How to Tame China’s Wild Pork Price Cycle

After a rollercoaster-like two years, pork prices in China have come back to earth. Price swings have been magnified by two health crises—African swine fever and Covid-19. But the collateral damage to small farms could actually make for a somewhat less wild price cycle in the future, as the slow consolidation of China’s massive pig-rearing industry takes another step forward.

Hog futures in China have risen more than 20% from last month’s low, signaling a reversal of the sharp decline earlier this year. But that still leaves them far below the heady levels of 2019 and 2020. Hog prices have fallen by nearly two-thirds since January thanks to a one-two punch of oversupply and the low season for demand.