the contracts futures of live hogs in China closed down 4.7% on Wednesday, the biggest one-day low since the contract was launched, after the Chinese state planner said he would strengthen price supervision.
Pig prices in the world's biggest meat producer have surged in the past two months as a reduction in the breeding herd that began last year took a toll on production.
farmers with an eye on rising prices, they are also avoiding slaughtering pigs, raising them to reach higher weights, further reducing supply.
A 50% increase in spot prices since early May has led to a spike in hog futures prices.
On Monday, the September contract posted its biggest daily gain since its launch.
The market trend reversed sharply on Wednesday as futures fell to 21,220 yuan ($3,163.95) a tonne after the National Development and Reform Commission declared it would increase price surveillance.
The NDRC also met with major hog producers this week to ask for a steady slaughter volume to lower prices.
“If listed companies start selling, there won't be this shortage and prices won't move,” said Yuan Song, chief analyst at Juxing Agriculture Group.
A rapid rise in pork prices could cause a rise in the price of China's favorite meat, a concern for Beijing, which faces slowing economic growth and weak consumption due to its zero Covid policy.
Sources: investing.com
