Flush with cash, Chinese hog producer builds world’s largest pig farm

Behind the walls of a hulking industrial compound in rural China, top pig producer Muyuan Foods is trying to raise more hogs on a single site than any company in the world – a risky investment with deadly African swine fever lingering.

The new farm, which began construction in March and started operations at the first of its 21 buildings in September, epitomises the breakneck pace at which huge, industrialised hog breeding facilities are replacing small, traditional farms, many of which were wiped out by the worst animal disease outbreak in recent history.

The shift, under way for years, has accelerated sharply, fuelled by huge profits at corporate producers since African swine fever ravaged the country’s herd and sent pig prices soaring to double the previous record.

Corporate farms weren’t spared by the epidemic, but as prices jumped, they quickly recouped their losses. Muyuan’s profits grew 1,413% in the first nine months of 2020 to 21 billion yuan ($3.21 billion).

“We have hit a very favourable period for development. Pig prices are very high, our profits are really good, and cash flow is really ample,” Qin Jun, Muyuan’s vice general manager, told Reuters at the company’s headquarters in Nanyang city in central China.

In the race to take share, companies like Muyuan are designing higher-density automated farms, betting they can keep disease out while increasing efficiency to satisfy the country’s huge appetite for pork.

Muyuan’s new mega farm near Nanyang, which will eventually house 84,000 sows and their offspring, is by far the largest in the world, roughly 10 times the size of a typical breeding facility in the United States. It aims to produce around 2.1 million pigs a year.

If it works as planned – and other producers follow suit – the world’s top pork consumer could reduce purchases from the global market, upending a booming meat trade that has supported farmers across the world.

Reuters

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