Vaccinating a pig at a farm in Shandong. (Photo/Xinhua)
The recent incident in which thousands of dead pigs were found floating in Shanghai's main river has further hit pork prices in China, with the sector already experiencing falling demand, according to local media reports.
Weekly data from the country's Ministry of Commerce released on March 20 showed that wholesale prices of pork has fallen for four consecutive weeks as of March 17, with the accumulated decline over the period touching 8%.
Pork prices in the country were undergoing a seasonal decline after Chinese New Year, but the recent scandal has rotted demand, Chinese business news site Caixin said.
Even United States Treasury secretary Jacob Lew ordered vegetarian dumplings instead of dumplings stuffed with pork when he dined out during his recent visit to China.
The Chinese government's guidelines on official conduct, including the restrictions imposed on holding official banquets, is another factor affecting pork demand, driving down prices to levels resembling a crash, Caixin said.
Figures posted by industry information website Soozhu showed that average hog prices dropped to 12.5 yuan (US$2) a kilogram on March 19, and the pace of its decline touched a near-decade high.
The National Development and Reform Commission, China's economic planner, said it is closely monitoring pork prices and would intervene if the market downturn persists.
E-commerce giant Alibaba's website covering the agricultural sector said pork has seen three market cycles during the past decade, with each cycle becoming shorter and price fluctuations becoming steeper.
Pig farmers began expanding capacity two years ago when pork prices surged, leading to the current situation of excess supply, local reports said.
In Jiaxing in Zhejiang province, one of the major bases of pig farming in the Yangtze River Delta, annual output now stand at 4.5 million hogs, which indicates the saturation in the sector, a local farmer said.
Low temperatures since the end of last year have increased the incidence of disease, while some farmers fail to tend to their pigs carefully because of the low prices, the farmer said as a reason for pigs' high mortality rates this year.
An expert said the farmers' rush to raise hogs and chase profits is the main reason behind the volatility in livestock numbers.
Hu Huaibang is commissioner of disciplinary inspection at the China Banking Regulatory Commission. He was educated at Jilin University and in 1999 received his doctorate from the Shaanxi Institute of ...