A new policy has been welcomed by pig farmers in Sichuan. On April 15, Deng Shuangqiong, the head of a farming cooperative in Peng'an County, expressed relief upon learning that subsidies would be available for sows raised on farms with an annual output of over 500 pigs.
Recently, the provincial government released a package of measures aimed at stabilizing and improving the economy. Among the industrial policies are incentives for scaling up pig farming, stabilizing production capacity, and enhancing pork processing. A single enterprise can receive up to 8 million yuan in support.
Sichuan is a major pig-producing province in China. The industry is currently experiencing an unusually long cycle, with prices hitting an 8-year low, widespread losses across the sector, and a significant mismatch between supply and demand. The new policy package is designed to help farmers weather the difficult period while guiding the industry toward higher-quality development.
Many farmers are struggling. Huang Kai, a farm manager in Xingwen County, recently sold over 300 piglets for only 100 yuan each, half the previous price. With market prices for finished pigs persistently low, selling a market-ready hog now results in a loss. Farmers like Deng Shuangqiong are also facing negative margins, as feed and other costs outstrip the revenue from selling pigs.
According to official data, the national average pig price has fallen significantly year-on-year. The pig-to-grain ratio, a key indicator of profitability, has also dropped to a record low, far below the warning level.
The entire industry has been losing money since the last quarter of the previous year. Major companies involved in pig farming reported losses in the first quarter.
Industry insiders see the new policy as timely support. Large-scale farms are the mainstay of pig production, and increasing the scale of operations is a necessary trend for modernizing the industry. The measures aim to improve the scale, efficiency, and risk resilience of pig farming in Sichuan.
The policy direction emphasizes modernization and quality over mere expansion. This aligns with national efforts to support equipment upgrades and technological improvements in livestock farming, rather than encouraging increased production capacity.
An expert from Sichuan Agricultural University noted that the policy also encourages investment in advanced pork processing. Developing deeper processing capabilities can help companies generate higher returns even when live pig prices are low. However, expanding into processing requires strong corporate resources and cash flow, and companies should choose integration models suited to their capabilities.
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