Pig prices drop below 10 yuan/kg, hitting a decade-low! The most difficult "pig cycle" has arrived.

Source: Securities Times Online; Author: Zhao Liqing

On April 3, the domestic live hog futures’ benchmark contract price inched down to 9,370 yuan per ton, hitting a new low since the listing. Meanwhile, in the spot market, the average ex-farm selling price for hogs fell to below 10 yuan per kilogram, already the lowest point in more than ten years.

In the view of industry insiders, 2026 will be the “most difficult year” among the past few hog cycles. Against this backdrop, since 2026, the state has carried out two rounds of central government hog reserve purchasing programs to backstop hog prices.

Multiple interviews conducted by a Securities Times reporter revealed that hog prices have now fallen below the industry’s average cost line, and the breeding end is generally trapped in a loss situation. Unlike in the past, during this round of hog price declines, the industry’s capacity reduction progress has been relatively slow, and it will still take time for the market to clear.

Most analysts believe that before capacity is reduced substantively, hog prices in the short term are highly likely to remain in a low-level, sideways-to-choppy pattern. Facing the cyclical trough, current breeding enterprises are “getting through the winter” by cutting costs and improving efficiency, optimizing their financial structure, expanding into overseas markets, and other measures to enhance their ability to withstand risks.

Hog prices hit a low in more than ten years

On March 31, the domestic average ex-farm selling price for live hogs fell to 9.43 yuan per kilogram. This price is already “cut in half” compared with August 2022, and it is down more than 76% compared with the historical high of 40.38 yuan per kilogram recorded in November 2019, making it the lowest level in nearly fourteen years.

“With this price, there’s no real profit to talk about when raising hogs; it’s good enough if I can lose a little less.” Liu Liang, a hog farmer in Zhumadian, Henan, who has a sow capacity of about 300 head, said that in the just-finished March, the selling price of 6-kilogram piglets fell from over 300 yuan to below 250 yuan. Piglet sales no longer generate any profit. If he continues fattening them into market hogs, he will likely fall further into losses, so he can only sell them as soon as possible.

In the same city, Zhumadian, Wang Kai purchased a batch of piglets in late March to stock up on the hog houses that had already been cleared before the Spring Festival. In his view, compared with last year’s price of over 500 yuan per piglet, the current average piglet cost is extremely low.

“With prices falling like this, they probably won’t go down any further. Based on today’s piglet and feed costs, by August this year, when they grow into market hogs ready for slaughter, the cost per jin will be around 5.1 yuan. If hog prices can recover slightly over the next few months, even one hog could bring a profit of a hundred or so yuan.” He described his hopes.

In March 2026, losses in the hog farming industry kept worsening.

According to data from Shanghai Steelhome, in March the national average live hog price was 11.64 yuan per kilogram, down another 1.69 yuan per kilogram from February. In that month, the average loss per head for pigs raised by self-breeding and self-raising reached 257.53 yuan, widening by 207.38 yuan month-on-month; the average loss per head for purchasing feeder piglets reached 157.95 yuan, widening by 156.96 yuan month-on-month.

“In 2026, the industry indeed has entered the most difficult year among the past few cycles.” At a recent earnings briefing for a listed company in the hog farming industry, a company executive made such a remark.

In interviews, multiple executives from listed companies in the hog farming industry told the Securities Times reporter that with current market hog prices of more than 4 yuan per jin, the entire industry has already fallen into a loss state.

Small retail farmers’ perception of industry cycle volatility is even more direct.

“Over the past three years, the hog industry has actually been in a downward cycle all along. 2023 and 2024 were only periods of profitability, but by 2025 it gradually started to fall into losses. The length of the sluggish market has clearly exceeded the usual rhythm of a three- or four-year cycle in the past. Many small farmers couldn’t hold on and exited on their own.” Liu Yuzhen said. Since the African swine fever outbreak in 2018 caused a shock, the proportion of small farmers doing self-breeding and self-raising has dropped significantly. As for those who still have the willingness to raise hogs, most have shifted to secondary fattening. Years ago, there were about 40 to 50 self-breeding and self-raising households in the township and village where Liu Yuzhen lived, including more than ten larger-scale ones. But now, the number of people raising hogs in the town is down to just a handful, and among those still persisting with large-scale self-breeding and self-raising, only Liu Yuzhen remains.

Capacity reduction still needs time

Facing the market situation of sustained weak hog prices, in recent years the state has gradually optimized the hog production capacity control mechanism, guiding practitioners to arrange production plans reasonably. Especially since 2025, relevant departments have conducted systematic regulation from multiple angles—reducing breeding capacity, lowering slaughter/marketing weight, restricting second-stage breeding—so that the results of capacity reduction have begun to show.

Earlier, Muyuan Co., Ltd. provided data showing that in January to February 2025, the company’s highest number of breeding sows on hand was 3.62 million head, but by January 2026 it had been reduced to 3.13 million head. A cumulative reduction of nearly 500,000 head.

A relevant executive at New Hope also said that to respond to the government’s policy call, the company has been gradually reducing the number of breeding sows since the third quarter of last year, dropping from 760,000 head in mid-2025 to 740,000 head at the beginning of January 2026.

However, the main reason why hog prices continue to fall is still the imbalance between supply and demand on both sides of the industry.

One listed-company executive said that in recent years, African swine fever has forced companies to improve management levels and biosecurity systems, and the industry’s overall farming level has improved significantly. Data such as sows’ PSY (the number of weaned piglets provided per sow per year) has risen, and the average quantity of veterinary medicine used has also shown a downward trend compared with earlier periods. All of this reflects improvements in pigsty environment and health management capabilities. In addition, hog farming has the characteristics of continuity and long cycles, so policy control cannot take effect immediately; capacity reduction still takes time.

“As a whole from 2024 to the third quarter of 2025, the hog farming industry was in a profitable zone, and the main scalable entities continued to follow the inertia of capacity expansion. Although by the end of 2025, the national stock of breeding sows dropped to 39.61 million head, nearly 1 million head less than at the beginning of the year, due to the combined effects of improved breeding sow production efficiency, somewhat high market weights, and secondary fattening, etc., the pressure on current hog supply remains quite high.” The above listed-company executive said.

When talking about their judgment of the hog price trend in 2026, the executive from New Hope believed that in the first half of the year, hog prices might generally be in a bottoming-out stage. They expect that as the effects of earlier capacity controls gradually become visible, and with pork consumption moving out of the off-season, the market’s supply-demand relationship may improve in the second half of the year.

A relevant executive from Wen’s Group Co., Ltd. also said in an interview with a Securities Times reporter that hog prices have continued to weaken since October 2025 and are now in the bottom range. “It’s hard to clearly determine the timing of a price reversal. At present, prices are at historical lows, so the possibility of continued decline is small.” he said.

An interviewee from Muyuan Co., Ltd. believed that, according to monitoring data from the National Bureau of Statistics and the Ministry of Agriculture and Rural Affairs, starting from the second half of 2025 the industry’s capacity began to be reduced, indicating that in the first half of 2026 hog marketings will still have sufficient supply. Combined with the impact of the consumption off-season after the Spring Festival, hog prices are likely to test the lowest point of the year. Under the joint effect of the government’s integrated hog capacity regulation and market-driven adjustment, the effect of capacity reduction is expected to become increasingly apparent from the end of the second quarter onward. As the supply-demand relationship gradually improves, hog prices may stop falling and stabilize, and with further support from the consumption peak season in the second half of the year, hog prices may rise mildly. Therefore, the hog price for the full year of 2026 is expected to show a pattern of low prices first and then higher.

“Compared with downward phases in previous hog cycles, this declining cycle lasts longer and the rebound strength is weaker. The ‘bottom-sideways grinding’ feature is even more evident.” Sun Zilei, an analyst at Shanghai Steelhome, said bluntly. Based on indicators such as the stock of breeding sows, the number of hogs marketed, and the duration of sustained industry losses, the current hog market has entered the bottom range of the hog cycle. However, supply pressure has not yet been fully relieved, and capacity reduction is still insufficient. In the short term, there is still a possibility that hog prices could continue to test lower levels. As for the true cyclical bottom, it will need to be confirmed only after breeding sow numbers are further reduced and marketing pressure is clearly eased.

Optimize internal operations and push overseas markets

In the face of a weak market, listed companies in the hog farming industry are taking multiple measures to enhance their ability to get through the low point of the cycle.

“In the current market conditions, the company will adopt a more prudent operating strategy. We will prioritize cash-flow safety, ensuring the company has sufficient financial resilience during volatile conditions.” The above Muyuan Co., Ltd. interviewee said. The company will continuously optimize its debt structure, make rational use of various financing tools to lower financing costs, keep financial indicators at a safer and healthier level, and improve the company’s overall operating quality.

After listing on the Hong Kong Stock Exchange in February 2026, Muyuan Co., Ltd. will also use global capital to empower the development of the industry.

The above Muyuan Co., Ltd. interviewee said that this year the company will continue to advance the existing cooperation projects in Vietnam in a steady manner, while actively exploring development opportunities in other countries, and strengthening the building of overseas business teams. Over the next 3 to 5 years, the company hopes to find in more countries and regions the key areas where it can create value for the local hog farming industry, and by exporting solutions, truly and practically address local industry pain points.

Wen’s Group Co., Ltd. has also recently disclosed that it will treat “going overseas” as an important strategic direction and set up a dedicated exploration team to advance the related work. The company will rely on years of overseas experience and channel resources accumulated in business areas such as animal healthcare/protection, agricultural and livestock equipment, and environmental protection. It will prioritize pushing its broiler business overseas, with its first stop selected as Vietnam, a country adjacent to China. Its initial goal is to capture about 10% of Vietnam’s yellow-feather broiler market. Going forward, depending on overseas development, it will gradually expand into other businesses such as hogs and ducks, and further tap the growth potential of international markets.

“Currently, overseas livestock farming markets have room for significant development. In recent years, domestic companies have already accumulated relatively strong competitive advantages, and their ability to control costs on the production side has improved. They have opportunities and capabilities to export technology.” When discussing its development plan, the above executive from Wen’s Group Co., Ltd. said that in 2026 the company will continue to focus on internal production and operations, keep improving production efficiency, and strengthen internal management and operational optimization. It is confident and capable of successfully going through this round of sluggish cycle and achieving new development.

The above executive from New Hope also mentioned that the company’s farms currently cover 116 cities across 25 provinces nationwide, completing the fixed-asset capacity layout. In the future, the company will dynamically adjust its breeding-asset layout according to factors such as production costs and disease prevention and control in each region—for example, in the western and South China regions, farming costs are relatively lower, so the company’s investment in biological assets tends toward those regions to increase the share of hogs delivered for slaughter. While keeping the free-range rearing mode basically stable, in the future the company will gradually increase the quantity and proportion of self-bred and self-fattened hogs delivered for slaughter. By strictly focusing on production management, it will continuously reduce the cost of raising hogs.

(Editor: Wen Jing)

Keywords:

                                                            Hog prices