All pig farmers, the wait is finally here! After nearly half a year of low pig prices, the Ministry of Agriculture and Rural Affairs announced that pig farming is expected to turn a profit by the end of June! Judging from the current market situation, this means that pig prices need to usher in a sharp rise; but more importantly, the Ministry of Agriculture and Rural Affairs has made it clear that the next key task is to "stabilize expectations", which is important to protect the operating interests of farmers. direction!

According to the China Youth Daily report on April 20, Zeng Yande, chief agronomist and director of the Development Planning Department of the Ministry of Agriculture and Rural Affairs, said that day that it is currently the off-season for pork consumption. As some farmers were reluctant to sell in the early stage, Pork production is still increasing, pig prices continue to remain low, and some farmers are experiencing periodic losses. He said that based on comprehensive judgment, pig farming is expected to turn a profit by the end of the second quarter.

The announcement of this news undoubtedly gives a torch of hope to the majority of livestock farmers! After all, pig prices have been sluggish for half a year, and the confidence of farmers has been hit hard.

If pig breeding needs to turn a profit, judging from the current pig price of 14 yuan/kg, it will need to increase by at least 3 to 4 yuan/kg! This is very difficult under the saturated pig production capacity, and the profit margin will not be very high. Therefore, farmer friends must not aggressively press pens and secondary fattening, as the risks may outweigh the benefits! It is safest to maintain a normal business rhythm.

But compared to the news about the expected rise in pig prices, what is more important is that the Ministry of Agriculture and Rural Affairs has revealed that the next key work must be to achieve "two stability and one reduction", which is closely related to farmers.

Specifically, "two stabilizations and one reduction" are to "stabilize market expectations, stabilize pig production capacity, and reduce breeding risks."

As we all know, "stabilizing pig production capacity and reducing breeding risks" is a commonplace statement. Since the African Fever, the Ministry of Agriculture and Rural Affairs has been focusing on promoting these two major tasks, and has achieved excellent results. Therefore, the real latest focus is to "stabilize market expectations"!

The Ministry of Agriculture and Rural Affairs stabilizes expectations

What is "stabilizing expectations"? What work will the Ministry of Agriculture and Rural Affairs carry out accordingly? What does it mean for farmers?

Zeng Yande said that "stability" means stabilizing expectations, issuing early warning information in a timely manner, and guiding farmers to reasonably arrange the production rhythm, so as to avoid blindly pressing the stalls and secondary fattening when prices are low, which will hinder the recovery of pig prices and increase pig prices. Long loss period.

The key point is that an important reason for the current violent fluctuations and continued downturn in pig prices is that the breeding industry frequently makes mistakes in judging the market outlook, and the resulting stalling and secondary fattening have hindered the recovery of pig prices. . The Ministry of Agriculture and Rural Affairs hopes that through more frequent market warnings, everyone can produce more rationally, thereby reducing breeding risks and protecting breeding rights.

There is no doubt that this is of great value to farmers, but based on the current industry operating status, it is very difficult to achieve a good "expectation stabilization" effect, because it means that pig production must be enhanced. "Planned Economy" attributes, and this still has to overcome several difficulties.

First of all, there is still huge uncertainty in the pig cycle, but the planned economy requires huge certainty, so the plan may not achieve its original purpose. For example, when pig prices fell from 2021 to 2022, authoritative channels once stated that the pig cycle is "every four years", and pig prices are expected to rebound significantly in 2023, but obviously this has not come true. The main reason is that there are too many factors that affect the changes in pig prices, and it is difficult to plan production and regulate all employees.

In fact, the Ministry of Agriculture and Rural Affairs has the most comprehensive data on fertile sows and newborn piglets in the country, so it can make the most accurate judgment on the fundamentals of pig supply. But the problem is that most people believe that they are smarter than others and always think that they have far better experience in the pig cycle than others, even if the other party is a department that has mastered national production capacity data.

The more difficult point is that the frequency of "stabilizing expectations" of the Ministry of Agriculture and Rural Affairs must be fast enough. It cannot just announce an upcoming increase in pig prices when farmers are discouraged because of losses, because this cannot be reversed. The fact that everyone has been losing money for several months in a row really plays a huge role in the follow-up "stabilizing expectations" work. It should be a strong call for everyone to reduce production a few months before losses are about to occur, or it may indicate that cyclical risks are coming.

However, in fact, the official departments also have "unspeakable secrets" about this, because they also have the important task of "stabilizing production capacity" - in a sense, "stabilizing production capacity" is more important than "stabilizing production capacity" "Expected", because this is a major livelihood plan, related to the supply of meat, eggs and milk for 1.4 billion people. For example, we have seen that before pig prices fell in the past, relevant departments sometimes gave some signals, but they were not very strong. Most people still only believed in themselves and continued to expand production (refer to the market situation at the end of last year).

Since there are many difficulties in "stabilizing expectations", why should we focus on it? What is the value behind it?

The value of "stabilizing expectations"

In the short term, "stabilizing expectations" can at least help some farmers "avoid lightning in advance", although many people cannot hear or believe it , but there are always some farmers who will make the right judgment.

In the long term, stabilizing expectations requires the cooperation of the entire industry!

Because if the work of "stabilizing expectations" is vigorously promoted and every time the pig price trend reverses, it is vigorously publicized and sent to most farmers, then a large number of farms will increase or reduce production together, and it will really be possible. Ironing pig cycle? This is not realistic. The analysis is divided into two situations -

First, the official said that the price is about to rise, and the farmers will be very motivated to increase the volume and hold down the fence in the short term. After all, who is making money? They are all afraid of falling behind others. The result is likely to be an excessive increase in production, and the price of pigs will fall below expectations or even plummet prematurely.

Second, the official said that the price is about to fall. Some people will panic and sell pigs, causing the price of pigs to collapse. However, a larger number of people who were originally in a wait-and-see state will be afraid, and the short-term slaughter volume will further increase. As a result, The price of pigs has fluctuated greatly, making it impossible to stabilize.

In summary, it can be seen that "stabilizing expectations" does have a lot of difficulty. To smooth out the pig cycle, more efforts and knowledge from the entire industry will be needed. However, one thing is precisely because Difficulty has its important value. Just like when China, which was very poor and had nothing to do, wanted to develop its "aerospace industry" and build "two bombs and one satellite", it was extremely difficult, but the value was even more extraordinary!

Nowadays, the Ministry of Agriculture and Rural Affairs has begun to emphasize and attach importance to the work of "stabilizing expectations", which is the most positive signal. It also proves that although the pig industry is a people's livelihood industry, the country will never ignore the majority of farm households. rights and interests. Today's continued slump in pig prices actually reflects two major shortcomings in the industry - wild growth in pig production capacity and crazy betting on the market.

Then, "stabilizing expectations" can at least cool down the overheated industry, first curb the momentum of wild growth in production capacity, and at the same time help some people return to reason. But again, there is a long road ahead. Now that the higher authorities have paid more attention to the rights and interests of the majority of livestock farmers, they hope to focus and speed up efforts to help the industry return to a sustainable and profitable operating state.