China’s Bid to Improve Food Production? Giant Towers of Pigs.
By Daisuke Wakabayashi and Claire Fu, Feb. 8, 2023, NY Times

The building, on the outskirts of Ezhou, a city on the southern bank of the Yangtze River, is hailed as the world’s biggest free-standing pig farm, with a second, identical hog high-rise opening soon. The first farm started operating in October, and
once both buildings reach full capacity this year, it is expected to raise 1.2 million pigs annually.

China has had a long love affair with pigs. For decades, many rural Chinese households raised backyard pigs, considered valuable livestock as a source of not only meat but also manure. Pigs also hold cultural significance as a symbol of prosperity
because, historically, pork was served only on special occasions.

Today, no country eats more pork than China, which consumes half the world’s pig meat. Pork prices are closely watched as a measure of inflation and carefully managed through the country’s strategic pork reserve — a government meat stockpile that
can stabilize prices when supplies run low.

But pork prices are higher than in other major nations where pig farming went industrial a long time ago. In the last few years, dozens of other mammoth industrialized pig farms have sprung up across China as part of Beijing’s drive to close that gap.

Built by Hubei Zhongxin Kaiwei Modern Animal Husbandry, a cement manufacturer turned pig breeder, the Ezhou farm stands like a monument to China’s ambition to modernize pork production.

“China’s current pig breeding is still decades behind the most advanced nations,” said Zhuge Wenda, the company’s president. “This provides us with room for improvement to catch up.”

The farm is next to the company’s cement factory, in a region known as the “Land of Fish and Rice” for its importance to Chinese cuisine with its fertile farmlands and surrounding bodies of water.

A pig farm in name, the operation is more like a Foxconn factory for pigs with the precision required of an iPhone production line. Even pig feces are measured, collected and repurposed. Roughly one-quarter of the feed will come out as dry excrement that
can be repurposed as methane to generate electricity.

Six decades after a famine killed tens of millions of its people, China still trails most of the developed world when it comes to efficient food production. China is the biggest importer of agricultural goods, including more than half the world’s
soybeans, mostly for animal feed. It has about 10 percent of the planet’s arable land for around 20 percent of the global population. Its crops cost more to produce, and its farmlands yield less corn, wheat and soybean per acre than other major
economies.

The shortcomings became more pronounced in the last few years when trade disputes with the United States, pandemic-related supply disruptions and the war in Ukraine underscored China’s potential food security risk. In a December policy address, Xi
Jinping, China’s leader, called agricultural self-reliance a priority.

“A country must strengthen its agriculture before making itself a great power, and only a robust agriculture can make the country strong,” Mr. Xi said. In the past, he has warned that China would “fall under others’ control if we don’t hold our
rice bowl steady.”

And no protein is more important for the Chinese rice bowl than pork. The State Council, China’s cabinet, issued a decree in 2019 stating that all government departments needed to support the pork industry, including financial aid for more large-scale
pig farms. In the same year, Beijing also said it would approve multistory farming, which allowed pig farming to go vertical to raise more hogs on relatively smaller parcels.

“This is a milestone and not only for China, because I think multistory farms will have an impact on the world,” said Yu Ping, executive director of Yu’s Design Institute, a company that designs pig farms.

As China has modernized with hundreds of millions of people moving from the countryside to urban centers, small backyard farms have disappeared. The number of pig farms in China producing fewer than 500 hogs a year plunged 75 percent from 2007 to 2020,
to around 21 million, according to an industry report.

The shift toward megafarms accelerated in 2018 when African swine fever ravaged China’s pork industry and wiped out, by some estimates, 40 percent of its pig population.

Brett Stuart, founder of Global AgriTrends, a market research firm, said hog towers and other giant pig farms exacerbated the biggest risk facing China’s pork industry: disease. Raising so many pigs together in a single facility makes it harder to
prevent contamination. He said large U.S. pork producers spread out their farms to reduce biosecurity risk.

“U.S. hog farmers look at the pictures of those farms in China, and they just scratch their heads and say, ‘We would never dare do that,’” Mr. Stuart said. “It’s just too risky.”

But when pork prices tripled in a year, coupled with Beijing’s support of large-scale pig farms, the rewards appeared to outweigh the risk. A building boom ensued, and a market constrained by supply became overwhelmed with available pigs. Pork prices
are down roughly 60 percent from 2019 highs. China’s pork industry is marked by Bitcoin-like volatility, riding boom-or-bust cycles that spin off huge profits or losses depending on the wild price swings.

Last month, Jiangxi Zhengbang Technology, a giant hog producer that has expanded rapidly in the last few years, said it had been warned that it may be delisted from the Shenzhen Stock Exchange over concerns that the company is insolvent.

“The hope from the government is that consolidation will make prices more predictable and less volatile over time,” said Pan Chenjun, executive director at RaboResearch’s food and agriculture division. “That’s the ultimate goal.”

In rural villages, where backyard farms once dotted the countryside, megafarms are sprouting up. Three years ago, as property and infrastructure sectors started to slump, Hubei Zhongxin Kaiwei decided to use a neighboring plot and apply its construction
expertise to branch out into a business with better growth prospects. It invested $600 million to build the high-rise pig farms with an additional $900 million earmarked for a nearby meat processing plant.

Its background in cement is useful in pig farming, the company said. Using its existing employees, it built a land-saving high-rise with reinforced concrete. It is using excess heat from the cement factory to provide hot baths and warm drinking water to
the pigs. This, according to Hubei Zhongxin Kaiwei, will help the pigs grow faster with less feed.

Small backyard pig farmers are finding it hard to keep pace with that type of scale.

Qiao Yuping, 66, raises about 20 to 30 pigs a year with her husband in Liaoning Province in northeastern China. When pork prices fell last year, she said, they didn’t make any money. She said it was hard to ignore the impact of megafarms that drove up
feed and vaccine prices for the animals.

“Everything has gone up in price,” Ms. Qiao said. “How can we not be affected?

https://www.nytimes.com/2023/02/08/business/china-pork-farms.html

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