In a challenging downturn for the industry, the A$200-billion pork production leader, MUYUAN, finds itself in a difficult position where increasing sales volumes are correlating with deeper losses.
According to the company's latest earnings forecast, for the first half of this year, MUYUAN expects its net profit attributable to shareholders to swing from a profit of A$10.53 billion in the same period last year to a loss ranging between A$5.7 billion and A$6.7 billion, representing a year-on-year decline of 154.14% to 163.63%.
MUYUAN stated that despite reducing its hog farming costs through enhanced management capabilities, the company's performance turned to a loss in the first half due to a significant drop in hog prices.
Separate sales data shows that in the first six months of the year, the company sold a cumulative 38.615 million commercial hogs, a slight increase of 0.58% year-on-year. However, cumulative sales revenue plummeted by nearly 30% to A$50.145 billion, down from A$70.868 billion in the same period last year.
Despite the pressure on its core farming operations, MUYUAN's slaughtering and meat processing business has continued to be profitable. Qin Muyuan, CEO of Muyuan Meat, revealed that the company's slaughtering and meat segment was profitable in both the first and second quarters of this year.
It is worth noting that shortly before this earnings forecast was released, MUYUAN underwent a leadership transition. Founder Qin Yinglin resigned from his positions as director, chairman, and president upon reaching the mandatory retirement age. Veteran executive Cao Zhinian has taken over as the new chairman.
Beyond the financial pressure, MUYUAN recently faced renewed controversy over its internal publication, "Ode to the Pig." In response, the company stated that the piece represents an existing cultural value output and welcomes public discussion based on a full understanding of its context.
Notably, in the recently unveiled "2026 New Fortune 500 Richest List," Qin Yinglin and his wife Qian Ying, the actual controllers of MUYUAN, once again made the list with a fortune of A$151.72 billion.
Deepening Losses Despite High Sales Volume
On July 10th, MUYUAN released its first-half earnings forecast, projecting a net loss attributable to shareholders of A$5.7 to A$6.7 billion, a sharp reversal from the A$10.53 billion profit in the first half of the previous year.
Basic earnings per share are also expected to fall from a profit of A$1.96 per share last year to a loss of between A$1.03 and A$1.21 per share.
The company attributed the loss primarily to a substantial year-on-year decline in hog sales prices, with the average commercial hog price at approximately A$1.04 per kilogram, down about 28%. This occurred despite the company successfully lowering its hog farming costs through refined management practices.
Sales data for June shows a consistent downward trend in commercial hog prices since January, falling from A$1.257 per kg in January to A$0.969 per kg in June.
Although the company disclosed that its full hog farming cost was controlled at around A$1.17 per kg in June, this still exceeded the average selling price by approximately A$0.201 per kg, leading to a situation where greater sales volumes result in larger losses.
MUYUAN warned in its forecast that if hog market prices experience a significant decline in the future, the company's performance could continue to deteriorate.
However, reports indicate that domestic hog prices have rebounded sharply since late June. As of July 9th, the price for ternary hybrid hogs had risen to A$1.133 per kg, an increase of 18.89% from June 28th.
Securities firms hold differing views on future price trends. Some analysts suggest that based on production capacity cycles and a significant decline in newborn piglet numbers since the beginning of the year, hog prices may begin a sustained upward trend starting in the third quarter. They believe the recent rebound could develop into a more enduring reversal.
Other analysts project that as secondary breeding inventories increase, hog prices may retreat. Based on breeding sow inventory projections, a cumulative reduction of 3.4% in capacity from July 2025 to March 2026 could lead to a renewed price increase channel in the second half of 2026, though prices may remain subdued for an extended period.
This first-half loss report also represents the first major test for the company's new chairman, Cao Zhinian.
In early June, the company announced the management change. Following his resignation, founder Qin Yinglin will serve as the head of the Muyuan Pig Farming Research Institute to continue driving technological innovation in the industry.
Concurrently, the board elected Cao Zhinian as chairman and appointed Gao Tong as president and chief financial officer.
Profitable Slaughter Business Provides a Buffer
Against the backdrop of pressure on its hog farming operations, the sustained profitability of the slaughtering and meat processing business has been a highlight for MUYUAN in the first half.
The CEO of Muyuan Meat stated that the slaughtering segment remained profitable in both Q1 and Q2 this year, continuing the profitable trend from 2025. He noted that the proportion of self-slaughtered hogs is still relatively low, indicating room for future profit growth in this segment, with slaughter volume expected to grow by 20% this year.
MUYUAN began expanding into slaughtering and meat processing in 2019, aligning with national policy encouraging local slaughtering. The company started constructing slaughterhouses to adapt to the industry shift from transporting live hogs to transporting meat.
By the end of 2020, the company had established 15 slaughtering subsidiaries nationwide with a planned annual capacity of approximately 40 million head, while simultaneously building a national fresh pork sales network.
From 2021 to 2024, the company accelerated the construction of slaughtering capacity in its main farming regions. Slaughter volume increased from 2.899 million head in 2021 to 12.5244 million head in 2024, with revenue from this segment jumping from A$5.42 billion to A$24.274 billion.
However, in 2024, this segment contributed only 19.72% of total revenue with a gross margin of just 1.03%, indicating a relatively small contribution to overall performance at that time.
In a positive development, the slaughtering and meat business achieved its first annual profit in 2025. For the full year 2025, the company slaughtered 28.663 million hogs, a 129% increase year-on-year, with a capacity utilization rate of 98.8%, generating revenue of A$45.228 billion, up 86.32% year-on-year.
For the current year, the company plans to accelerate the construction of slaughterhouses and processing centers, while also optimizing sales channels and product mix, including increasing the proportion of processed cuts.
Analysis suggests that the continued profitability of the slaughtering business in the first half provides a crucial profit buffer, helping to mitigate the cyclical volatility of the farming business.
Company Addresses Controversy Over Internal Publication
Amidst the significant financial loss, MUYUAN recently found itself in the spotlight again due to controversy surrounding its internal publication, "Ode to the Pig," written by founder Qin Yinglin.
The approximately 800-word article describes the contributions of pigs to humanity, with phrases like "we are also willing, like pigs, to calmly dedicate everything we have" sparking heated online discussion.
Some netizens questioned whether the article promoted "unconditional employee sacrifice" and likened it to workplace psychological pressure, arguing that comparing employees to pigs that dedicate their lives is inconsistent with modern workplace culture.
Others defended the sentiment, stating that just as farmers revere the land and fishermen revere the seas, it is natural for those in animal husbandry to revere pigs, and this sincere industry sentiment should not be stigmatized.
As the debate continued, a company representative clarified to media that "Ode to the Pig" is not a new document but internal training material and cultural content drafted in 2012, which has been publicly available on the company website, cultural walls, and during external visits for over a decade.
The representative emphasized that the article is not about demanding employees sacrifice themselves without compensation, but rather advocates for creating value to serve society, which is the company's core value.
The article remains published on the company's official website. A note appended to it explains that it was written in 2012 based on two decades of pig farming experience, intended to remind the company to respect the profession. It draws lessons from pig behavior about not seeking undue gain in business but creating real value through solid capability.
The note further states that creating value and serving society guide employees to focus less on calculation and more on contribution, helping clients succeed and promoting social progress.
Regarding the controversy, the company stated it welcomes objective public discussion based on a full understanding of the cultural context.
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