China's Rejections of Imported Meat Spiked in 2025

Chinese inspectors upped their rejections of beef, chicken feet, and pork from the United States, Europe and Brazil during 2025. Meat was rejected for containing hormones not permitted in China, failing sensory inspections, and lack of documentation or plant registration. The spike in rejections coincided with China's imposition of tariffs over the last 2 years designed to reverse losses of Chinese meat producers or to punish trading partners.

China's rejections of imported food during 2025 increased 55% from the previous year. The volume of shipments rejected increased 150%. These were the largest values since the customs administration took over inspections at the border from the now-defunct AQSIQ in 2018. 

Compiled from lists posted on China Customs web site.

China rejected food shipments from about 75 countries -- from Denmark and France to Pakistan and Belarus. The top 3 trading partners with the most rejections -- the United States, European Union, and Japan -- are not known for food safety problems. Rejections of U.S. food were, by far, the most numerous. Of the 4,889 shipments rejected by China in 2025, over 1,000 came from the U.S. The European Union was number 2 (628 rejections), and Japan was number 3 (383 rejections). 

Compiled from lists posted on China Customs web site.

Rejections of foods from the U.S. and EU clearly spiked in 2025. Rejections of Brazilian shipments also spiked last year at a much lower level.

Compiled from lists posted on China Customs web site.

Meat stood out as the food category with the largest number of rejections. Nearly 1,800 meat shipments were rejected (in HS codes 02, 0504, and 1602) with a volume of nearly 25,000 metric tons. All processed foods (HS chapters 18 to 21) had 1,056 rejections, and fish & shellfish (HS codes 02, 1603 and 1604) had 826 rejections. (Note that these lists appear to include only packaged goods, and it excludes bulk shipments of grains & oilseeds.)

Last year this blog noted the trend in meat rejections, and the trend was sustained during the second half of 2025. Rejections of beef, poultry, and pork clearly spiked in 2025. Meat offal was composed primarily of pork offal with some beef offal as well. There were few rejections of lamb.

Compiled from China Customs lists. Includes HS 02, 0505, 1602.

Most of the rejected beef and chicken imports came from the United States. Brazil also had significant numbers of beef and chicken rejections. Spain and Denmark accounted for most of the pork rejections. 

Chinese inspectors gave a variety of reasons for rejecting meats last year, but a few problems came up repeatedly. Most of the Spanish pork was rejected for containing testosterone, while Danish pork was mostly rejected for an unspecified "animal disease." Most of the U.S. beef rejections were for detection of a hormone (melengestrol acetate), with some additional rejections for progesterone, ractopamine, and incomplete documentation. Brazilian beef problems included lack of documentation, filth/spoilage, lack of exporter registration, and testosterone. Many shipments of U.S. chicken feet failed sensory inspections for unspecified reasons, contained nitrofuracillin, or had labeling issues. Brazilian poultry was rejected for documentation problems, lack of product approval, and failure of physical inspection.

It's probably not a coincidence that China's rejections of meats spiked at the same time China has been implementing formal measures to restrict imports of meat. In June 2024 China launched an antidumping investigation of European pork in retaliation for tariffs on Chinese electric vehicles. The AD duties were imposed in September 2025. In September 2024, China's State Council announced a rescue plan to rescue beef and mutton producers suffering from sustained financial losses. The plan was included in the 2025 "Number One Document" on rural policies. In December 2025 China announced extra "safeguard" tariffs on beef imports to protect the industry. China has been in a trade war with the United States since April 2025. China banned Brazilian poultry imports during June-December 2025 due to an avian influenza outbreak in Brazil. 

Compiled from lists posted by China Customs.

More background on the data and Chinese food safety laws is available from a 2021 report on this topic. Rejections of meat have increased dramatically since that report's analysis was conducted. There was no spike in rejections of U.S. food during the 2018-19 China-U.S. trade war. The elevated rejections of 

Ecuadorian shrimp rejections first gained prominence in 2020 during the covid pandemic when Chinese inspectors reported in news media that they banned shrimp from 3 Ecuadorian exporters after finding covid virus on the shipments. The panic about covid contamination of imported food magically evaporated by 2022, but China continued to reject dozens of Ecuadoran shrimp shipments every year, including 2025, citing unspecified animal disease and sodium metabisulfite as the reasons for most of the rejections. 

Antidumping Halted China's Lysine Export Growth in 2025

China's relentless growth in exports of the amino acid lysine was finally reversed in 2025. The value of exports fell more than the volume as AD actions by the EU, Brazil and the U.S. hit prices hard in the Chinese industry. Lower prices led to gains in dozens of other markets around the world, but the value of exports was down sharply.

Source: China customs data HS code 29224190.

Lysine is an essential amino acid that can be used in animal diets for protein synthesis to improve muscle growth and feed efficiency. China imported lysine and other amino acid feed supplements until the early 2000s, but China now produces an estimated 70% of the world's amino acids. In addition to lysine, China exports threonine, tryptophan, and methionine. 

China has the world's largest livestock herd, and China's agriculture ministry has been promoting domestic use of amino acids as a means of reducing use of soybean meal in animal diets. Yet domestic demand for lysine has been less dynamic than the export market. By my calculation, China exported 30% of the lysine it produced in 2019, and the share grew to 44% in 2023 (the last production figure available). An analysis by Chinese consultancy Boyar said antidumping duties were the factor that caused a steep drop in Chinese lysine prices last year. 

As growth in exports accelerated, the EU and Brazil began antidumping investigations of Chinese lysine during 2024. The United States announced an AD investigation May 28, 2025. 

During 2025 lysine exports to the EU--China's top market for the feed additive--fell by more than half. Exports to the United States and Brazil fell more moderately. Meanwhile, lower prices stimulated growth in exports to 68 countries led by India -- which surpassed the U.S. and Thailand to become the no. 2 market -- and Russia. 

Exports to the United States surged during May and June 2025, probably as buyers stocked up ahead of the antidumping investigation. Exports to the U.S. were impacted during October-December 2025.

China customs data, HS 29224190.

China's Enormous Corn Appetite: 1,400 Import Quota Applicants Can't Be Wrong

China's consumption of corn has grown by leaps and bounds over the past decade, but China still has the same opaque corn import quota mechanism that was set up 25 years ago when farmers fed whatever was available to backyard pigs and chickens and the country was dotted with thousands of rudimentary feed mills. China has spawned dozens of feed and livestock companies--including most of the world's largest--spread across the country. China has also become the world leader in manufacturing corn-based starch, lysine, and citric acid.

China adopted a "tariff rate quota" (TRQ) system for imports of corn, wheat, rice, cotton and sugar when it joined the WTO in 2001. Trading partners envisioned the TRQ creating a small market-driven trade for commodities previously controlled by nontransparent bureaucratic mechanisms. China's corn TRQ allows a quota of up to 7.2 mmt to be imported at a low tariff of 1% while additional imports are subject to China's prohibitively high 65% tariff. Prospective importers have to apply every year for a share of the 7.2 mmt quota.

After many requests from frustrated trade partners for more transparency, the Chinese Government began posting lists of applicants for TRQs in 2015. Those lists did little or nothing to promote trade, but the lists at least provide a rare source of information on prospective buyers of corn.

In 2015, over 1,000 Chinese companies applied to import corn, and corn was the 2nd-most popular TRQ after cotton. From 2016 to 2020 the number of applicants dwindled to 778 when China was dumping a stockpile of domestic corn into the Chinese market and subsidizing processors to use the corn. Chinese interest in corn imports revived in 2021 after the stockpile was depleted, Chinese corn prices went up 80% in 2020, and China agreed to import corn as part of the Phase One agreement with the United States. At the same time China's corn processing industry expanded rapidly in tandem with recovery of the swine industry from the 2018-19 African swine fever epidemic and with ambitions to dominate the global industry for corn-based industrial products.

Compiled from lists posted by China National Development & Reform Commission.

The actual import volume never hit the 7.2-mmt quota until 2020. Imports then exceeded the quota by a wide margin until 2024 with no explanation (imports would not have been viable at the over-quota tariff of 65%). The number of applicants increased to a peak of 1,453 requesting quota for 2025, but the lists do not reveal how much quota applicants requested nor how much they were able to import. Indications are that State-owned companies got most of the imports, even though the growth in corn demand was almost entirely among private Chinese corporations (see below). In 2025, applicants for corn quota had combined processing capacity of 453 mmt, but actual imports were slashed to 2.65 mmt -- the smallest volume since 2011 and again with no explanation. A slightly smaller number of 1,406 companies applied to import corn in 2026, but their processing capacity is still over 400 mmt. The corn TRQ attracted more applications than did the TRQs for wheat, rice, sugar or even cotton, demonstrating the hunger for imported corn in China. 

The quota lists reveal that animal feed is the predominant use of corn by quota applicants. This year's list shows 329 mmt of combined processing capacity for applicants reporting feed as their main product. Manufacturers of corn-based industrial products also had substantial capacity: starch and corn sweeteners (35 mmt), lysine and other amino acids (15 mmt), citric acid and monosodium glutamate (11 mmt), and fuel ethanol (6 mmt). Comparing this year's list with the 2023 list previously analyzed by this blog shows processing capacity of feed manufactures declined slightly over 3 years, but capacity of industrial corn product manufacturers increased by a combined 37 mmt. 

Not an exhaustive list of products.

The same large feed companies that are expanding in the swine and poultry industries (see last week's post on the swine industry) are prominent applicants for corn imports. The TRQ rules require each production site of a company to submit a separate application for quota. The large number of applications submitted by branches of companies reflects the sprawling regional and national networks of feed operations established by Chinese companies. Last year Twins Group branches submitted 88 applications and Wens Food branches submitted 86. The increase in applications between 2023 and 2026 by Wens, Twins, Liyuan, New Hope and Zhengbang reflects expansion by those companies. Less prominent, but also notable, is the increase in capaciy by amino acid giants Meihua and Fufeng. Among the largest companies applying for corn import quota, the number of applicants and their processing capacity increased between 2023 and 2026. There were 10 companies whose processing capacity that exceeded the entire 7.2-mmt quota. (Note: these tabulations exclude capacity reported by several company headquarters that appears to double-count capacity.)

Most of the largest companies applying for corn import quota are publicly listed Chinese companies. State-owned COFCO is the State-trading company that handles 60% of the import quota set aside for it, but it also has a network of feed, livestock, and fuel ethanol companies that apply for part of the quota. While COFCO branches submitted 29 applications for quota in 2026, COFCO's number of applications was static between 2023 and 2026. Foreign-invested Zhengda (Thai-based CP) submitted fewer applications in 2026 than in 2023, as did other multinationals not on the list below.

The largest number of applicants for corn import quota are in coastal provinces Shandong and Guangdong, but demand is widely dispersed across the country. For example, Twins Group and Wens Foodstuff each had applicants in 18 provinces. Applicants in Guangxi and inland provinces that are growth centers for feed and livestock production like Sichuan, Jiangxi, Hubei, and Henan also have large corn processing capacity and robust growth between 2023 and 2026.

Feed and livestock industry leaders in China facing corn prices 50%-to-70% higher than in exporting countries (see chart below) occasionally dare to question the TRQ system. In 2019, for example, the chairman of no.2 (at the time) hog producer Zhengbang recommended TRQ reform to expand access to more corn imports to help Chinese livestock companies compete on a level playing field in the international market. He pointed out that Chinese corn is expensive due to high production costs, and growing it year after year--often with 2 crops in one year--degrades China's limited farmland. In 2022, the founder of feed company New Hope recommended lifting restrictions on corn imports from South America (which was done) and expanding the share of corn import quota available to private companies (which apparently was not done).

On the other hand, a 2021 commentary in State media popularized the idea of the TRQ as a "firewall" that protects China's farmers. In 2024, Communist Party mouthpiece Farmers Daily addressed concerns about that year's plunge in corn imports by explaining that corn supplies needed to be pared back in order to force buyers to procure Chinese corn in order to reverse plummeting prices and boost domestic corn prices to a reasonable level. The article said imports could not continue at a pace exceeding the TRQ but did not explain how that happened, nor did the article explain what mechanism was used to reduce imports during 2024. One thing is certain: China's mechanism for managing corn imports is as opaque as it was before the TRQ was introduced. 

Keep Xi Jinping Firmly in Charge; Rural Officials Must Behave

Propaganda ahead of the Lunar New Year holiday shows Xi Jinping firmly in charge of everyone and everything. But he has pointedly refused to leave Beijing. Rural officials in the hinterland are warned to implement Xi's blueprint for overhauling the countryside, or else. Xi's "rural revitalization" in this year's 5-year plan is meant to retain the peasants' loyalty. But it could be backfire if massive spending, bank loans, carving up of rural land, and building construction breed corruption and mismanagement that undermine villagers' support for Party rule. 

This week's cheerful propaganda shows Xi Jinping visiting grassroots officials in Beijing to extend Spring Festival greetings and hype high-tech AI and robots as the key to China's future. The captions of each carefully staged photo began with a list of Xi's titles--General Secretary of the Chinese Communist Party's Central Committee, Chairman of the State, Chairman of the Central Military Commission--to cement the idea that he is fully in charge of all people within China--no matter what their ethnicity--and to all people of Chinese ethnicity all over the world.  Interestingly, Xi did not venture outside Beijing.

Xi extended "best wishes for the Spring Festival to all people of all ethnic groups across the country,
our compatriots in Hong Kong, Macao, and Taiwan, and overseas Chinese."

On February 6, Xi attended a Central Military Commission Spring Festival show where he greeted retired military officers who are stationed in Beijing.

Ministry of Agriculture propaganda ahead of the Spring Festival is also featuring the Minister's convivial visits with retired cadres from the agricultural system and courtyard gardening--also in Beijing. 

Meanwhile, the Agriculture Ministry held a "United Front" Spring Festival meeting with representatives from 6 "democratic parties," returned overseas Chinese and their family members purportedly to solicit opinions on rural work from "non-Party members." The meeting's gist was that General Secretary Xi Jinping has ordered Party organizations to mobilize non-Party members to implement the Party's rural revitalization policies during the 15th 5-year plan with "united hearts and minds" and "pooled strength."

An Agriculture Ministry meeting on January 27 had a less cheerful tone, ordering rural officials to wring corruption and graft out of the system as they implement the 15th 5-year plan in the countryside this year. Minister Han Jun ordered Party officials in the central Ministry and Provincial offices to "align [their] thoughts and actions with the spirit of Xi Jinping's remarks to the Central Disciplinary Inspection Commission." The first command was to focus on the "two safeguards": (1) "The core" intertwining of Party and Government is critical to China's destiny and (2) everyone must ensure the "unified" command, coordination, and decision-making of the Party's Central Committee. In brief, Xi must remain in charge. 

The January 27 session demanded thorough implementation of Xi's important instructions and strict political discipline and rules. It emphasized the need to more "scientifically and effectively confine power within institutional cages." The meeting demanded a "clean and honest culture" in the "new era" by unifying the authorization, exercise of power and control in rural work, by combating corruption, punishing graft, and regularly conducting disciplinary legal and warning education. 

While not mentioned, warnings to rural officials are surely backed up by last year's delayed death sentence given to previous Agriculture Minister Tang Renjian for violating party discipline. 

Rural plans involve billions of RMB in bank loans and intergovernmental transfers and taking charge over rural land and building assets, presenting a cornucopia of opportunities for corruption and slipshod work that undermines confidence in the Party's leadership and perpetuates despair and chaos in the countryside. The January 27 meeting mentioned initiatives to prevent a return to poverty, rectifications of rural collective asset management, and addressing problems with construction of high-standard farmland. The document's final command is to "Deepen the fight against corruption and misconduct in the field of rural revitalization" and obey the 8 rules of discipline introduced by Xi when he took power in 2012.

The "Number One Document" on the "Comprehensive Revitalization of Rural Areas" that serves as a blueprint for the 15th 5-year Plan calls for earmarking budgetary funds and ultra-long bonds for construction in rural areas and encouraging banks to lend to rural areas (Paragraph 23). In the same paragraph is an exhortation to severely investigate and punish falsification of reports, favoritism (in awarding funds), embezzlement, and misappropriation of funds. 

Faith in Xi's leadership could be undermined by failure to solve chronic problems in the countryside reflected in the Document's exhortations to clean up sewage, trash, "black and odiferous" bodies of water, and heavy metal-contaminated farmland. The Document also orders a clean-up of social breakdown in the countryside by promising to lead creation of a moral atmosphere in rural areas, "establish correct views on marriage, childbirth and family," ban exorbitant wedding dowries, prevent juvenile delinquency, improve the rural funeral system, and manage rural cemeteries. 

Elsewhere the document calls for campaigns against organized crime, curbing the proliferation of "village bullies" and family-based criminal gangs, crackdowns on gambling, drug trafficking, infringement of the rights of children, women, and the disabled, telecommunications fraud, and illegal financial activities. Churches, mosques, and monks cannot be trusted to clean up society: the Number One Document promises strong "management of religious affairs." It also promises to deploy unified management of border regions.

Paragraph 27 demands rectification of "weak and disorganized village Party organizations." The misalignment of incentives that leads to rural brain drain is reflected by orders to shore up the rural management workforce, recruit civil servants to work in the countryside, prohibit temporary transfers of county and township staff, and boost salaries for village cadres. These reflect the strong incentive for rural officials to move up to municipal or higher-level jobs asap and the tendency for officials to parachute into a rural post just long enough to burnish their credentials without gaining a real stake in the success of programs they manage or initiate. The Document calls for deepening efforts to address formalism and to reduce the "burden" on rural officials -- the growing number of responsibilities heaped on them that prompts them to just go through the motions by filing paperwork and checking boxes. The same paragraph adds another responsibility by ordering officials to effectively implement the decennial agricultural census that begins this year.

The "Number One Document" begins with an order to "adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era" and it closes with an exhortation to "unite even more closely around the Party Central Committee with Comrade Xi Jinping at its core," bringing agricultural and rural modernization to a new level and making strides toward becoming an agricultural power. 

China's Feed Production Outpaces Meat Output

Growth in China's animal feed production continued to outstrip growth in its livestock output last year, according to data released by China's Feed Industry Association.

Feed output increased 27.2 million metric tons (mmt) in 2025 to reach 342.25 mmt, while production of meat and eggs increased by only 3.2 mmt. Over the past decade, 2015-2025, feed output increased by s cumulative 142 mmt, more than 10 times the 13.8 mmt increase in meat and egg output over those years. 

There were 37 manufacturers with output exceeding 1,000,000 metric tons, with a combined market share of 57%, up 2 percentage points. 7 had production exceeding 10 mmt. 

Source: China Feed Industry Association and National Bureau of Statistics.

The value of feed industry output increased by only 2.3%, and income from feed increased by only 2.7%, suggesting that prices fell. The value of feed milling machinery produced fell by 0.2%.

Consistent with last week's post about breakneck expansion in the swine industry, swine feed output increased by 22.5 mmt last year, accounting for most of the increase in feed output. Feed for meat poultry increased by 3.4 mmt, and aquaculture feed output increased by 600,000 mt. Swine feed comprised 48.6% of last year's feed output. 

China Feed Industry Association.

Swine feed output was 166 mmt, 2.8 times last year's pork output of 59.4 mmt. This ratio was higher than the 2.5:1 ratio during 2021-24. The ratio has been on an upward trend over the past 15 years. The feed:meat ratio for poultry meat was even higher, at 3.7 mmt. These ratios are inconsistent with on-farm feed efficiency widely reported at less than 2 for poultry and under 3:1 for hogs. Feed efficiency has been improving gradually on the ground. 

Ratio of swine feed output from China Feed Industry Association
to pork output from National Bureau of Statistics data.

The growth in manufactured feed output probably represents in part a decline in on-farm mixing of feed as manufactured feeds are increasingly delivered to farms. In another sign of increased commercialization, the association reported that bulk feed grew 18% (displacing bagged feed) to account for 53.4% of feed products.

Production of feed additives grew from 16.1 mmt in 2024 to 17.62 mmt in 2025. Production of amino acids grew 13.9% to 6.6 mmt in 2025. 

Compiled from China Feed Industry Association data releases.

Geographically, the provinces with the largest feed output were Shandong (49.1 mmt) and Guangdong (40 mmt). Provinces with the largest increases were Guangdong (+3.56 mmt), Shandong (+2.75 mmt), Sichuan (+2.43 mmt), Guangxi (+2.34 mmt), and Hubei (+2.2 mmt). 

The association said soybean meal accounted for 13.4% of compound and concentrate feed, the same as the previous year. The report said use of rapeseed meal, cottonseed meal and other meals increased by 3%. Use of rice, wheat, and sorghum decreased. The report did not mention corn.

China's Vanishing Soybean Self-Sufficiency Rhetoric

Chinese propagandists appear to have given up on soybean self-sufficiency now that China has gained the upper hand over the U.S. on the soybean trade war front. The barrage of Chinese articles about finding soymeal substitutes, low protein animal diets, corn-soy intercropping, etc. has quietly faded from Chinese media. China's plan to bolster soybean self-sufficiency actually failed, but Brazil's bottomless soybean supplies nevertheless enabled China to snub U.S. soybean producers during last year's trade war. Xi Jinping now is free to make offers of soybean purchases to President Trump in trade negotiations without appearing to do so from a weak position. Mission accomplished, but not in the way Chinese strategists planned.

Back in 2019--at the height of the first U.S.-China trade war--China's "Number 1 Document" announced a "soybean revitalization plan" to increase self-sufficiency in soybeans. Soybeans were pronounced to have strategic significance and were included in several important documents. Xi Jinping endorsed the plan. When the program was announced, China had just harvested 16 million metric tons of soybeans in the Fall of 2018 and imported 88 million metric tons of soybeans during calendar year 2018. Those numbers imply nearly 85% of China's soybean supply was imported and a self-sufficiency rate of 15.4%.

In 2025, China produced 20.9 million tons of soybeans, and China imported 108 million metric tons of soybeans. Thus, between 2018 and 2025 China increased its soybean output by 4.9 million metric tons, but its imports increased by 20 million tons. Those numbers imply 84% of China's soybean supply was imported in 2025, marginally less than the percentage in 2018. Quick calculations suggest there has been no secular increase in self-sufficiency. Self-sufficiency peaked at 18% in 2022 and has fallen 2 percentage points since then. It seems unlikely that self-sufficiency will ever reach even 20%.

Chinese leaders are not too concerned about the increase in soybean imports, because the increase came from Brazil, not the United States. Brazil supplied China with 82 million tons of soybeans during 2025, enabling China to shut down imports of U.S. soybeans most of the year and create angst among U.S. farmers. 

The Chinese soybean revitalization plan's measures failed to reduce soybean consumption. In 2025 China imported and consumed a record volume of soybeans. The plan also failed to increase soybean production. China's soy output did increase during 2018-20, but that was mainly due to low corn prices during those years that incentivized a return to soy planting. Soy output plateaued at just above 20 million metric tons during 2022-25. Nor did China find substitute protein meals or new suppliers of soybean imports as envisioned in the 2019 plan. China simply increased its reliance on Brazilian soybeans. 

Chinese officials now seem less concerned with raising soybean self-sufficiency. At a January press conference celebrating last year's rural policy achievements, a vice minister of agriculture praised last Fall's 20.9-million-ton soybean harvest as the fourth year in a row with production exceeding 20 million metric tons. He celebrated this as success in "consolidating the increases in soybean and oilseed production," the objective included in the 2025 and 2026 "Number 1 Documents" on rural policy. The real objective of the soybean revitalization was to prevent Chinese soybean production from vanishing, not to actually become self-sufficient. They now implicitly acknowledge that striving for further increases in soybean self-sufficiency is unrealistic. 

This week, a Chinese academic told the Chinese public not to be concerned that China imports over 100 million metric tons of soybeans because the beans are needed to supply soybean meal for China's growing demand for animal feed. He went on to reveal that China's farmers can't even sell the 20-million-tons of domestic soybeans they produce. The Chinese scholar explained that China's soybeans are distinct from imported soybeans because they have a high protein content suitable for food products like tofu and soy milk. The Chinese academic explained that the market demand for food-grade soybeans in China has been steady at about 16 million metric tons, about 4 million metric tons less than the amount produced. 

(The government buys up the surplus Chinese soybeans to store in government reserves in order to prevent the price from falling. Keeping prices of domestic soybeans high, in turn, perpetuates the reliance on cheaper imported soybeans in the crushing sector.)

Chinese leaders have a long history of going back and forth between rhetoric about soybean import angst and acceptance of the economic reality of importing them. As this blog pointed out in 2019, Chinese officials have rolled out initiatives and plans to revive the soybean industry for decades, and now most have been memory-holed. Many of the plans targeted increases in high-oil content soybeans with breeding programs, demonstration farms, and targeted subsidies. During 2010-15, subsidies and plans couldn't stop the decline in soy production when Chinese farmers were planting their land in corn to take advantage of high prices. Recovery of soybean output from 2016-19 was due to a collapse in corn prices. Soy production dipped in 2021 following a new spike in corn prices.

Xi Jinping is probably happy at the moment that he can promise soybean purchases as a bargaining chip in negotiations with President Trump without appearing weak, but no one else is really happy in the soybean industry. 

Chinese officials are assuring their farmers they are doing all they can to ensure farmers get good prices, and they doled out direct payments to Chinese soy producers equivalent to about USD 300-to-400 per acre last year to keep soy production above 20 million tons. China spends about USD 3 billion annually on soybean subsidy payments, according to its submissions to the WTO.

There are traces of dissent in China's soybean processing industry. An article last week about financial losses incurred by a State-owned Beijing food company complained that the reliance on South American soybeans increased its cost of producing soybean oil and the quality of the soybeans was unsatisfactory. The article also blamed lengthy customs inspection times for rising costs. This blog previously reported on Chinese allegations of Brazilian price gouging on soybeans.

The U.S. Government is giving its farmers $12 billion in "Bridge Payments", promising to use more soybeans in biodiesel, and there is talk of a farm crisis. 

Meanwhile, there are grumblings from Brazil about soybean prices that don't cover production costs, and a report of growing financial pressure on Brazilian entities in the soybean sector.

Can't Stop, Won't Stop: Chinese Pork Giants Keep Expanding

Giant Chinese pork producers are expanding aggressively to achieve scale economies and exert control over every link in the supply chain. Wringing every penny (or fen) out of unit cost is viewed as the key in this winner-takes-all competition for a market that is not growing. Government authorities ordered companies to scale back capacity last year, but no one dares to let up on their expansion plans.

China's 39 largest hog enterprises (slaughtering 1 million or more hogs) produced 295 million hogs in 2025, accounting for 41% of the national total, according to data from a "high level hog farming forum" released by China Feed Information Net. All but 2 of the 39 largest hog producers increased their output during 2025, many of them by double-digit percentages. 

• The million-plus-head companies together increased their hog output by 51 million head (up 21%) in 2025,
• National hog slaughter reported by the National Bureau of Statistics increased by 17 million head (up 2.4%). 
• If these numbers are consistent, that means farms selling less than 1 million head reduced their production by 34 million head (down 7.4%).

An increase in the average weight of hogs magnified the increase in pork supply. Despite orders from officials to stop the practice of "second fattening" -- in which companies sell mature hogs to independent farmers who fatten them to even larger weights -- the average carcass weight calculated from official data increased from 81.2 kg to 82.5 kg between 2024 and 2025.

Prices have fallen because "consumer demand is weak and unable to support the current level of supply" according to an article by "Zebra Consumption". Food service businesses are seeing low customer traffic, revenue is sluggish, and the food service sales index was at its lowest level in 16 months during November. The article said pork consumption is undermined by ample supplies of competing proteins such as poultry, beef, and lamb.

National Bureau of Statistics data show that the hog price fell after peaking in August 2024, stabilized during the first half of 2025. The price fell again during September 2025--normally a peak consumption period with reopening of schools and the October 1 National Day holiday. The average hog price at the end of December was down 25% from a year earlier. Prices rebounded slightly in January 2026--leading up to the Lunar New Year holiday--but prices are still lower than during the last 2 years.

National Bureau of Statistics raw material prices paid by enterprises.

The index for hog prices received by Chinese farmers in Q4 2025 was down 23.7% from a year earlier, the largest decline of any farm product category. China's December 2025 CPI report showed that consumer pork prices were down 14.6% from a year earlier, the largest decline of any category.

Three companies competing to be the top producers accounted for the lion's share of China's hog production expansion: Muyuan Foodstuff, Wens Food stuff, and Twins Group. Muyuan is the clear leader, producing 78 million hogs in 2025, up 6.4 million from the previous year. Wens is number-2, producing 40 million head, but it expanded output by 10.3 million in 2025. Twins produced 26.4 million head and increased output by 8.7 million head in 2025. Twins is merging with Zhengbang Technology, another top hog producer that is emerging from bankruptcy.  

Many large pig companies had announced plans to curb production capacity as far back as October 2024. Government officials held several rounds of meetings with hog companies in 2025, urging them to cut back on capacity, canceling subsidies, and issuing maximum sow quotas. The number of sows did fall moderately in Q4 2025 and year-end inventory was down 2.9% from a year earlier, but China is still glutted with pork. 

Many companies saw flat or declining revenue from hog sales during 2025 due to plunging prices offsetting expanded volume of hog output. Muyuan, for example, reported an 8.9% increase in volume of hogs sold, a 17.3% decrease in average sale price, and a 2.5% decrease in sales revenue year-over-year. Wens had stronger growth in slaughter volume, but its sales revenue was flat. Muyuan and Wens both reported declines in profit during 2025. 

A December analysis by Boyar examines the jockeying among top Chinese hog producers by highlighting the strategic maneuvers of Twins Group to challenge the top producers while accelerating the consolidation of China's hog and feed industries.

Central to Twins Group's strategy is its agreement to take over the assets of Zhengbang, a high-flying hog producer that went bankrupt after taking on debt to finance a breakneck expansion that unraveled when hog prices plummeted. After integrating Zhengbang's assets and taking the company public by 2027, Boyar expects Twins to surpass Wens as the number-2 hog producer and possibly challenge number-1 producer Muyuan. 

Boyar points to Twins' strategy of low margins and high volume setting off a scramble among companies to gain cost advantages by making investments in raw material procurement and logistics. Boyar notes that Twins has established trading companies and procurement teams and is expected to acquire more assets in grain storage, procurement, trucking, and shipping by utilizing funds from an anticipated IPO. The quest for cost savings motivates companies to expand operations so they can spread fixed costs over ever-larger volumes of raw materials and output, thus keeping unit costs low. 

Most of the hog-farming behemoths are feed manufacturers. Muyuan, Wens, Twins, New Hope, Haid, Zhengda (a subsidiary of Thailand's Chia Tai) and Liyuan were all in the top 10 of a ranking of global feed manufacturers. Boyar anticipates that this will also shake up the feed industry as Twins-Zhengbang consolidates control over feed sources and moves to the top of the feed industry rankings.

While New Hope and Haid (海大) are larger feed companies, they are deeply involved in poultry and aquaculture, respectively. Twins is focused on pigs and is the world's largest pig feed producer. Boyar speculates that competitors like Haid will be under pressure to make capital investments in supply chain to match Twins' cost advantage. A focus on pigs is a gamble, though, since consumption of poultry, fish and shellfish is growing much faster than pork.

Boyar sees more consolidation in the livestock industry as Twins leverages capital to pull more small and medium-sized feed mills and hog producers into its orbit through acquisitions, mergers, and collaborative relationships. Mid-size companies like Aonong Biological, the 9th-ranked hog producer in 2023, have been falling behind in part because they can't match the low unit costs of their huge competitors. New Hope has been falling behind in pig production and Boyar thinks they will also lose swine feed customers if Twins is able to use its cost control to cut prices. 

Twins' ability to wring cost savings out of its raw material procurement can help it challenge Muyuan's hog production cost advantage -- often attributed to Muyuan's integrated breeding-farrow-to-finish production model and its scale economies. Its digital production techniques, biosecurity system and "company + farmer" model will be promoted nationwide. Farms and feed mills that don't conform will be forced out of the market, Boyar predicts.

Boyar thinks Twins can expand rapidly to challenge Muyuan by using its "company + farmer" model to recruit farmers to fatten pigs. Twins' feed cost reductions can challenge Wens as the "company + farmer" leader and make inroads on Wens' home turf in southern China that has large numbers of independent hog producers.

A December 2025 "White Paper on the High-Quality Development of China's Pig Industry" made a similar point by citing eagerness of companies to achieve scale economies to explain the industry's overcapacity problem. While Boyar expects small and medium-size companies to be forced out, few seem to ever fail. Feed industry reports have complained since the 1990s about the vast number of small companies that won't go away as big companies expand, and chronic excess capacity is the result. The one big casualty of overexpansion -- Zhengbang -- never went away and is now a key player as part of Twins Group.

The amount of investment capital continually poured into this hamster wheel of an industry is surprising. It reflects the large amount of money sloshing around due to capital controls, financial repression in the State-dominated banking sector, and the collapse of the property sector that used to be the main destination for capital investment. 

The ability to absorb losses is also surprising. While the "Zebra Consumption" article remarked that "...the traditional hog cycle has been completely disrupted," the long-established pattern in China's hog industry of making lots of money on hogs in 1 year and losing money for 3 years has not really changed yet. This keeps companies in the game waiting for the next big payoff.