Pig prices hit a decade-low! The most difficult "pig cycle" is approaching, and breeding companies are taking multiple measures to "weather the winter."

On April 3, the domestic hog futures’ main contract price inched down to 9,370 yuan per ton, reaching a fresh low since it began trading. Meanwhile, in the spot market, the average hog selling price fell to below 10 yuan per kilogram, already the lowest level in over ten years.

In the view of industry insiders, 2026 will be the “most difficult year” among the past several pig cycles. Against this backdrop, since 2026, the government has carried out two batches of central government hog reserve purchases to support prices.

Interviews conducted by Securities Times reporters with multiple parties found that current hog prices have fallen below the industry’s average cost line, and the breeding side is generally facing losses. What is different from previous rounds is that during this round of hog price decline, 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 materially reduced, hog prices in the short term are likely to remain in a low-range, sideways-to-volatile pattern. Facing the bottom of the cycle, breeding companies are “getting through the winter” by cutting costs and improving efficiency, optimizing their financial structure, expanding overseas markets, and other measures to enhance their ability to withstand risks.

Hog prices hit a low not seen in more than a decade

On March 31, the domestic average hog selling price inched down to 9.43 yuan per kilogram. This price is already a “halving” compared with August 2022, and is down by more than 76% compared with the historical peak of 40.38 yuan per kilogram in November 2019—marking a new low in nearly fourteen years.

“At this price, you can’t really say pig farming is profitable. If we can at least lose less, that’s good enough.” Liu Liang, a hog farmer in Zhumadian, Henan, who has about 300 head of sow-capacity, said. In the just-ended March, the selling price of 6-kilogram piglets fell from over 300 yuan to below 250 yuan, leaving piglet sales with no profit at all. If he continues raising them into market hogs, he will likely fall further into losses, so he can only sell them as soon as possible.

Also in Zhumadian, Wang Kai, a breeder, had just purchased a batch of piglets in late March to fill pig pens that had already been cleared before the Spring Festival. In his view, compared with last year’s price of over 500 yuan per head, the current average piglet price cost is extremely low.

“With prices falling like this, it shouldn’t go down further. Based on current piglet and feed costs, by August this year when they reach market hog size, the cost per jin will be around 5.1 yuan. If hog prices can recover slightly over the next few months, one hog could still generate a profit of a hundred-odd yuan.” He said, imagining it.

In March 2026, the loss situation in the hog breeding industry continued to worsen.

Data from Shanghai Steelhome shows that in March, the national average hog price was 11.64 yuan per kilogram, down another 1.69 yuan per kilogram from February. In that month, the average loss for hogs bred and raised entirely in-house reached 257.53 yuan per head, widening by 207.38 yuan month-on-month; the average loss for purchased piglets reached 157.95 yuan per head, widening by 156.96 yuan month-on-month.

“In 2026, the industry really has entered the most difficult year among the past few cycles.” At a company performance briefing for a listed hog-breeding company held recently, a company executive expressed this sentiment.

In interviews, multiple executives from listed companies in the hog breeding industry told Securities Times reporters that with current market hog prices at more than four yuan per jin, the entire industry has already fallen into losses.

For small standalone farmers, the impact of industry-cycle fluctuations is even more directly felt.

“Over the past three years, the hog industry has essentially been in a downward cycle. 2023 and 2024 only saw profit at the stage level, but by 2025 it started gradually falling into losses. The weak market has lasted noticeably longer than the usual three- to four-year-per-cycle rhythm in the past. Many small farmers couldn’t hold on and chose to exit on their own.” Liu Yuzhen said. Since the African swine fever outbreak hit in 2018, the proportion of small farmers raising pigs from breeding stock has dropped sharply. People who still have the intention to raise pigs mostly shifted to secondary fattening instead. In the village and township where Liu Yuzhen worked years ago, there were four or fifty or so households raising pigs from breeding stock, with about a dozen scaling up; but now there are only a handful of pig farmers in town, and only Liu Yuzhen remains practicing scaled breeding-from-sows.

Capacity reduction still needs time

With the market situation of sustained low hog prices, in recent years the central government has gradually optimized the hog capacity regulation mechanism and guided practitioners to arrange production plans rationally. In particular since 2025, the relevant departments have carried out systematic regulation from multiple angles such as reducing breeding capacity, lowering animal weights, and limiting second-cycle fattening, and early results of capacity reduction have begun to show.

According to a prior report from Muyuan Co., the company’s highest inventory of breeding sows in January to February 2025 was 3.62 million head, but by January 2026 it had been adjusted down to 3.13 million head. A cumulative reduction of nearly 500,000 head.

A related person from New Hope also said that to respond to the national policy call, the company began gradually cutting its inventory of breeding sows starting from the third quarter of last year, reducing them from 760,000 head in mid-2025 to 740,000 head at the beginning of January 2026.

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

A listed company executive said that in recent years African swine fever has forced companies to improve management standards and biosecurity systems, and the industry’s overall breeding level has increased significantly. Data such as sow PSY (the number of weaned piglets provided per sow per year) has improved, and the average usage of veterinary drugs per head has shown a downward trend compared with earlier periods. These all reflect improved pigsty environments and better health management capability. In addition, hog breeding has the characteristics of continuity and long cycles; policy regulation cannot take immediate effect, so capacity reduction still requires time.

“From the third quarter of 2024 to 2025, the hog breeding industry as a whole was in a profitable range, and scale-based entities continued with the inertia of expanding capacity. Although by the end of 2025 the national inventory of breeding sows fell to 39.61 million head, down nearly 1 million head from the start of the year, due to the combined effects of improved production efficiency of breeding sows, higher-than-normal market weight at sale, and factors such as secondary fattening, the current pressure on hog supply remains considerable.” the aforementioned listed company executive said.

Regarding its judgment on the hog price trend in 2026, the above-mentioned executive from New Hope believed that in the first half of the year hog prices may generally be in a bottoming-out phase. It is expected that as the effects of earlier capacity regulation gradually become visible, along with pork consumption exiting the off-season, the relationship between supply and demand in the second half of the year is likely to improve.

A relevant executive from Wen’s Group also said in an interview with Securities Times reporter that hog prices have continued to weaken since October 2025 and are now in a bottom-range. “It’s not easy to clearly determine the timing of a price reversal. With prices already at historical lows, the likelihood of continued downward movement is relatively small.” he said.

The interviewee from Muyuan Co. believed that according to monitoring data from the National Bureau of Statistics and the Ministry of Agriculture and Rural Affairs, since the second half of 2025 the industry’s capacity has begun to be reduced, implying that in the first half of 2026 hog slaughtered for sale will still have ample supply. Combined with the impact of the consumption off-season after the Spring Festival, hog prices are likely to reach the annual low point. Under the joint effect of comprehensive hog capacity regulation by the government and market-driven adjustments, the effect of capacity reduction is expected to gradually become visible starting from the end of the second quarter. As the relationship between supply and demand improves, hog prices may stop falling and stabilize. Further driven by the stronger consumption season in the second half of the year, hog prices could rise moderately. Therefore, the hog price for the full year 2026 is expected to show a pattern of low before high.

“Compared with previous down phases of pig cycles, this down cycle is longer and the rebound is weaker, making the bottoming-and-grinding characteristics more evident.” Shanghai Steelhome analyst Sun Zilei said. Judging by indicators such as the inventory of breeding sows, the volume of hogs sold, and the duration of ongoing industry losses, the current hog market has entered the bottom segment of the hog cycle. However, the supply pressure has not yet been fully alleviated, and capacity reduction is still insufficient. In the short term, there remains a possibility that hog prices will continue to probe lower. To confirm the true cycle bottom, it will still be necessary to wait until the inventory of breeding sows is further reduced and sale pressure is noticeably relieved.

Optimize internal operations and drive the overseas market

Facing a weak market environment, listed companies in the hog breeding industry are taking multiple measures to enhance their ability to get through the current low point of the cycle.

“Under the current market conditions, the company will adopt a more cautious operating strategy, with cash-flow safety as the top priority, ensuring the company has sufficient financial resilience during volatile conditions.” the aforementioned interviewee from Muyuan Co. said. The company will continuously optimize its debt structure, make rational use of various financing tools to reduce 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. will also use global capital to empower industrial development.

The above-mentioned executive from Muyuan Co. said that this year the company will continue to steadily advance existing cooperative projects in Vietnam, while actively exploring development opportunities in other countries and strengthening the construction of its overseas business team. Over the next 3 to 5 years, the company hopes that in more countries and regions it can find areas where it can create value for local hog breeding industries, and through exporting solutions, address local industry pain points in a practical and concrete way.

In recent days, Wen’s Group has also disclosed that it will take “going overseas” as an important strategic direction and set up a dedicated exploration team to advance related work. Relying on years of overseas experience and channel resources in businesses such as animal healthcare, agricultural and livestock equipment, and environmental protection, the company will prioritize pushing its broiler chicken business overseas. Its first stop is Vietnam, a country adjacent to China. The initial target is to capture about 10% of the Vietnamese broiler chicken market. Subsequently, depending on overseas development, it will gradually expand into other businesses such as pig and duck industries, and deeply tap the potential for growth in international markets.

“Currently, overseas livestock markets still have significant room for development. In recent years, domestic companies have built relatively strong competitive advantages, strengthened cost-control capabilities on the production side, and therefore have opportunities and capability to export technology.” When discussing its development plan, the above-mentioned executive from Wen’s Group said that in 2026 the company will continue to focus on internal production and operations, continuously improve production efficiency, and strengthen internal management and operational optimization. The company is confident and capable of successfully getting through this round of low-spirited cycle and achieving new development.

The above-mentioned executive from New Hope also said that currently the company’s breeding farms cover 116 cities across 25 provinces nationwide, completing fixed-asset capacity placement. Going forward, the company will dynamically adjust its breeding layout of biological assets—based on factors such as production costs and disease prevention and control in each region. For example, in the western and south China regions, breeding costs are relatively lower, so the company’s deployment preference for biological assets will tilt toward these areas to improve slaughter output share. While keeping the free-range model broadly stable, in the future the company will gradually increase the quantity and share of internally bred-to-fattened hog sales; by rigorously tightening production management, it will continuously reduce hog-raising costs.

（Source: Securities Times）