The chairman of New Hope Group, one of China's biggest pig breeders, said on Monday he is "optimistic" hog prices will pull out of a multi-year slump this year as government policies to stimulate the market take effect, reported Reuters.

Liu Yonghao said a shift towards bigger producers that drove pig supply higher and pork prices down have meant the market was taking longer than usual to recover from its latest downturn.

Large hog enterprises have elbowed their way into the sector in recent years and prioritised growth and market share over profits, creating a surplus.

Slowing demand has added to pressure on farms struggling with heavy losses and mounting debts to slim down their breeding herds and sell off farms.

Pork prices have been at a bottom for nearly three years, Liu told reporters on the sidelines of Chinese People’s Political Consultative Conference. "Companies have invested a lot of money and are unwilling to give up," he said.

A mismatch between an acceleration in production capacity and slow consumption growth have helped prolong the downturn, he said.

But Liu said pork consumption is set to increase as the economy and consumer confidence develops with supportive government policies.

"I am still optimistic. I believe that after nearly three consecutive years of lows, the possibility of another three years is very small, and the probability of going up is higher," he added.

China has unveiled new regulations to control the nation's expanded pig production capacity, lowering the national target for normal retention of breeding sows to 39 million from 41 million in a move that could dent the size of the world's largest pig herd.