Pork-related stocks experienced a collective downturn in Hong Kong trading. As of the latest update, COFCO JOYCOME (01610) dropped 5% to HK$1.33, MUYUAN (02714) fell 3.15% to HK$41.16, and WH GROUP (00288) declined 2.88% to HK$9.78. Recent data from Zhu Yi Tong indicates that as of March 20, the national average trading price for lean-type live hogs fell to 9.89 yuan per kilogram, officially dropping below the 10 yuan threshold and hitting its lowest level in nearly 15 years since May 2018. In contrast to the continuous decline in hog prices, feed costs have been rising steadily throughout the year, driven by increases in soybean meal and corn prices. Soybean meal futures have climbed 11% year-to-date, while corn prices have risen 8% over the past six months. According to Huaxi Securities, demand for pork remains weak due to the traditional off-season for consumption. On the supply side, large-scale farms continue to face pressure to sell off inventory. Against the backdrop of industry-wide losses, heavier hogs are being sold more quickly to reduce fattening losses, further weighing on prices. Profitability data from Tonghuashun iFind shows that during the third week of March, losses for self-breeding and purchased piglet operations deepened to 297.68 yuan and 141.48 yuan per head, respectively. As losses mount across the sector, efforts to reduce hog production capacity are expected to accelerate.
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