pork, eggs and poultry will increase greatly this year. The substitution between these varieties is likely to lead to a collective collapse in the prices of agricultural products such as meat, poultry and eggs.
Based on the above analysis, we are not optimistic about this year's pig market, but at the same time we are not too pessimistic. The increase in slaughter and the sluggish demand may make it difficult for the pig market to get out of the downturn before September this year. However, in history, the loss period rarely exceeds 1 year, because most farms (households) will break the capital chain after 3 to 5 months of loss, and those with poor anti-risk ability will passively withdraw and start to eliminate sows. In this way, within three to four months after the elimination of sows, the supply of live pigs will gradually change from oversupply to short supply, thus getting out of the loss. Therefore, it is expected that after 10 this year, with the demand gradually entering the peak season, the market is likely to get out of losses and a new profit cycle will come.
So, will the new cycle reproduce the super-high profits in 2007? It should be noted that the soaring pig price in 2007 and the resulting super-high profits are rare in history, and the reasons behind it are various. First, a large number of sows were eliminated during the loss period, and the stock of sows decreased sharply; The pig farm that survived the loss period was followed by a high fever, and the stock of sows dropped sharply again; After that, the pressure of macroeconomic inflation increased greatly, the whole price system rose sharply, the prices of agricultural products such as feed raw materials generally rose, and people's purchasing power and demand were strong under the background of inflation ... These factors combined to create ultra-high profits in 2007. At present, the macroeconomic environment is characterized by increasing deflationary pressure and shrinking demand. If there is no major epidemic after this year's loss period, the value law of the live pig market itself can adjust the market to gradually fluctuate to an equilibrium level, rather than getting farther and farther away from the equilibrium level. Therefore, this year's live pig market will tend to converge into a spider web without major emergencies, and the super-high profits in 2007 will be difficult to reproduce.
In the face of this year's loss warning, I think the best time to avoid losses has not completely passed. Farms (households) should try their best to be slaughtered before the Spring Festival, including sows with poor production performance, and try their best to reduce their stocks. Now is the time when the market risk is the greatest, and it is also the most unsuitable time for fattening pig farmers to supplement commercial pigs. Before the pig market goes out of the downturn this year, especially in the late period of loss, it is the best time to replenish sows. Those with sufficient financial strength can take the opportunity to "copy the bottom".
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