Has China's Pork Consumption Peaked?

China's pork consumption has reached a plateau, according to a Farmer's Daily article last week. This is the second time State media have broadcast this message in 2022 as officials try to reassure consumers tired of high meat prices and rein in a mostly private-sector pork industry.

The Farmers Daily piece was based on an interview with Zhu Zengyong, a pork industry analyst who is the go-to source for all articles in state-run media on pork. Zhu stressed that pork's share of meat consumption has fallen from 65% to less than 60% in the last decade while poultry has grown to 25-30% and beef and mutton are up to about 15% of meat consumption. He expects steady annual pork consumption at 55-to-56 million tons in the future as population growth offsets a declining trend in per capita consumption. Zhu blamed short-term fluctuations in pork prices on the pandemic, highlighting the closure of cafeterias and intermittent interruptions of pork distribution as factors affecting prices. 

The Farmers Daily reporter claimed to have gathered his information from a recent interview, but it appears to be a summary of an April 2022 article in business publication Yicai, "Consumers’ preference for pork declines, the last thing the hog farming industry wants to see." The Farmers Daily and Yicai articles seem to be the first to discuss pork consumption since the African swine fever crisis induced a pork shortage three years ago. Government orders to "...strengthen the guidance and management of public opinion" during the pork shortage issued in 2019 probably imposed a moratorium on news articles about pork shortages. 

The Yicai article coincided with release of the Ministry of Agriculture and Rural Affairs' (MARA) 10-year projections of agricultural supply and demand. Mr. Zhu presented the pork projections at the Ministry's release meeting in April, but the projections were not mentioned in the article. The projection of pork consumption was essentially flat through 2031, consistent with Zhu's assessment. MARA's projection contrasts with USDA's projections released in February that showed a slower recovery from the African swine fever dip and faster future growth. Both sets of projections end up about at the same level in 2031. 

Sources: Ministry of Agriculture and Rural Affairs and USDA.

In the Yicai article, Mr. Zhu noted last year's recovery of pork consumption from the African swine fever-induced shortage, but highlighted his assessment that pork consumption is still below a record level reached in 2014. Zhu said said pork's large share of meat consumption is a result of traditional cooking habits and he said the rural population accounted for most recent growth, narrowing the traditional gap between urban and rural per capita consumption. Zhu thinks younger generations are more inclined to consume poultry, beef and mutton. He thinks aging of the population also favors poultry because the elderly are more inclined to consume poultry meat.

Yicai also interviewed pork analyst Shen Yuanbing who suggested that pork consumption in China is near its saturation point. Shen agrees that aging favors poultry, eggs, and milk, as elderly people prefer  food that is light, easy to digest and nutritious. Shen also believes the growing popularity of ready-to-eat meals and fast food favors poultry, beef and mutton over pork. Shen expects annual growth of 1.5%-2.0%, driven entirely by consumption by rural residents and rural-urban migrants. 

Household consumption data for 2021 indicate a strong rebound in per capita pork consumption in 2021 with a record-high amount. 

Source: China household income and expenditure survey.

The Yicai article concluded with a shot across the bow of big hog-farming companies. According to Yicai, twenty publicly listed hog-farming companies produced 136 million head last year, 20% of the national total. With little room for growth in consumption, Yicai the "frantic expansion" of production capacity by these companies is "bound to trigger a game of fighting" over a limited market.