Why is China Cracking Down on ‘Pig Fattening’ and Aiming for ‘Slim’ Pigs?

China Cracks Down on ‘Reweighing’ Pigs: Unraveling the Strategy

In recent times, many small farmers and businesses in China have been purchasing mature pigs from large farms, subsequently rearing them for a few additional months to increase their weight by 40-50 kg. This practice, known as “reweighting,” is done with the expectation that pork prices will rise, presenting an opportunity for profits.

However, the Chinese government is concerned that such speculation leads to market instability, with temporary shortages and surpluses causing significant price fluctuations.

Moreover, reweighing results in considerable waste of animal feed, contradicting the national strategy of grain conservation and reducing reliance on imports, especially amid trade tensions with the US.

According to Pan Chenjun, an expert from Rabobank, the Chinese government is determined to stabilize weak pork prices while curbing speculation and protecting small pig farmers.

China, the world’s largest consumer of pork, is grappling with weak demand and a supply glut that erodes profit margins.

What specific actions is China taking?

In late May, Muyuan Foods, China’s largest pig producer, announced it had stopped selling pigs to reweighing operations following rumors of a policy meeting aimed at curbing this practice.

According to Reuters, the crackdown has commenced and is being rigorously enforced in certain regions, particularly Guangdong province. Some sources indicate that the National Development and Reform Commission of China is involved in the supervision.

Although there has been no official declaration from the government, the actions of large enterprises and local authorities demonstrate the seriousness of quashing pork speculation.

This is not merely about market management but also part of China’s long-term strategy to control its food supply chain and reduce risks from international fluctuations.

Currently, China, the world’s largest consumer of pork, faces a challenging equation of weak demand, excess supply, and eroding profit margins.

Pork prices have plummeted from a peak of 21 RMB/kg last August to approximately 14 RMB/kg since February this year.

In this context, reweighing pigs and waiting for prices to rise exacerbates the surplus situation when these batches of pigs flood the market simultaneously.

According to Lin Guofa, an expert from the agricultural consulting firm Bric, a 150 kg pig can yield over 42% more meat than a 115 kg pig, abruptly increasing supply and further depressing prices.

How does ‘Reweighing’ affect feed resources?

Raising overly large pigs not only disrupts the market but also reduces the efficiency of feed utilization, a critical issue as China aims to decrease the amount of grain used in this industry.

Trade tensions with the US have also motivated China to lessen its reliance on imported soybeans, a primary ingredient in pig feed.

According to Pan, pigs reaching approximately 120 kg represent the optimal feed conversion stage; beyond this point, pigs consume more feed but gain less weight, resulting in diminished economic efficiency.

Thus, raising oversized pigs not only distorts the balance of meat supply but also wastes resources, especially as China promotes its “domestic food security” strategy.

For small farming households, the restriction on reweighing means losing a speculative opportunity that was once considered profitable. However, in the long run, this policy may shield them from risks when market conditions shift.

The Chinese government appears intent on stabilizing the pork market and making it more predictable, enabling farmers to produce with confidence instead of speculating.

For large enterprises like Muyuan Foods, halting sales to speculators can enhance supply chain control and prevent entanglement in price fluctuations.

If executed effectively, the strategy of reducing speculation and improving farming efficiency will significantly contribute to the sustainable development of China’s agricultural sector.