Nghe An: Pig prices have decreased, why are meat prices still high?

Although the price of live pigs has shown signs of "cooling down", the price of finished pork products is still "stuck" at a high level, fluctuating between 130,000 - 160,000 VND/kg in traditional markets. The price of meat in supermarkets and food stores is at 180,000 - 200,000 VND/kg. Photo: Thanh Phuc

One week after the Ministry of Agriculture and Rural Development requested livestock companies and enterprises to lower the price of live pigs to stabilize the market, the price of live pigs in localities has shown signs of "cooling down". Specifically, from the price of 75,000 VND/kg - 85,000 VND/kg, it has now decreased to 68,000 VND/kg - 80,000 VND/kg.

Mr. Nguyen Van Hoang, owner of a large-scale pig farm in Nghi Van (Nghi Loc) said: “Since after Tet until now, the price of live pigs has dropped sharply. In recent days, the farm has sold pigs at a price of 75,000 - 78,000 VND. This price, in my opinion, is not too high because the cost of raising pigs in the current period when implementing biosafety measures and the cost of re-herding is quite high.”

The price of live pigs in rural areas sold by small-scale farmers is lower, at 68,000 VND - 73,000 VND/kg. However, after Tet, the amount of live pigs in the population is not much.

“The Prime Minister and Deputy Prime Minister have both directed that pork prices must be reduced to normal levels as before the outbreak. However, up to now, pork prices have remained too high. Therefore, next week, the Ministry will call on and request large enterprises to reduce prices together, bringing the price down to at least 75,000 VND/kg. If pork prices are still deliberately "anchored" at a high level, the Ministry and related ministries and branches will review and inspect, based on laws and regulations in disease prevention work to have sufficient legal basis to require enterprises to reduce pork prices to a reasonable level."

Minister of Agriculture and Rural Development Nguyen Xuan Cuong

Although the price of live pigs has “cooled down” compared to before, the price of finished meat sold in markets is still “stuck” at a high level, ranging from 130,000 VND - 160,000 VND/kg; in supermarkets and clean food stores, it is from 180,000 VND - 200,000 VND/kg. Mr. Ho Van The - Head of Sales Department of a clean food enterprise in Vinh city said: “For nearly a month now, the price of pork that the store imports is still at 120,000 VND/kg, so the price of meat sold remains the same, it is not possible to adjust the selling price down”.

The price of live pigs has "cooled down" and most recently, the domestic price of live pigs on February 20 has dropped to 65,000 - 70,000 VND/kg in some places. Currently, according to forecasts, when African swine fever is well controlled, herd restoration is being accelerated, so the supply of pigs is not scarce. So why is the price of meat to consumers still high?

According to a representative of a large-scale pig farm owner, who sells hundreds of pigs every day, "We mainly sell to traders and slaughterhouses, while distribution through stores and supermarkets only accounts for a small proportion. Therefore, when going through intermediaries, meat prices are pushed up. Therefore, it is necessary to control the intermediaries well. To stabilize the market, it is not enough to just ask farmers to reduce the price of live pigs, but it is necessary to manage the price of meat sold on the market."

In the near future, when African swine fever is under control and herd restoration is accelerated, pig prices are forecasted to return to 55,000 VND - 60,000 VND/kg. Photo: Thanh Phuc

According to the explanation of pork retailers in traditional markets: "If the price of live pigs drops to 75,000 VND - 78,000 VND/kg, then the price of pork will only be 93,000 VND - 98,000 VND/kg. However, in reality, we still buy wholesale from slaughterhouses at 115,000 VND - 120,000 VND/kg. That is too high, equivalent to the previous price of live pigs at 85,000 VND - 90,000 VND/kg."

According to many traders, the reason why slaughterhouses "anchor" pork prices high is to "stretch capital" for a long period of losses when pork prices peak. Therefore, after a while, when pork prices continue to fall, slaughterhouses will reduce prices but in a "trickle-down" manner.

Discussing this issue with Ms. Nguyen Thi Nhi, owner of a slaughterhouse in Vinh market, Ms. Nhi said: "In recent days, the price of live pigs has decreased slightly. Currently, the price of pigs we import from farms is 78,000 VND/kg. However, the price of hogs is still at 120,000 VND/kg imported to small traders.

According to Ms. Nhi, with the import price of 78,000 VND/kg of live pigs, in reality, to "compensate for the price", farm owners feed the pigs before weighing them, so the actual price of pigs still fluctuates around 80,000 VND/kg. In addition, the operating costs of the slaughterhouse (premises, labor, electricity, water, taxes), and the amount of meat consumed have decreased sharply, so to make a profit, the selling price of finished meat at 120,000 VND/kg is reasonable. The slaughterhouse will base on the situation of live pig prices to make appropriate adjustments.

Meat prices are high but consumption is slow, even stagnant. Photo: Thanh Phuc

On the consumer side, when hearing the news that pork prices have decreased, but in reality, they still have to buy meat at high prices, they are quite upset and believe that, in order for the market to truly stabilize, the authorities need to take drastic action, control prices at all stages to ensure people's rights.

The Ministry of Agriculture and Rural Development's request to adjust the price of live pigs is to ensure a sustainable market and stabilize the consumer price index. Because high prices will lead to many consequences such as spontaneous livestock farming, smuggling of livestock products, leading to disease risks, and not ensuring food safety.