China’s hog prices have still not found a bottom, reaching $0.82 per pound during the second week of April. This is the lowest since July 2010, down 12 percent from a year ago and down 28 percent since the beginning of 2014. To put this is in context, China’s hog prices were 13 percent lower than U.S. prices last week. During the corresponding week last year, China’s prices were 54 percent higher than U.S. hog prices. China’s piglet prices have fallen 13 percent since January and are also down about 13 percent year-over-year.
China’s hog:corn price ratio was above the 6:1 profitability indicator from July through mid-January, but has been below this level for the past three months. Now at 4.77, the ratio is down from 5.2 during the same week last year and is now at its lowest level since 2010. The decline in hog prices has more than offset the minor 4 percent drop in China’s corn prices – which are about double U.S. prices at $9.60 per bushel, despite China’s record crop.
China has announced government procurements of pork to help stabilize prices, but the volumes are small and any impact on the market will be psychological. China’s wholesale prices for imported pork variety meat were relatively strong in early April despite the sluggish market for domestic pork, with front feet prices up 7 percent year-over-year and hind feet up 13 percent. Prices for tongues, stomachs, and ears have eased since February but were still higher year-over-year – especially for stomachs (+14 percent).