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China pork crisis
EconomyChina Economy

China’s new pig farmers determined to ‘hold on’ despite big swings in pork prices

  • Surging output and Covid-linked demand interruptions have driven down pork prices by 70 per cent this year
  • Despite heavy producer losses, many new farmers are determined to ride out the boom-bust cycle

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Many Chinese breeders are struggling to pay their suppliers, as pork prices have fallen by 70 per cent this year. Photo: Reuters
Reuters

China’s huge hog sector is struggling with excess production after millions of small, often first-time, pig farmers entered the industry to capitalise on record profits during a swine-fever related shortage.

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Now, even as prices hover below the cost of production and the government urges them to cull their herds, many of the newcomers are reluctant to give up, dimming hopes for the market returning to balance.

“We’ve been losing 400,000 yuan (US$62,500) a month since July. But we made a profit last year so we’re going to hold on,” said Wu Zhanhang, a farmer based in central Henan, China’s top pig-producing province.

Wu, like many others, entered pig farming for the first time in 2019, after China’s top leadership called for an urgent recovery following a nationwide outbreak of the deadly African swine fever virus that halved the country’s 447 million-strong herd.
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Profits initially boomed in line with higher prices for pork, the country’s favourite meat. But surging output and Covid-linked demand interruptions have driven down prices by 70 per cent this year, causing heavy producer losses over the past three months.
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