Pig prices fall to nearly a 7-year low: What is the future for small and medium-sized farmers?

Ask AI · What impact does the exit of small- and medium-scale livestock breeders have on rural livelihoods?

Reporter Wang Hui

“A few days ago, the hog price fell to a new low in nearly seven years. Now when I sell one pig, I lose nearly 500 yuan.” said Old Wang, a hog breeder in Shandong with more than 20 years of experience.

Old Wang worked out the numbers for the reporter: the hog market-ready weight is calculated at 240 jin (about 120 kg). To grow each additional jin of pork, it requires 3.6 jin of feed. For one hog over the full cycle, a total of 864 jin of feed is needed. The current blended feed price is 1.55 yuan per jin. So, feed costs alone amount to 1,339 yuan. Old Wang uses a self-breeding and self-raising model. For each market hog, he also needs to allocate about 200 yuan for feed and health-care costs of old sows. In addition, there are miscellaneous expenses such as water and electricity, veterinary drugs, and vaccines, about 100 yuan per hog. The total cost per hog is 1,639 yuan.

He said that, based on the hog average price as of April 1 of about 4.8 yuan per jin, the loss per hog is about 487 yuan.

Old Wang currently keeps more than 200 hogs, and his family relies on this to make a living. “Now I can only hold them longer in the pens, hoping the price will rebound.” Old Wang said helplessly. But holding them longer means the hogs still consume large amounts of feed every day, which instead puts him in a vicious cycle of “the longer I raise them, the bigger they get—and the more I lose.”

Old Wang is just a snapshot of small- and medium-scale hog breeders among many. Data monitored by the Ministry of Agriculture and Rural Affairs shows that in the 4th week of March, the national average hog price had already fallen to 5.34 yuan per jin, down 3.3% month-on-month and down 29.8% year-on-year; the current price hits the lowest level since 2019.

On April 2, 2026, the Ministry of Commerce, the National Development and Reform Commission, and the Ministry of Finance announced that they will carry out the second batch of centralized procurement and storage of frozen reserve pork meat in the near term, with a plan to procure and store 10k tons of frozen pork lean meat that meets national standards. This is the second time the state has stepped in within one month, following the first round of reserve purchases in March.

Multiple industry experts told the Economic Observer reporter that, at present, the domestic hog market supply remains at a high level; the pace of clearing of inventory of breeding sows is relatively slow; and, combined with weak demand for pork consumption, these factors have led to prolonged low hog prices and sustained downward pressure over the long term. Large-scale breeding enterprises can maintain normal production capacity even if they run losses for a long time, thanks to ample capital, technology, and scale advantages. By contrast, small- and medium-scale breeders have limited capital and insufficient risk resilience, becoming the main group that gets “cleared out” during the process of capacity reduction.

Small- and medium-scale breeders accelerate their exit

“Right now it’s not just that hog prices are low; feed prices keep rising as well, further pushing up breeding costs.” Old Wang said.

For a long time, the hog-to-corn ratio (the ratio of the ex-farm hog price to the corn wholesale price) has been the industry’s “barometer” of profit and loss. According to data from the price monitoring center of the National Development and Reform Commission, in the 3rd week of March, the national hog-to-feed grain ratio had dropped to 4.40:1, the lowest since 2019, far below the 5:1 level that triggers a primary warning.

Old Wang said that the main reason for the rise in feed raw-material prices is international geopolitical conflicts, which increase trade uncertainty, pushing up corn and soybean meal prices and rapidly transmitting the increase to the breeding end, directly raising breeding costs.

Under the double squeeze of falling hog prices and rising feed prices, losses have emerged among hog breeders. According to data from Boya and Xun, the loss period for purchased weaned piglets in this round has been 13 months, while the loss period for self-breeding and self-raising has been 6 months. At present, losses for self-breeding and self-raising hog breeding have reached more than 340 yuan per head, the lowest level in 35 months.

The situation for Old Li, a hog breeder in Henan, is even more severe. His breeding farm has more than 300 hogs, and compared with the two previous years he has already voluntarily reduced the scale. To cut expenses, since last year Old Li has not hired workers—only his husband and wife handle the operations—yet he still cannot escape losses.

“I already owe the feed factory more than 10k yuan.” Old Li choked up as he told the reporter. If hog prices remain at low levels for a long time, the breeding farm will face closure, and his livelihood of more than 20 years will be hard to sustain.

Recently, the reporter interviewed multiple small- and medium-scale breeders in hog-producing regions—Shandong, Henan, and Sichuan. All of them are experiencing losses to varying degrees: some have started selling hogs at low prices at a loss; some choose to hold them longer and wait for prices to recover; and some directly cull sows and exit to do other lines of work…

The predicament of small- and medium-scale breeders is not an isolated case; even leading listed pig companies have not been spared. According to the companies’ disclosed 2025 annual reports, Muyuan Shares’ net profit attributable to shareholders was 15.81B yuan, down 16.45% year-on-year; Wen’s Shares’ net profit attributable to shareholders was 5.24B yuan, down 43.59% year-on-year; and New Hope expects its net profit attributable to shareholders to be a loss of between 1.5 billion yuan and 1.8 billion yuan in 2025, turning from profit to loss year-on-year.

Leading pig companies have begun to rely on their own advantages and take targeted measures to respond to market volatility. Muyuan Shares said the company will use technologies such as hog breeding, nutrition formulas, health management, and smart technologies to reduce breeding costs. Wen’s Shares said the company operates with a “pig and chicken dual-main business,” enabling it to better hedge the risk of price volatility in a single business…

By contrast, small- and medium-scale breeders are generally speeding up their exit. According to monitoring data from the Ministry of Agriculture and Rural Affairs, in 2018 the national hog breeding scale (large-scale) rate was 49.1%, and by 2025 it had risen to about 73.0%. At the same time, industry concentration has increased significantly: in 2018, the top 10 pig-breeding companies in China accounted for 8.1% of the total national hog sales volume; by 2025, this had risen to 29.7%.

Based on monitoring data from the Ministry of Agriculture and Rural Affairs, the Chinese Academy of Agricultural Sciences’ Institute of Agricultural Economics and Development estimates that at the end of 2025, the number of small-scale backyard hog farmers across the country was about 16.72 million households. Compared with 27.06 million households at the end of 2018, this is a decrease of 38.2%, and the exit speed has accelerated, creating pressure on farmers’ employment and income growth.

Slow capacity reduction

Wang Zuli, a researcher from the Chinese Academy of Agricultural Sciences’ Institute of Agricultural Economics and Development and a scientist for the industrial economics post under the National Hog Industry Technology System, introduced that the main reasons for the current hog price downturn are the combined effect of three factors: supply at a high level, weak consumption, and pessimistic market sentiment.

Among them, imbalance between supply and demand is the main cause. At present, market supply remains at a historical high. In recent years, hog breeding efficiency has improved rapidly, further amplifying the pressure of market supply. Hog sales volume and pork output have continued to stay in a saturated state.

Starting from May 2025, under the combined effects of market pressure and policy guidance, the hog industry has fully begun capacity reduction. However, the core contradiction of “excess capacity and insufficient demand” has not fundamentally changed.

From the supply side, data from the National Bureau of Statistics shows that as of the end of December 2025, the number of stockbreeding sows nationwide was about 39.61 million head, up to a cumulative reduction of 2.9% compared with the end of November 2024. But the current inventory level is still relatively high historically, leaving room for further capacity reduction.

From the consumption side, consumption is constrained by population aging and a slowdown in economic growth. Consumption upgrading is limited, and the meat consumption structure is transitioning from pork dominance toward more diversified beef, mutton, and poultry consumption. In addition, March to April are traditional off-season periods for consumption after the Spring Festival; residents mainly consume pork reserves stored before the holiday, and market purchasing demand falls to the year’s low point, providing almost no support for hog prices.

Regarding the issue of slow capacity reduction that has drawn market attention, Wang Zuli believes it is mainly influenced by the following factors: before September 2025, the industry still retains some space for profitability, and the willingness of breeding entities to voluntarily reduce capacity is generally weak; the market features a game mentality—some breeding entities hope that other entities will reduce capacity first so they can capture the subsequent industry rebound bonus; in addition, capacity reduction will lower capacity utilization, raise unit breeding costs, and further weaken the inherent motivation for enterprises to proactively cut capacity.

In recent years, the state has increased support for large-scale hog breeding through policies, and the industry is developing toward intensive, modern, and standardized directions.

Wang Cheng, an expert from the Shandong Academy of Agricultural Sciences’ Institute of Animal Husbandry and Veterinary Medicine, pointed out that in this process, hog breeding is gradually moving away from its own industrial logic and becoming increasingly “financialized.” Hog price swings are like stock markets—surging and plunging in big moves. Prices are led by capital and leading enterprises rather than by supply-and-demand fundamentals.

Wang Cheng disclosed that the Shandong provincial animal husbandry and veterinary bureau had conducted a continuous survey in multiple towns and townships in Chiping District of Liaocheng. The data showed that from 2020 to the end of 2024, the number of small and medium-sized breeders in the area had shrunk by 61.3%.

In Wang Cheng’s view, the hog industry currently shows a clear split among entities. Large-scale breeding groups, backed by advantages in capital, technology, and scale, can maintain production capacity even if they run losses for a long time, leaving the industry in a competitive state of “who can endure better.” In a highly financialized market environment, small- and medium-scale breeders lack policy subsidies, financial support, and market pricing power, making them the main group that is passively cleared in this cycle.

How to save themselves?

Wang Zuli emphasized that scale is a long-term trend in hog industry development, but scale is not the same as groupization. As an important people’s livelihood industry, the hog industry involves small- and medium-scale breeders carrying the livelihoods of rural families and the function of rural industrial revitalization. They have irreplaceable social value. Industrial development needs to balance the coordinated development of large-scale breeding groups and small- and medium-scale breeders.

During the national Two Sessions in 2026, Xie Rupeng, a deputy to the National People’s Congress, said that for each additional 1% of scaled capacity, about 3% to 5% of individual households exit. Based on projections for新增 hog capacity in 2025, it could result in 500k to 800k individual households with annual sales volume below 500 head losing their livelihood. Over-scaled development not only squeezes the survival space of small- and medium-scale breeders, but also leads to large companies suffering major losses, and the market becomes filled with low-quality, low-price products.

There has already been a clear response at the policy level. In November 2025, the Ministry of Agriculture and Rural Affairs reviewed and, in principle, passed the “Opinions on Strengthening Comprehensive Capacity Regulation to Promote High-Quality Development of the Hog Industry,” which stated that while guiding large hog enterprises to improve quality and efficiency and develop in a stable manner, support should be given to small- and medium-scale breeding farms to develop an appropriate scale of breeding, in order to build a high-quality hog industry development pattern with dynamic matching between supply and demand and a reasonable scale structure.

Wang Cheng believes that in the context of the hog market becoming increasingly financialized, small- and medium-scale breeders should reduce breeding costs and cannot follow the usual feed route like big enterprises. He suggested abandoning the conventional corn and soybean meal feed方案 and switching to region-based feeds. For example, in the Jiaodong area, by-products produced from sweet potato processing—such as sweet potato peels and small sweet potato pieces—as well as by-products like fruit dregs from food-processing enterprises can fully meet hog growth needs after scientific formulation, and are suitable for the actual operating conditions of small- and medium-scale breeders.

In addition to cost reduction and efficiency gains, Wang Zuli also suggested that the industry must strictly adhere to the bottom line of disease prevention and control. During periods of industry downturn, disease risk rises; production must be stabilized to avoid major losses. Second, explore a “pool together” development model. By forming cooperatives, breeders can achieve unified purchasing and shared technology, improving their ability to negotiate in the market. Through a “company + farmers” model to lock in returns, risks from market price volatility can be reduced. In addition, breeders should stick to rational selling—according to standard body weight, sell hogs promptly as conditions become favorable—and avoid panic selling or blindly holding hogs longer.

On April 2, to maintain stable pork market operations, the Ministry of Commerce, the National Development and Reform Commission, and the Ministry of Finance are currently carrying out centralized procurement and storage of frozen reserve pork meat.

Wang Zuli explained that when the state carries out reserve purchases of frozen pork meat, on the one hand, it is to ease supply pressure in the hog market. By procuring and storing pork into reserves, it boosts market demand and thereby eases pressure from falling hog market prices. On the other hand, it is also to release a signal of the state using policy to support the market, stabilize industry expectations, strengthen market confidence, and guide breeders to sell hogs in an orderly manner, preventing panic in the industry.

In Wang Cheng’s view, the impact of this round of frozen pork reserve purchases on the entire market may be limited, but it will to a certain extent add confidence to breeders. Whether the situation improves depends on the actual, substantive reduction of capacity.

Multiple industry experts predict that short-term hog price issues will still feature unresolved supply-and-demand contradictions, and prices will be unlikely to rise significantly.

Wang Cheng said that hog prices this year are expected to have little chance of improvement, and that the market may improve in the second half of next year.

Wang Zuli said that under the combined effects of market adjustment and policy regulation, hog capacity is being orderly reduced, but it will take time for the reduction to transmit into the market’s supply volume. Based on a comprehensive judgment of current supply-and-demand conditions, the hog industry is now in a “bottoming-out period,” and it is expected that the second half of the year will see some improvement, though the magnitude will be relatively limited.