In recent years, when it comes to pork, I think everyone thinks it's cheap. Due to the persistence of pork, many pig enterprises are struggling to survive. In the face of continuous losses, many pig companies have lifted the ban, when will the price of pigs rise?
1. The "Big Three" of pigs are expected to lose more than 14 billion?
According to the ** report, the domestic pig production capacity remains high, and the industry generally believes that the pig breeding industry has experienced "the longest consecutive decline in history". Relevant data show that last year, the national average spot price of live pigs was 1500 yuan kg, a decrease of 1927% from 2022.
The continuous decline in pigs has caused great losses to pig breeding enterprises. According to the 2023 live pig sales results recently announced by listed companies, industry leaders Muyuan shares, Wen's shares and New Hope shares*** have all suffered significant losses. After deducting non-recurring gains and losses, the three companies are expected to lose more than 14 billion yuan. In the same period, in 2022, Muyuan shares and Wen's shares earned nearly 15 billion yuan and realized a profit of nearly 14 billion yuan. 5 billion yuan, and New Hope lost nearly 1 billion yuan.
So far, domestic pigs have been three consecutive years. In the process of this round of pig production, the overcapacity of the pig industry has been gradually resolved, and the record of pig prices has been continuously refreshed.
The total loss of listed pig companies in the pig breeding business is consistent with last year's **. "According to the monitoring data of the Ministry of Land and Rural Affairs, in 2023, the processing plants (households) will only make profits in August and September, and there will be losses in other months. According to the weighted average calculation, the average loss of each processing plant (household) in 2023 is 76 yuan for the processing plant (household) to sell commercial pigs, which is the first book loss since 2014. In 2014, although pig breeding also suffered losses, there were 9 months of losses, of which 12 months were losses. One year, but by 2023 it will reach 10, 10% more than in 2014. Losses last longer.
2. When will the hogs **?
In recent years, China's pig farming industry has experienced severe market fluctuations. Especially in 2023, affected by a variety of factors, the three major domestic pig farmers are expected to lose more than 14 billion yuan per year. What should we make of such a huge loss?
First of all, China's pig breeding industry has seen a large-scale investment boom in recent years, driven by policy incentives and market expectations. New investments such as new facilities and expanded processing operations are evident, which has led to the transition of the current hog market to a stage of concentrated capacity. Enterprises that originally planned to expand production to meet market demand and improve industrial efficiency are now facing the problem of a significant increase in the market and limited progress in reducing production capacity. Due to the long pig production cycle, it usually takes more than a year from sow breeding to commercial pig slaughter, so when a large number of new production capacity enters the market, it is difficult to adapt quickly in the short term, resulting in overcapacity of pigs. The total market volume is relatively sufficient.
Secondly, with the development of China's economy and the improvement of residents' living standards, as well as the increasingly popular concept of health, the growth rate of domestic pork consumption has slowed down significantly and tends to reach the ceiling. Consumers are paying more attention to balanced diets and diversified nutrition, and meat choices are more diversified, and the consumption of substitutes such as beef, mutton, poultry, and aquatic products in addition to pork is increasing year by year. This structural change has weakened the support on the demand side of pork, so even during the peak seasonal consumption period, the hog *** amplitude has weakened.
Third, there is another factor that cannot be ignored in the pig industry - the storage of frozen products. In the past high period of pig production, many companies decided to freeze and store some pork products in order to make a profit or cope with possible fluctuations in the future. However, due to overcapacity, the inventory of frozen products did not thaw in time, but continued to accumulate, further reducing the demand for fresh pork. In the case that the market is trying to pull up the pig market by consuming excess capacity, the high inventory of frozen products has become an important obstacle for the pig industry, which not only hinders the speed of the market's recovery, but also compresses the space.
Fourth, in the long run, the market concentration of China's pig breeding industry has gradually increased, and the scale effect of leading enterprises has become more and more obvious, which also means that market competition has intensified. When the pork ** is low, large pig enterprises such as Muyuan shares and Wen's shares have taken action. New Hope shares are not only facing the pressure of short-term huge losses, but also must continuously improve their cost control capabilities to adapt to the fierce market competition. Only those pig breeding enterprises that can effectively reduce costs, optimize management processes, and achieve efficient production are likely to survive in a low-price environment for a long time, and ultimately affect the structure and long-term development trend of the entire industry. Pig**.
For a period of time in the future, the pig will maintain a low operation. In this process, only those processing enterprises with strong cost management capabilities and technological innovation capabilities can survive and develop in market competition. Pork Sannong