(Bloomberg) -- China’s pig prices are expected to fall in the second half of the year amid ample supplies and sluggish demand, according to the world’s top pork producer.
That would flip the direction of the market, which has seen a 40% jump in prices since early May. The reversal would alarm not only local farmers but soybean and corn growers in the US and Brazil, whose produce feeds China’s huge herd.
WH Group Ltd. said Tuesday it will curtail pig farming but continue to invest in and develop its packaged-meat business. The Hong Kong-listed company also reported an 87% increase in first-half profit.
Hog prices have been buoyed by herd reductions and by farmers keeping more pigs rather than sending them to slaughter. Such practice will shrink significantly later this year, pressuring prices, according to Ma Xiangjie, executive director and president of WH Group-owned Shuanghui Development.
Meanwhile, demand for meat has weakened as lackluster economic growth in the world’s No. 2 economy cuts consumers’ purchasing power.
WH Group reported first-half net income of $784 million, up from $420 million a year earlier.
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