Feed costs fell sharply in the fourth quarter, the aquaculture industry ushered in a warm winter

Global corn and soybeans have achieved bumper yields this year, and global agricultural prices have continued to fall. In the case of a sharp drop in feed costs and a substantial improvement in meat supply and demand, the aquaculture industry may usher in a "warm winter" in the fourth quarter.

Feed costs fell sharply in the fourth quarter, the aquaculture industry ushered in a warm winter

November has come to an end, but compared with the colder weather, the aquaculture industry is quietly warming up. During the double festival of Mid-Autumn Festival and National Day this year, the demand for aquaculture products showed the characteristics of "sluggish peak season". The market was once more pessimistic about the prospects of the aquaculture industry in the fourth quarter, but in the case of a sharp drop in feed costs and a substantial improvement in meat supply and demand, the aquaculture industry may usher in a "warm winter" in the fourth quarter.

Feed costs have fallen sharply

Global corn and soybeans have achieved bumper yields this year, and global agricultural prices have continued to fall. Us bean futures have been hovering around 1000 cents per bushel recently, a nearly five-year low. Although agricultural products rebounded briefly in November because of US transport problems, the pattern of oversupply has not changed, and global agricultural prices are expected to remain low in the coming months.

October is the harvest season for American soybeans, and a large number of low-cost new crops will be transported to China in the next few months, which will have an impact on domestic feed production costs. Soybean meal and other feed prices have some room to fall.

As of November 21, the price of soybean meal in the domestic spot market is generally more than 3400 yuan / ton, and even more than 4000 yuan / ton in some areas, while the price of the main contract in the futures market is less than 3000 yuan / ton. this reflects that market investors are generally pessimistic about the price of soybean meal in the future, and with the passage of time, the current price gap in the future will gradually narrow.

In addition to soybean meal, the price of corn, another major feed, also remains low. Due to the sufficient market supply and insufficient terminal demand, the trend of corn price is weak. Domestic spot corn prices have fallen by more than 10% since September.

According to the forecast of China Grain Network, the country's total corn output in 2014 is about 424.6 billion jin, a slight decrease of 2.75% over the previous year, but due to large stocks and imports, the supply and demand situation is not optimistic. Especially after this year's autumn harvest, farmers generally adopt the method of emergency sales in order to deal with it conveniently, and the listing of a large number of new corn has depressed the price. The fall in corn prices will also lead to a significant reduction in feed costs, which may be reflected in feed sales prices over the next two months.

The stock of live pigs decreased significantly.

The pig market was relatively volatile in the first three quarters, especially in September and October, pork prices were not as strong as the market expected, but prices fell for 10 consecutive weeks since September 3, which dealt a big blow to the confidence of market farmers.

Weekly data released by the Ministry of Agriculture show that as of November 12, the national pork market price was 23.19 yuan / kg, although continuing the previous decline, but only 0.01 yuan / kg lower than the previous week, the price has a stabilizing trend. After entering the last ten days, pork prices in various regions began to stabilize and there were different ranges of price increases.

The reporter learned that the main reason for the decline in pork prices lies in the decline in the number of stocks. The average price of piglets across the country fell 15% in August compared with the same period last year, which means that the profits of the aquaculture industry are poor, and the willingness of breeding enterprises to make up the fence is relatively low.

There was a breeding epidemic in the north in early September, which made it even worse for the farming industry, directly leading to a wave of large-scale selling, with many live pigs being concentrated in advance in September and October, leading to depressed prices. The data show that the average weight of pigs in October was 1.57 kg less than that of the same period last year. At the same time, the total stock of live pigs continued to decline in October, and the proportion of small and medium-sized pigs decreased by 0.5% compared with September, reflecting the continued downturn of piglets in October.

In addition to the data of piglets, the stock of fertile sows has also declined significantly. The stock of fertile sows has fallen 12% from its all-time high in September, according to the Ministry of Agriculture. The elimination of sows increased by 20% month-on-month in October, which means that the stock of fertile sows will continue to decline in October.

According to the general law of pig breeding, piglets need a fattening period of 4 months, and it also takes time for the number of sows to recover, so it can be inferred that the supply of pigs will not be particularly abundant at the end of the year, and the surplus supply of pigs has been greatly improved.

Looking forward to the stock market at the end of the year

The the Beginning of Winter solar term of the Chinese lunar calendar on November 7 has passed, the temperature across the country has dropped significantly, and the market demand for meat will gradually increase. Unlike in previous years, outbreaks such as bird flu are not serious this year. There were only small outbreaks in September. Two months later, consumers gradually forgot about them.

Last week, pork consumption in local markets began to increase, and pork prices have risen somewhat, with increases ranging from 2% to 3%. In mid-to-late November, the stock market at the end of the year has begun. At present, various parts of the south have entered the season of pickled bacon, at the same time, local slaughtering enterprises will also begin to prepare goods for the end of the year, pork demand is expected to continue to rise, the stock market at the end of the year is worth looking forward to.

The decline in pork at the end of last year is difficult to repeat this year because at the beginning of the national food and beverage economy last year, the market reacted slowly, with supply far exceeding demand, leading to a drop in pork prices during the first Spring Festival. After nearly a year of capacity loss, the supply situation has reached a reasonable balance this year, although the market is still controversial about how much the price can rise, but market participants generally expect the aquaculture industry to have a "warm" winter this year.

What people in the industry, including farmers, are most concerned about is whether the aquaculture industry will rebound in retaliation after profits recover this year.

The concentration of China's aquaculture industry is gradually increasing, small aquaculture enterprises with poor ability to resist market price risk have closed down, while large aquaculture groups are on the rise. The growth rate of production capacity can not be underestimated. Cofco, Huaxi Hope, Wen's, Young Eagle, Zhengbang, Zhengda and other major breeding groups have invested in the construction of pig breeding bases on a large scale in Jilin. It is estimated that after all these projects are completed, the pig production capacity of Jilin will double to 30 million. However, after the profits of the breeding industry improve at the end of the year, the construction of these projects will be greatly accelerated, and the profits of the pig breeding industry next year should not be overly optimistic.