China’s Biggest Deflation Nightmare! $0.70/lb Pork, $1 Big Crabs Leave Farmers Drowning in Losses

When I see these pigs, I think about how all my hard work brought me all this suffering. It almost makes me laugh, but I'm afraid to laugh too loudly in case heavens think I still haven't learned my lesson. I've learned it now. The new year will be here before prices rise. Don't panic, they say. You only have a few pigs. The more you own, the worse it feels. I still have more than 790 hogs. I've put it in over 1.4 million yuan and the average weight is already over 330 pounds. Forget profit or loss for a moment. I bought them at about 4.9 yuan a pound. First, work out what price I need to break even. These price drops over the last couple of days are making everyone nervous and they're still falling. Here, standard market weight hogs are back to about 4.5 to 4.6 yuan a pound. But making money is never easy. If I want to earn money, I have to accept the risk. I've already stocked all the feed. I'm keeping them until they reach about 420 pounds. I'm determined to see this through. One person commented, the more we raise, the lower prices go. The lower prices go, the more we raise. It's like everyone leaving early to beat holiday traffic and all getting stuck together. Lower prices just bring in more farmers. This could go on a long time. Even 1.81 yuan a pound is possible. Fine, let's all go down together. Keep doubling down. It's a matter of pride now. I've expanded anyway and added another row of pig barns on the hillside. Another row. I don't even dare tell people I raise pigs anymore. They'll know I'm losing money. Hogs are selling for 4.35 yuan a pound today. How's everyone doing? Haha, prices have fallen below 4.54 yuan across the board again. A lot of friends in manufacturing complain that they invest millions or even tens of millions of yuan in factories and equipment, only to earn a few cents in profit on each product. In hog farming, even making a profit feels out of reach. Look at this place. We've invested millions of yuan, and just breaking even would be good. If African swine fever hits, we could lose our entire investment. Live hog prices in China recently fell below 4.54 yuan a pound. Hog futures have dropped 23% over the past 4 plus months. It is still unclear when prices will bottom out. At these prices, the strain extends beyond farmers. Suppliers and other businesses that depend on hog farms are also struggling to stay afloat. One person in the industry wrote in the comments, I haul feed to hog farms. I make more than 40 trips a month and earn 2,200 yuan in profit. I still have to pay over 700 yuan in taxes. Even selling my truck wouldn't cover the loan. hog prices are around 4.54 yuan a pound or a little less take a look at our pigs everyone watching help me decide whether to sell or keep holding on i think every hog farmer feels the same way right now torn and stressed out selling means losing money after more than half a year of hard work we'd end up with no earnings and loss but keeping them is even more stressful They eat more and produce more manure every day. Paying for corn and feed is putting enormous pressure on us. Our costs work out to about 5.17 to 5.26 yuan a pound, but hogs sell for only around 4 yuan a pound. Every pig we sell loses money. Selling locks in a loss. Holding on burns more cash. We're stuck either way. This year, it feels like the harder you work and the more you try, the more likely you are to fail. Meanwhile, people who cut corners seem to avoid losses and make a fortune. People offered advice in the comments. Rather, I raise livestock too. After hearing this, I'd sell. Just think about how much feed they eat each day. These aren't piglets that still have room to grow. Yours are already fully grown. You keep feeding them and working yourself to exhaustion, but the numbers still show a loss. You need to cut your losses. Even if prices rise a little later, that won't cover the feed and labor, and you'll still be exhausted. Another person wrote, some costs shouldn't guide major decisions. You don't have to quit, but you should scale back. Keep some sows to breed piglets and sell the rest. If you disagree, think about how likely prices are to rise this year. But some farmers refuse to lock in losses at these prices. They are keeping their hogs longer, betting on the rebound. Farmers' losses reflect more than a normal price cycle. Both supply and demand are worsening at the same time. A manager overseeing hog fattening at a 10,000-head farm in Guangdong said piglet prices remain weak because supply still exceeds demand. Some farmers who can no longer hold on are selling their hogs and leaving the business. Goodbye. We are clearing out the farm today. After more than 10 days of selling, it's finally over. Finally, struggling through this day after day wears you down. Forget the price rebound. Even at 4.63 yuan a pound, we still lose money. Today's price is about 4.63 to 4.72 yuan a pound. These increases still leave us in the red. Hardly any contract growers can make money. Depending on the settlement rules, they might pay you 140 or 150 yuan, 160 or 170, or 170 or 180. There's always some reason. Some people ask whether we can make money in the future. Personally, I think next year might offer a chance. Piglets are cheap now, at a little over 100 yuan each. If conditions improve across the industry, it might be worth going ahead. At today's costs, I estimate a selling price of about 1.72 yuan a pound should cover costs. Around that level, nobody can say for sure, because we can't predict how many pigs will die. One person wrote, Clearing them out and spare yourself the worry. At these prices, this year looks finished. Who knows what next year will bring. Hog traders now say farmers won't have a future unless the pig groups go under. At the end of the second quarter of 2026, China still had about 37.8 million breeding sows, a relatively high level. Hog production takes several months or longer to respond to changes. Even after farmers reduce sow numbers, hogs already in the production pipeline keep reaching the market. Fewer sows do not immediately mean less pork. Demand is shrinking too. Data show that household pork consumption per person in China fell from about 67 pounds in 2023 to 59 pounds in 2025, down 12.8% over two years. Farmers are still working through earlier overproduction, while consumers have already cut back. This year, hog prices have weakened even as cattle prices rise. Different meats are falling in separate supply and demand cycles. A broader recovery in meat consumption alone can no longer support hog prices. Hog prices have entered a deflationary cycle. Supply remains high and demand cannot absorb it, so prices keep falling. Even when farmers reduce sow numbers, It takes several months for fewer hogs to reach market. Until then, earlier production continues adding to supply. Some industry insiders believe China's sustainable breeding sow population may need to fall sharply to around 20 million. If that assessment is close to reality, this is more than the normal hog price cycle. Oversupply and weakening demand are forcing the entire industry to shrink. That downsizing is already showing up at leading companies. Mu Yuan Foods has long been viewed as China's top hog producer. Its operations span breeding, hog farming, slaughtering, and meat processing. It is known for large-scale operations and strong cost control. Even Mu Yuan is struggling. It has cut its breeding sow herd to 2.97 million, and the turnaround in hog prices may have to wait until next year. The latest report says it sold 6.42 million hogs in September. at an average of 1,326 yuan each, against costs of about 1,470 yuan. That's a loss of roughly 140 yuan per hog. Worse still, Mu Yuan lost 6.078 billion yuan in the first half, including 4.863 billion yuan in the second quarter alone. Costs fell 18%, but hog prices dropped 44%. Prices are falling faster than costs. Mu Yuan is trying to protect itself. It has reduced its breeding sow herd to 2.97 million, cut production, and used its slaughtering business to offset losses. Its costs are already the lowest in the industry, but the industry has been losing money for about 11 straight months. My assessment is that prices may have bottomed in the second quarter, but a return to profit depends on hog prices holding above about 5.44 yuan a pound. Market-ready hog numbers may not actually fall until the fourth quarter or the first half of next year. This will be a gradual recovery, not a small quick rebound. Hog farmers need to be ready to keep holding on. Hog prices keep falling, but feeding costs have not followed. Corn and soybean meal are the two main feed ingredients. Soybean meal, in particular, is still significantly more expensive than a year ago. Hog prices are falling, but corn, soybean meal, and wheat bran are getting more expensive. I really can't make sense of this market anymore. Our corn supply has run out. These 70 souls have eaten it all, and we are out of soybean meal too. Look, this is wheat bran from Udeli flower group. The soybean meal is from sea high. Hog farmers were all betting on the market for a while. Things did improve a little, but now prices are falling again. Meanwhile, corn, bran, soybean meal, and prepared feed have all gone up, with hog prices falling. Betting on the end of this year or next year feels risky. It really does. Data from sensors on October 12th puts about soybean meal prices at about 1,545 yuan per 1,000 pounds, up 12.63% from a year earlier. Soybean prices were also up 7.49% that day. Corn was slightly cheaper than a year earlier, but only by about 1%. That was far short of the double-digit drop in hog prices. Every 0.1 yuan drop in hog prices directly reduces farmers' income, but costs for corn, soybean meal, disease prevention, labor, transportation, utilities, and environmental compliance do not disappear when hogs fail to sell. On large farms especially, each pig consumes substantial amounts of feed before reaching market weight. Feed usually accounts for the largest share of production costs. With hog prices below 4.54 yuan a pound, even a small increase in feed prices can quickly wipe out already thin margin. Commodity markets in mid-October show the same mismatch. China's producer price index rose 5% in September from a year earlier, driven by sharp increases in energy and raw material prices. Consumer prices, meanwhile, remain weak. For hog farmers, that means rising input costs and falling sale prices. Feed prices can rise with soybean and vegetable oil prices, overseas purchasing costs, and shipping costs. But weak demand for hogs leaves farmers with no bargaining power. They have to accept lower purchase prices. This squeeze from stubbornly high costs and falling sale prices extends beyond hog farming. Pork is still an everyday staple, but the same deflationary pressure is spreading to holiday spending and gifts. Hairy crabs normally sell best around the mid-autumn festival and the October 1st National Day holiday. This year, their prices have also fallen sharply. Today is October 1st. Hairy crabs just aren't selling. Big and small crabs are going for the same price, and even the big ones won't move. This market is empty. Nobody is buying. Everyone is bringing in stock. Yesterday, we brought in about 3,300 pounds. Today, prices fell by about 2.70 to 4.50 yuan a pound. We lost 10,000 yuan just like that. A person in Guangdong wrote, We used to get hundreds of orders. Now it's only dozens, and half the crabs die. I don't even dare buy more stock. Another person wrote, It's not that nobody wants them. People think they are too expensive. A larger hairy crab can easily cost tens of yuan each. You get a pile of shells and hardly any meat. That money goes further on chicken, pork, fish, shrimp or beef. This year's market is unbelievable. A crab this big sells for 8 yuan. Crabs have gotten cheaper, just 8 yuan each. 8 yuan for one this big, it's hard to run a business at that price. 8 yuan! 8 yuan! Big crabs for 8 yuan! One person wondered what would fall next. First, shine muscat grape prices plunged and mooncakes went unsold. Now hairy crab prices are plunging too. These price drops make life harder for crab farmers. Many face rising production costs and weaker sales at the same time. Unlike factories, crab farms cannot simply stop production when the market weakens. They have already paid to stock, feed and raise the crabs. Once harvest season arrives, unsold stock leaves them with two choices, keep raising the crabs and spending money or sell cheaply and take an immediate loss. Farming costs this year are frighteningly high. Hi everyone, I'm Lao Zhou, a hairy crab farmer in Xinhua. I'm at the farm today. I did a quick comparison of last year's farming costs and this year's current supply costs. The increase is alarming. Let me explain four main factors. First, fish meal has gone up sharply. This year, it costs over 10,400 yuan per 1,000 pounds. Fish meal is the main source of animal protein in our feed. By my rough estimate, our feed costs this year are over 450 yuan more per 1,000 pounds than in previous year. The vlogger added, fish meal has risen so much, and frozen fish has also become much more expensive. Last year, the low-grade fish we bought came in 44-pound blocks. They averaged 50 yuan a block. This year, they're about 80 yuan. Third, their supplemental feed, such as animal organs, chicken liver, and duck liver. Last year, it cost about 910 to 1090 yuan per 1,000 pounds. This year, that's up to about 1,540 yuan. Fourth, stocking density has increased considerably. At large ponds like ours, we used to keep it at 1,600 to 1,800. This year, we are stocking 2,000 or more. That's why farming costs are so high this year. For farmers, the problem is that nearly every cost is rising while sale prices fall. Spending more does not necessarily bring in more money. It may simply deepen losses. Once market conditions worsen, money already invested becomes difficult to recover, and pressure on cash flow quickly grows. Raising crabs in 2026 has been incredibly hard. Juvenile crabs, crab larvae, frozen fish for feed, and duck liver are all getting more expensive. Our investment this year is the highest ever. It starts with stocking. We wanted all-female juvenile crabs, but local supplies in Xinguang were snapped up. Prices reached as high as about 91 yuan a pound. Many of us then considered raising all-male crabs for the early summer market instead. The male juveniles that nobody wanted in previous years rose to about 7.30 to 8.20 yuan a pound. Slightly larger ones were snapped up at over 18 yuan a pound Cost pressure is also affecting quality When the market weakens, farmers first look for ways to reduce further spending The result can be more than lower profits Crab size, meat content, and maturity can all suffer Lower prices discourage further investment Poorer quality then discourages buyers, making a recovery even harder These are the worst, the absolute worst crabs I've eaten this year I bought them at Hangzhou's biggest seafood market I just picked some at random This is the first one Here's the second There's a little inside, but it's basically empty Just this tiny bit of roe I already ate one, and it was really tasteless There was no crab flavour at all I can't believe people in Hangzhou are eating crabs this poor Empty, empty, just a tiny bit of roe The main problem is that they have no crab flavor. That creates a familiar deflationary spiral. Weak demand pushes prices down. Lower prices force producers to spend less. Falling quality then further discourages buyers. Hairy crabs may look cheaper, but farmers, wholesalers, and consumers all lose out. Farmers lose their margins. Sellers are stuck with inventory. And even when consumers pay less, they may no longer get the quality they once did. The problem facing China's economy goes beyond falling prices for a single product. Most industries are experiencing the same deflationary pressure, and everyday life is getting harder.