January 16, 2024

 

The performance of listed Chinese pig companies in H1 2023

An eFeedLink Exclusive

 

Nineteen listed pig companies in China sold a total of 73.78 million pigs in the first half of 2023, of which Muyuan ranked first with 30.265 million pigs released, semi-annual performance reports revealed.

 

Overall, 17 of them incurred losses. Two companies that made a profit had their main business rooted in other industries, with pig farming accounting for a small proportion of their revenue. For example, Haid Group is mainly a feed producer, with its feed sales accounting for 88.74% of its business.

 

In total, the three biggest hog producers suffered a combined loss of ¥10.451 billion (US$1.4 billion) in H1 2023.

 

Muyuan achieved a total operating income of ¥51.869 billion (US$7.1 billion), a year-on-year increase of 17.17%.

 

Wen's achieved an operating income of ¥41.189 billion (US$5.6 million), higher by 30.61% year-on-year. It stated that during the reporting period, both the pig and yellow-feathered chicken industries were at the trough of market cycles, resulting in losses amid weak prices of pigs and broilers and high production costs.

 

Meanwhile, in H1 2023, New Hope achieved an operating income of ¥69.453 billion (US$9.5 billion), an 11.43% increase year-on-year.

 

Despite having suffered losses for eight consecutive months, most listed pig companies have not slowed the pace of expansion. For instance, Wen's stated that the company's production capacity had increased steadily in accordance with its plan at the start of 2023. As of the end of May, the company has more than 1.45 million conceivable sows and about 600,000 gilts.

 

At the end of H1 2023, New Hope's non-production days for sows dropped to 32 days, three days shorter than in Q4 2022. The average number of weaned pigs per litter increased to 10.8, an increase of 0.4 from Q4 2022. Per sow yield reached more than 23 pigs. Weaning costs fell to about ¥370/head (US$50.65), a decrease of ¥30/head (US$4.12) from Q4 2022. The survival rate of fattening pigs was close to 90%. New Hope’s feed-to-meat ratio dropped to 2.74, a decrease of 0.13 from Q4 2022.

 

Muyuan's total cost of pig production dropped significantly in H1 2023. In mid-June 2023, Muyuan's pig production cost dropped to ¥14.9/kg (US$2.04). Additionally, it reported that an improvement in production performance contributed about ¥0.2/kg (US$0.03). A decrease in feed cost contributed about ¥0.1/kg (US$0.01). Lower expenses during the period contributed about ¥0.1/kg.

 

- David Lin, eFeedLink