Eggs: Decline Continues, High Prices No Longer Sustainable

I. Egg Market Analysis

Today, the downward trend in egg prices became evident in major production areas. The average price of red-shelled eggs was 4.96 yuan/jin, and the average price of pink-shelled eggs was also 4.96 yuan/jin, with red-shelled eggs taking the lead in declining, and the price spread between red and pink eggs temporarily eliminated. The average price in major production areas was 4.93 yuan/jin, down 0.17 yuan/jin compared to the previous trading day. The egg market continued its weak trend today, with declining regions dominating.

 Previously, the widening spread between red and pink eggs attracted outside traders to increase procurement from pink egg production areas, stabilizing pink egg prices. However, red egg production areas still showed no sign of price stabilization, with prices continuing to fall and inventory accumulation pressure rising in the circulation chain. A wait-and-see sentiment dominated the trading segment, with procurement strategies becoming conservative, and market transactions showed no significant improvement.

Egg Market Price

II. Egg Market Outlook

Supply Side

Supply-side pressure continues to manifest. Newly opened laying hens are constantly increasing, and with egg production rates gradually recovering as temperatures fall, market supply is becoming increasingly abundant, with inventory accumulating across all stages of the supply chain. The supply-demand relationship has shifted from tight to loose, putting downward pressure on egg prices in multiple regions.

Demand Side

As school reopening stockpiling concludes, the market enters an inventory digestion phase, with all stages primarily consuming existing stock. Meanwhile, downstream participants lack confidence in the future market trend, with wait-and-see sentiment significantly increasing, procurement pace becoming conservative, and new procurement demand remaining limited.

Overall Outlook

Overall, the supply-side increase trend is clear, with inventory gradually accumulating. On the demand side, stockpiling has ended, and the terminal market is mainly digesting inventory, with no improvement in transactions. Egg prices are likely to continue their weak trend, with red egg production areas still having room for further decline, while pink eggs may briefly stabilize after the price spread is corrected. The market is expected to remain weak with fluctuations, with further declines in some regions.

III. Egg Futures Trend

On August 31, the Dalian Commodity Exchange (DCE) egg futures main contract 2610 opened at 3,790, with a high of 3,817, a low of 3,762, and a settlement price of 3,786, up 17/0.45%. Trading volume was 394,453 lots, and open interest was 187,237 lots.

IV. Egg Price Index Analysis

According to calculations by Lenglian Duoduo, on August 31, the domestic egg spot price index was 4.966, down 0.045 or 0.898% compared to the previous working day.