China’s national average hog price dropped to 8.63 yuan per kilogram, hitting a ten-year low and plunging the entire farming sector into deep losses.
The downturn deepened as traditional fourth-quarter consumption failed to absorb excess market supply, according to Epoch Times. Wholesale hog prices breached the previous April low of 8.77 yuan per kilogram, driven by persistent oversupply and weak terminal consumption that left seasonal recovery expectations unmet.
Industry margins have deteriorated severely across the board. Data from agricultural consultancy Boyar Information showed that self-bred and self-raised operations suffered an average loss of approximately 396.7 yuan per head on November 6, according to Epoch Times. Meanwhile, Ministry of Commerce data showed the pig-to-grain ratio dropped to 4.22 on October 28, remaining below the primary early warning threshold for excessive declines.
Corporate balance sheets reflect widespread financial distress among publicly traded producers. Twenty-five A-share hog companies reported a combined net loss of 24.473 billion yuan for the first three quarters, swinging from profit to loss year over year, Epoch Times reported. Excluding Shuanghui Development, which posted a profit of 36.42 million yuan primarily from meat processing, the remaining 24 companies combined for a net loss of 28.115 billion yuan.
Corporate debt-to-equity ratios have climbed. Wens Foodstuff Group saw its asset-liability ratio rise from 58.94 percent to 59.15 percent, while Muyuan Foods’ ratio increased to 55.89 percent. Other regional producers faced higher debt burdens, with Tianbang Food reaching 91.84 percent and Xinfeng reaching 89.98 percent when the third quarter closed.
African swine fever outbreaks have compounded the crisis, triggering panic selling and forced culling by major agricultural groups and smallholders alike. In regions including Hubei, Guizhou, and Xinjiang, standard market hogs fell below 4 yuan per jin in early November, according to New Tang Dynasty Television.
“This year there is no break-even price, it is ‘falling and falling’, the more they produce, the more there are; pork is cheaper than vegetables. Generally, when it breaks 4, it is basically because there are sick pigs. Pig farming is too difficult, you lose everything, everyone loses everything. Now many people are bottom-fishing and losing their homes.” a Liaoning hog farmer identified as Quan said, as reported by New Tang Dynasty Television.
Producers report that local financial institutions have tightened credit lines to the sector.
A corporate farm employee identified under the pseudonym Wang told New Tang Dynasty Television that at a facility operating with more than 130 workers last year, staff numbers were reduced to roughly 50 workers despite an increase in production capacity, with technicians reassigned to feed livestock while facing strict financial penalties for excessive feed ordering or storing feed in silos for longer than five days.
Zhuochuang Information analyst Fan Qingqing added that sluggish terminal demand and weak seasonal support have left the market struggling under excess inventory.
The broader agricultural slowdown dragged down national inflation metrics. China’s consumer price index rose 0.7 percent year-over-year in October, falling below market expectations and hitting a three-month low, with food prices declining 2.9 percent due largely to falling meat and vegetable costs, Epoch Times reported.