Pig prices hit a six-year low, Muyuan Foods' net profit declines

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Source: Shenzhen Commercial Daily

On March 27, Muyuan Co., Ltd. released its annual report. In 2025, the company achieved operating revenue of RMB 144.145 billion, up 4.49% year over year; net profit attributable to shareholders of listed companies was RMB 15.487 billion, down 13.39% year over year.

Looking at a longer time horizon, after the company posted a massive loss of RMB 4.263 billion in 2023, followed by a more than fivefold surge in profit to RMB 17.881 billion in 2024, its performance dropped again.

As an industry giant whose main businesses are hog farming and slaughter, Muyuan Co., Ltd.’s main products include market hogs, piglets, breeding pigs, as well as pork carcasses, portioned products, and by-products. In 2025, through the efficient transformation of technological achievements into actual productive capacity, the stability of its hog farming operations improved significantly. The hog survival rate and various indicators rose steadily, while costs fell significantly. In full-year 2025, the fully allocated cost of hog farming was about RMB 12 per kilogram, about RMB 2 per kilogram lower than the same period last year.

However, optimizing costs was not enough to offset the shock from falling market prices. The annual report states that the core reason for the decline in net profit in 2025 was the drop in hog prices. The average annual price of live hogs fell to RMB 14.44 per kilogram, the lowest level since 2019. During the reporting period, the company sold 77.981 million market hogs, slaughtered 28.663 million hogs, and sold pork products such as fresh and frozen meat totaling 3.23 million tons.

According to the announcement, in 2025 the hog price followed a “high at the front and low afterward, with declining oscillations” trend, with the overall fluctuation range narrowing markedly. By quarter, in the first quarter prices were at the high level for the year, and the industry continued the profitability situation that has persisted since the second half of 2024; in the second quarter supply pressure gradually emerged, and the industry was in a barely profitable state; in the third quarter the decline accelerated, and the industry began to enter a loss state; in the fourth quarter the search for a bottom accelerated, with the mid-October period as the year’s low point, followed by a slight rebound toward year-end.

Entering 2026, Muyuan Co., Ltd.’s sales average price and revenue side still have not shown improvement. This year January, the company’s average sales price for market hogs was RMB 12.57 per kilogram, down 16.92% year over year, and it generated sales revenue of RMB 10.566 billion, down 11.93% year over year. February data faced further pressure: sales of market hogs were 4.603 million head, down slightly by 0.77% year over year; the average sales price fell to RMB 11.59 per kilogram, with the year-over-year decline widening to 18.72%; and monthly sales revenue was RMB 6.405 billion, down 23.98% year over year.

Apart from the cyclical fluctuations in the market price of market hogs, Muyuan Co., Ltd. also candidly acknowledged potential risks arising from raw material price volatility in its announcement. The company stated that in recent years, the combined cost of major raw materials such as wheat, corn, and soybean meal accounted for about 55%-65% of operating cost. Fluctuations in the prices of the above bulk agricultural commodities will have a major impact on the company’s main business costs and net profit.

Of note is that in 2025, while deepening its domestic business, Muyuan Co., Ltd. actively tracked and expanded overseas markets. It set up Muyuan Vietnam Co., Ltd., and signed a cooperation agreement with Vietnam’s BAF Company. During the reporting period, the company submitted an application for issuing and listing overseas listed foreign-invested shares (H shares), and completed the listing on the Hong Kong Stock Exchange in February 2026.

As of the close on March 27, Muyuan Co., Ltd.’s A shares were quoted at RMB 45.20 per share, and the company’s total market capitalization was RMB 260.9 billion.

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