Egg Monthly: Peak Season Recedes, Egg Prices Enter "Off-Season Mode"!（Sep 29）

Egg Monthly: Peak Season Recedes, Egg Prices Enter "Off-Season Mode"!

September Market Review

In September, egg market prices exhibited a pattern of rising first then falling, with mid-month prices reaching the highest level of the year. By phase, in the first ten days of the month, prices largely maintained an upward trend, primarily driven by domestic consumption and restocking stimulus from the Mid-Autumn Festival holiday. With inventories at various levels in production areas currently low, demand-driven egg prices rose again. However, entering the last ten days, the market reversed direction, ending the upward trend and entering a downward channel. The main reason was that approaching the Mid-Autumn Festival, transaction volumes in sales areas decreased significantly. Traders proactively implemented risk controls and reduced procurement volumes, substantially lowering purchasing quotations. Egg shipment pace in production areas slowed, inventories increased, and the larger decline in pink egg production areas drove quotations down in red egg production areas as well.

Supply Analysis

In September, the supply side exhibited characteristics of "offsetting increases and decreases, with periodic tightness." Total layer flock inventory in major domestic production areas maintained normal levels. Newly laying hens continued to increase, but culled hen volumes rose in parallel, essentially offsetting each other with little change in total inventory. However, as temperatures declined, laying rates gradually recovered. Combined with relatively high enthusiasm among farming units for culling old hens, concentrated culling occurred in the first and middle ten days of the month, accelerating capacity reduction and periodically reducing the laying hen inventory. Overall, market egg supply pressure was not significant, with inventories at various levels generally low most of the time, and the supply side provided some bullish support for egg prices.

Demand Analysis

In the first ten days of September, inventories at various levels in production areas were low. Combined with restocking demand from the school opening season and Mid-Autumn Festival holiday, domestic consumption and terminal restocking drove another rebound. However, approaching mid-month, the market entered the pre-Mid-Autumn risk control phase. Procurement enthusiasm in the trade sector declined, inventories at various levels remained low, and egg prices maintained high levels after peaking. Sales areas for pink eggs led the production areas in pulling back first.

Supply Outlook

On the supply side, total layer flock inventory in major production areas is currently normal. Increases in newly laying hens and culling volumes offset each other, with little change in total inventory. However, as temperatures decline, laying rates are gradually recovering and egg weight gain is accelerating, partially offsetting the supply reduction from inventory decline. On the culling side, farming units show high enthusiasm for eliminating old hens, with concentrated culling occurring in the first and middle ten days of September, temporarily accelerating capacity reduction. Replacement pullets are successively entering the laying period, layer age structure is relatively balanced, the rate of decline in total inventory is narrowing, and supply volumes are expected to remain roughly stable going forward.

Market Data