Dim Sums: Agricultural Markets in China

Chinese hog prices have now fallen to their level of two years ago. After about 14 months at stubbornly high levels, pork prices are down more than half from their year-ago level, and officials are scrambling to mop up excess supplies. Officials worry that losses will lead to more gyrations in supply. Average wholesale prices reported by China Ministry of Agriculture and Rural Affairs. The swine inventory at the end of Q2 2021 was at its highest level in the last five years, according to data released by China's National Bureau of Statistics.  Calculated from China National Bureau of Statistics reports. The increase in the swine inventory during Q2 is remarkable given that the statistics bureau also reported a surge in hog slaughter during Q2--usually the off-season for hog slaughter in China. The surge of slaughter is consistent with monthly slaughter data reported by the Ministry of Agriculture and Rural Affairs which indicated 22 million head were slaughtered at "above-scal...

Epic flooding, drought, hungry caterpillars, and stubborn African swine fever have Chinese officials scrambling to shore up the fall grain harvest--just two months away. Torrential rains and catastrophic floods in Henan Province this week are the latest and most-publicized of a series of mid-summer extreme weather events that have affected most of China's major agricultural regions in 2021.  On July 21, Xi Jinping issued "important directives" to prevent casualties and property damage from the serious flooding in Henan. Noting that rivers are above their normal levels, dams are vulnerable, some trains have been stopped and flights have been canceled, the flood control situation was pronounced to be very severe. Soldiers were ordered to help with rescue and aid, and authorities were instructed to provide ample warning of heavy rain, typhoons, mountain torrents, and mudslides.  Flooding in Jiangxi Province. In June, Yicai reported that there was widespread flooding in In...

The latest data indicate China's demand for animal feed has kicked it up a notch this year.  With tight corn supplies, Chinese authorities are loosening the longstanding quota stranglehold on corn imports by allowing imports in "bonded zones" and turning to the international market to restock reserves.  May 2021 data from China's feed industry association suggest that the country's feed production has vaulted to a new level. China's feed production in the first five months of 2021 totaled 114 million metric tons, 21.5 percent ahead of last year. Monthly feed output is running 4-to-5 mmt ahead of same-month totals from each of the previous three years. Source: analysis of China feed industry association data.  The association says January-May 2021 swine feed production is up 75 percent from the same period last year. Jan-May swine feed output is also 10 mmt higher than the same period in 2018--before the African swine fever epidemic began. Poultry feed product...