Is the pig price drop also related to information being too timely? A must-read for pig farmers
After rising for a few days in Northeast China, prices have once again entered a downward channel. Unlike usual, this time they rose fast and fell fast. Across the whole country, this is a torment for pig farmers. In such a volatile market, selling one day earlier or one day later means a loss of hundreds of yuan. Where lies the mystery of pig price trends? How should future trends be assessed?
1. Pig supply has not yet been fully released: Everyone knows that the price drop during the Dragon Boat Festival was caused by large-scale holding back of pigs before the festival and even in May. Entering summer, there were too many oversized pigs, and they were released in a concentrated way after the Dragon Boat Festival. As of today, what I want to say is that the release is still not complete. Why did prices fall again? It shows that there are still quite a lot of pigs. This is an indisputable fact. While pig prices were falling across the country, I once said I firmly believed pig prices would rise back. That was based more on consideration of pig supply. Current fluctuations will gradually stabilize rather than continue to fall.
2. Nationwide follow-the-trend behavior is quite intense: The more developed information is, the less independent judgment people may have. If Northeast China rises, or Shandong falls, you think the South will also rise, so you start holding back pigs. If Northeast China falls, you anxiously rush to sell too. This is the current phenomenon in the pig farming industry. Because everyone can see pig prices on WeChat, information is too developed, which is very unfavorable for the entire market. Slaughterhouses are also very smart and good at using online public opinion to push prices down, and some farmers also spread public opinion. Therefore, pig price rises and falls are like a nationwide wind, instantly sweeping across both North and South.
3. Slaughterhouses are engaged in deep game-playing: Right now, times are indeed not easy for slaughterhouses, or rather quite difficult. On the one hand, the consumer market is increasingly bleak, and order volumes are unstable. On the other hand, summer pig supply is unstable, and purchase prices fluctuate greatly. So slaughterhouses all have the same idea: only if they can pull prices down can they gain higher profits. But there are few pigs, so pushing prices down is difficult, and many purchasing managers are also struggling.
Regarding the future market, several views:
1. Supply is still short, but there is not much room for increase: Overall room for increase this summer is not large. The reason is simple: the pig market is in overall supply shortage, and this will continue. But overall room for increase is not large, and it is basically in a state of high-level fluctuation. The impact of held-back pigs on the market always exists. Next, amid wave after wave of fluctuations, more and more farmers will choose to sell as trends dictate. For slaughterhouses, purchasing pressure may not be as great as in previous years
2. Consumption is unstable, and fluctuations may be relatively large this summer. Entering summer, consumption fluctuations will also be large. If pork dealers do not sell out on a given day, procurement the next day will decrease, and the same applies to slaughterhouses. Purchase volumes will fluctuate greatly. Once they do not need pigs that day, they will push prices down; once there is a shortage, they will take the initiative to raise prices. Therefore, next, pig prices may continue fluctuating within a range of three to five mao, unable to rise and unable to fall.
3. Sell if big enough, do not follow trends. Second Senior Brother's advice is to sell if too big. At this time, trusting anyone is worse than trusting yourself. Three days up, three days down, no one's forecast can closely match the market, so I firmly believe your own pigs are up to you, and sell if big enough. There is also no need to deliberately dump pigs. These days, you still need to maintain the slaughter weight that maximizes profits. I once said that if you avoid the peak selling period, you have made the right bet. The same principle applies this time. The few days when everyone is not selling are often the days with better prices. Who can truly understand this sentence?
4. Act according to circumstances, your pigs are up to you. When prices fall sharply, do not dump. If they cannot fall further, and when prices rise sharply, do not hold back. Sell when it is time to sell, and sell rationally.
What do you think are the reasons for the pig price drop? (Multiple choice) 0 people 0% Follow-the-trend behavior too intense 0 people 0% Slaughterhouses pushing prices down 0 people 0% Unstable consumption, large summer fluctuations