The USDA's post in China has revised swine production in 2024 to 695 million head with a year-on-year decline of 3% due to a lower sow inventory in 2024 compared to 2023. Herd liquidation as a result of low swine and pork prices and lingering animal diseases in 2023 are the two major reasons for the lower sow inventory, according to a recent US Department of Agriculture (USDA) Global Agricultural Information Network (GAIN) report.

Swine producers started to expand swine production to rebuild their herds in 2020 and 2021 when African swine fever (ASF) outbreaks severely hurt the industry. The negative impacts of the large expansion of China’s swineherd manifested in 2023 when swine production exceeded market demand. Average swine prices remained low through 2023, causing losses across the swine breeding industry. According to the National Development and Reform Commission, except for some slight profits from August to September, producers operated at a loss for most of 2023. The Ministry of Agricultural and Rural Affairs (MARA) indicated it was the first year since 2014 that swine producers suffered such large losses.

Industry sources reported that ASF continued affecting the sector in 2023 especially in North China. The losses for producers and news of an ASF resurgence contributed to “panic” sales resulting in a reduction of inefficient sows. The National Bureau of Statistics (NBS) reported that the sow inventory had declined to 41.42 million at the end of 2023. 

The USDA post forecasts swine production will decline in 2024. With fewer inefficient sows, the piglets weaned per sow per year has improved. However, this improvement is unlikely to offset the lower average sow inventory in 2023. More small- and medium-sized producers exited the market due to inadequate cash flows and challenges in obtaining loans. With less swine production from smaller producers, NBS estimates the share of large-scale swine producers versus small- to mid-sized producers exceed 68% in 2023, with a year-on-year increase of about 3%.

Post revised the 2023 swine production estimate up 1% from 2022. Although there’s no official data available for swine production, swine feed production witnessed year-on-year growth of over 10%
according to the China Feed Industry Association. Nevertheless, post projects swine production growth lower because Chinese feed production statistics only include production of commercial feed, which is used by large-scale producers. The shift from small-sized producers to larger-sized producers will lead to higher demand of compound feed without necessarily increasing production at the same rate.