China's swine and poultry industries are shedding capacity as cash resources get tight and peak season for disease hits.
After 13 months of decline, productive sow numbers in November 2014 were reported by China's Ministry of Agriculture to be 43.68 million, down 13 percent from their peak.
The current hog price is reported to be 13.07 yuan/kg. The price is depressed despite the approach of the spring festival, China's customary peak-demand period. After the extended period of losses, cash has been getting tight for farmers, so they have been culling sows.
Disease is contributing to the drop in animal inventories. In December, China Central TV reported that a large outbreak of foot and mouth disease occurred in Jiangxi Province. It was also reported that pork from the diseased pigs was sold in at least seven provinces. The Ministry of Agriculture announced that a district of Ma'anshan in Anhui Province had the first detected type-A foot and mouth disease. FMD outbreaks have been reported in Hubei, Hunan, Tianjin, and Liaoning. Chinese analysts think these reports may be "the tip of the iceberg"; they think disease problems may be spiking due to winter weather and cash-poor farmers skimping on disease control.
In Xiamen, two confirmed human cases of H7N9 caused sales of poultry to plummet at the city's wholesale and retail markets. Local authorities closed the markets on January 2-3 to disinfect them, and sales were one-tenth of usual after the markets reopened. This follows major outbreaks of avian influenza during 2013 and 2014.
Broiler and duck breeding flocks are down 20%-30%.
Over the past 5 years, China's hog cycle was compressed from the traditional 3-4 years to 1-2 years. Analysts say the current downturn, already extending 1-2 years could drag on quite a while longer. They note that severe declines in production capacity led to price spikes in 2011 and 2007.
Another article--perhaps trying to divert attention from severe problems in the domestic pork industry--warns consumers that imported pork could be laced with "lean meat powder" and salmonella. China's inspection and quarantine authorities have been carefully testing imported pork for ractopamine, and said they detected it in 17 batches of imported U.S. pork during November 2014. The ractopamine was found in pig feet, snouts, kidneys, tongue and other offal. All of the detections were at the Tianjin port. The Xiamen port also found salmonella in pork imported from Spain.
The article warns readers, "Don't think imported pork is so good-tasting; it could contain "lean meat powder!"