Research On The Calming Effect Of Hog Futures On The Fluctuation Of Pig Price

Pork products are the daily necessities of Chinese people.Although pork consumption has declined with the improvement of living standard in recent years,its total consumption still accounts for more than 60% of meat consumption.Pig industry is an important basic industry in China.However,due to the lack of effective price guidance mechanism in pig breeding,the phenomenon of "cobweb" is obvious and the output is unstable,which leads to frequent fluctuations in the price of live pigs in China,and the fluctuation range is increasing.Since the compilation of China Animal Husbandry Yearbook in 1999,the price fluctuation of live pigs in China has gone through five cycles.The frequent occurrence of price risk is extremely disadvantageous to the development of pig breeders and related enterprises in China.It has seriously affected the integration process of Chinese live pig industry,restricted the standardization and large-scale development of our pig industry,and faced with the price risk caused by the frequent fluctuations of spot market prices.Relying solely on the adjustment and development of industry itself and the macro-control of the government can not effectively solve the existing problems.This requires the introduction of other effective means,and pig futures are ready to emerge.The trading of live pig futures and the trading measures of live pig futures,which were put forward in the first document of the Central Committee in 2009,have received extensive attention and support from all walks of life.For the first time,it is proposed that futures be used to stabilize the instability of production and the fluctuation of prices in the spot market of live pigs.In February 2018,Dachang pig futures project was approved.As the largest animal husbandry breed in the world and the largest agricultural breed in China,the listing of pig futures will provide effective risk management tools for pig breeding enterprises in China,and further help the healthy development of agricultural industry in China.Based on the theory of price discovery and hedging mechanism,cobweb theory and economies of scale,this paper uses Census X12 seasonal adjustment method and HP filter method to study the monthly price data of live pig spot market in China from 2000 to 2017,and then explores its fluctuation characteristics.Then,from three aspects: price discovery,hedging and large-scale farming.This paper studies the mechanism of pig futures' stabilizing effect on spot price and combines the restrictive factors of pig futures' stabilizing function with the current situation of pig industry,and puts forward some countermeasures and suggestions accordingly.This paper finds that the price fluctuation of hog in China has obvious seasonality and periodicity.The direct effect mechanism of futures on price fluctuation is to optimize the market resource allocation through price discovery function and hedging function,and help the various entities in the industrial chain to better transfer risks.In order to stabilize the production of pigs;the indirect mechanism is that the introduction of futures will help guide the scale of the industry,better respond to fluctuations in pig prices through scale advantages,stabilize production,and thus stabilize price fluctuations.For the possible problems in the listing of hog futures,this paper proposes to establish a national unified market standard,improve the scale of the hog breeding industry by combining environmental protection policies and industrial support policies,and respond to the lack of spot liquidity by means of cold chain transportation.The problem and the scientific design of futures delivery methods to ensure the smooth launch of China's hog futures and play the function of price stabilization.