Huatai Futures April Swine Market Analysis: Supply Pressure Delayed, Downward Trend in Pork Prices Remains Unchanged

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Source: Huatai Futures

Author: Xue Junyuan

Important News and Data on the Live Pig Market

In futures, as of April 3, 2026, the live pig April 2026 contract closed at 9,380 yuan/ton, down 1,840 yuan/ton from last month, a decline of 16.40%. In spot markets, the external three-yuan live pig price in Henan is 9.19 yuan/kg, down 1.55 yuan/kg from last month, with a spot basis LH05-190, up 290; in Jiangsu, the external three-yuan live pig price is 9.42 yuan/kg, down 1.38 yuan/kg from last month, with a spot basis LH05+40, up 460; in Sichuan, the external three-yuan live pig price is 9.12 yuan/kg, down 1.24 yuan/kg from last month, with a spot basis LH05-260, up 600.

Supply side, sample data shows that in February, the breeding sow inventory was 5.0204 million, a slight decrease of 0.01% month-on-month; in February, the culling of breeding sows was 115.5k, up 1.83% MoM and 18.25% YoY; small and medium sample farms culled 11.2k breeding sows in the month, up 0.74% MoM and 3.66% YoY; in February, the inventory of commercial pigs at large-scale farms was 37.3205 million, an increase of 1.79% MoM and 5.57% YoY. Small and medium sample enterprises had an inventory of 1.5767 million in February, up 1.36% MoM and 11.89% YoY; in March, the average slaughter weight of external three-yuan live pigs nationwide was 123.32 kg, up 0.35 kg from last month, a MoM increase of 0.29%, and a YoY decrease of 0.38%. On the demand side, the slaughterhouse operating rate in March was 30.56%, an increase of 2.54 percentage points from last month and 4.45 percentage points YoY; in terms of inventory, the capacity utilization rate of frozen products in key domestic slaughter enterprises was 21.52% in March, up 4.21 percentage points.

Reference consulting source: Ganglian Data

Market Analysis

In March 2026, the national live pig prices showed a continuous rapid decline, further highlighting the supply-demand imbalance in the industry. The decline was large in the early part of the month, and prices broke through the key support level of 10.0 yuan in the middle of the month without finding effective support. By the end of the month, the pig-to-grain ratio fell into an over-depreciation warning zone. The entire month was marked by a bottom-finding process after a deep fall, with pig prices hitting historic lows for the same period. As of now, the supply exceeds demand, and this surplus situation is expected to continue, with signs of supply pressure shifting backward. In April, pressure remains high, and pig prices still face phased downward pressure. Future focus should be on whether prices can form an effective bottom.

On the supply side, as pig prices continue to fall to historic lows, pig farming has entered a phase of deep losses, which theoretically could trigger active culling of breeding sows. Due to differences in cash flow status among industry participants, the pace of capacity reduction is expected to vary significantly. As of the end of March, the overall market showed only slight capacity culling, not yet entering a phase of rapid losses. In the context of sustained weak pig prices and low enthusiasm for restocking, piglet prices in March also fell below cost, with sales entering a loss zone. During previous profit-loss periods, price support for piglets helped reduce cash flow consumption. Currently, with profits fully in the red, the rate of capacity reduction is expected to accelerate, becoming a key focus in the market. The timing of piglet restocking aligns with the peak season within the year, and in April, piglet prices may stabilize or rebound, depending on whether they rise above cost levels, which could slow capacity reduction.

The overall slaughter pace in March was relatively neutral, with some supply pressure shifting to April. Downstream consumption remains weak, limiting the increase in slaughter volume. Under this constraint, inventory passively accumulates, and slaughter volume continues to rise despite ongoing losses, indicating slow easing of supply pressure.

From the perspective of annual supply rhythm, the expected peak in supply before the festival was concentrated in Q1. Supply pressure is expected to decline month by month in Q2, but the pace of easing is somewhat delayed compared to previous expectations. April’s slaughter plan continues to show MoM growth, with strong expectations for active slaughter, and ongoing monitoring of the progress of capacity reduction by month-end is necessary. The enthusiasm for secondary fattening remains low due to persistently low pig prices and limited short-term profit margins. The market has seen sporadic low-price entries, and overall scale remains difficult to expand further.

Due to sustained low pig prices and limited short-term profit margins, the market has experienced sporadic low-price entries, and overall scale remains difficult to further expand.

It is expected that as supply pressure eases temporarily, the low-price period will further stimulate the expansion of secondary fattening.

On the demand side, slaughtering rates gradually increased throughout the month, with a recovery rate relatively normal compared to previous periods. Overall consumption rebounded to normal levels in the latter part of the month. However, as the market remains in seasonal off-peak, low meat prices have not stimulated large-scale terminal consumption. In late March, as pig prices fell near 9.50 yuan, the enthusiasm for frozen product storage increased slightly, prompting slaughter enterprises to actively increase procurement, but overall scale remains limited. The prolonged period of high supply and low pig prices has prevented effective price bottoming, but as supply pressures ease, the increased slaughter driven by low prices may help stabilize or even trigger a phased rebound.

Strategy

Cautiously Bearish

Risks

Stockpiling, secondary fattening, frozen product storage

Investment consulting business qualification: Securities Permit [2011] 1289

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