China's Pig Herd Rises for First Time in a Year in November

BEIJING, Dec 9 (Reuters) - China's pig herd increased by 2% in November compared with the prior month, the agriculture ministry said on Monday, the first increase in a year.

Sow stocks were up 4% on October, said the Ministry of Agriculture and Rural Affairs on its website, the second consecutive month of a rise in the breeding herd inventory.

The closely watched data comes after an epidemic of African swine fever devastated the world's top hog herd, reducing it by 41% year on year by October.

While some analysts have described official numbers as conservative, the ministry figures would still equate to a decline of around 175 million pigs in the national herd.

Dutch firm Rabobank has estimated the herd will be 55% smaller by the end of this year, while others in the industry believe it could be even smaller.

Pork prices have surged to record levels, pushing consumer inflation in China to the highest level in almost eight years, and putting Beijing under growing pressure to ensure supplies ahead of important upcoming holidays.

Recent policies to stabilise production and support the recovery of the pig herd have begun to show results however, said Yang Zhenhai, director of the ministry's Animal Husbandry and Veterinary Bureau in the statement.

Ministry data also showed that production of pigs in large-scale farms, or those slaughtering more than 5,000 head a year, increased by 1.9% in November compared with October, while their sow stocks were up 6.1% month on month.

Yang said however that supplies will be tight ahead of the upcoming Lunar New Year holiday in late January, after the supply of hogs fell sharply between June and August this year.

Higher imports and the release of frozen pork from state reserves and commercial warehouses should boost supply however, while high prices will curb consumption.

"The overall supply and demand situation may be better than expected," Yang said in the statement.

(Reporting by Dominique Patton; Editing by Edmund Blair and Louise Heavens)

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