August 27, 2019

China's Muyuan sees increased first-half losses

Muyuan Foods, China's second-biggest pig producer, has reported an increase in first-half losses from last year due to declining pig prices in the first quarter and rising costs in keeping its farms free from African swine fever.

For the first six months of 2019, Muyuan reported a net loss of ¥155.7 million (US$21.95 million) compared with a loss of ¥78.7 million (US$11 million) a year earlier. Revenue rose 29.9% to  ¥7.16 billion (US$1 billion) from the same period in 2018 after the company added new farms.

Pig prices in the first quarter of 2019 were relatively low, said Muyuan, after panic slaughtering by farmers increased market supplies even as transport bans designed to stop the spread of disease prevented some supplies moving to market.

The company has also continued to upgrade biosecurity on its farms and strengthened management to protect against the spread of African swine fever.

China has reported more than 140 cases of African swine fever across the country since it was first detected a year ago but many more cases go unreported.

Live hog prices began rising nationwide in June, hitting a record this month on a shortage of supplies.

Muyuan sold 5.8 million hogs in the first six months of 2019 compared with 4.7 million in the same period last year.

- Reuters