BEIJING China's most active live hog futures contract fell by more than 3 per cent on Wednesday, the biggest decline since July, as spot prices came under pressure from weak consumption and heavy slaughter volumes.
The January contract was down 3.05 per cent to 20,315 yuan $2,908. According to Shanghai JC Intelligence JCI Co Ltd, 71 per tonne was 71 per day by 10: 15 a.m. 0215 GMT Average national hog prices were 22.43 yuan per kilogram on Tuesday, and have declined 8 per cent so far this month.
Yuan Song, chief analyst at Juxing Agriculture Group said the market had expected a drop in temperature this month to boost meat consumption and support pig prices.
He said that the consumption growth is not strong and the supply is more abundant due to the increase in slaughter.
After prices rallied in the third quarter, Beijing had urged major hog producers to step up slaughter volumes.
The top Chinese hog producer Muyuan Foods Co Ltd said it was expected to slaughter between 61 million and 62 million hogs this year, well above the 56 million it had previously targeted.
The market has no good expectations for an increase in pig prices before the Spring Festival, said Yuan, who referred to the Lunar New Year holiday next month as the country's peak pork consumption period.