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在线翻译:
szdaily -> Business/Markets -> 
Hog futures to start trading
    2021-01-08  08:53    Shenzhen Daily

CHINA will begin trading its hotly anticipated hog futures this week as the industry looks for a safeguard against wild swings triggered by one of the world’s worst animal disease outbreaks.

The contract will debut on the Dalian Commodity Exchange on Friday after about two decades in the planning. The goal is to provide a key hedging tool for hog breeders recovering and expanding production after a deadly African swine fever outbreak destroyed local herds and drove prices to a record.

China accounts for almost half of global pork consumption and production with a market value of about 2 trillion yuan (US$310 billion). Given the importance of the meat in Chinese diet and its implications for national food security, the government has moved aggressively to modernize hog production, improve quality and cut costs. The African swine fever in 2018-19 accelerated the push.

The virus wiped out small backyard pig farms and forced a shift toward large-scale operations, which would be in a better position to trade the contract and manage their risks. The futures contract, which will be the first product in China to allow deliveries of live animals, will help promote standardization of hog breeds to meet the exchange’s delivery rules and specifications.

“The trading volume of the live hog futures is expected to be massive, given the relevance of the product to the broader economy,” said Li Moyu, a Shanghai-based analyst at Orient Futures, a brokerage. Trading will be dominated by the country’s leading producers at the beginning, she said.

Pork prices are a crucial determinant of Chinese consumer inflation, with the two moving almost in lockstep. Last November, the nation posted its first deflation in consumer prices in over a decade as hog prices fell following a rapid recovery in pig numbers. The following month, wholesale pork prices rebounded as demand strengthened ahead of a major holiday season.

Pigs are also of significance to Chinese culture. They symbolize good fortune and happiness, and feature in the Chinese character for “home,” a pictograph of a roof with a pig underneath. Throughout China’s history, the pig has been a prized source of meat eaten on ceremonial or sacrificial occasions. (SD-Agencies)

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