BOABC Viewpoint: For serious shortage of hogs, pig prices rose sharply in the Northeast.

Recently, pig prices rose sharply as the supply is in shortage, resulting in continuous growth in national pig prices. At present, the national pig price has exceeded 17yuan/kg, and the profit of raising self-produced pigs is over 570yuan/head. In Liaoning, pig prices have risen to 19.8yuan/kg, and the raising profit of self-produced pigs reaches 850yuan/head. The reasons for the sharp increase in northern pig prices are as follows:
(1) The decline in productivity caused by African swine fever began to be highlighted: the first outbreak of African swine fever was reported in Liaoning, and the government hoped to kill pigs largely in the area hit by the disease to prevent the spread of African swine fever, so the production capacity of commercial pigs and sows in local area dropped sharply. The reduction of sows has led to the current tight supply of pigs, and pig prices rose firstly in Liaoning. According to BOABC’s research, the daily slaughtering volume of three slaughterhouses in the Northeast has fell to 3000heads from about 15,000 heads the same period last year.
(2) Pig farms delay the selling of hogs: at present ,pig prices are rising rapidly in the North. According to our survey, most farmers are confident on future pig prices and they believe that the supply will be sufficient. At present, farmers reluctant to sell pigs and expect higher prices.  
(3) Transportation of pig between the South and the North is banned: for serious disease in the Southwest, Guizhou, Sichuan, Guangxi, and Yunnan issued policies to restrict the outward move of pigs. In addition, the disease in Hunan, Hubei, and Jiangxi is aggravated, so fewer pigs can be transported outwards. Low-price pigs have little impact on pig prices in the North,  and the supply pressure is hard to be eased.
As a result, northern pig prices have risen rapidly as capacity has fallen and fewer pigs can be called in.