BOABC Viewpoint: Jan-July investment in live hog industry down 7% YoY, western regions became key areas for investment

According to the statistics of BOABC, the total investment in live hog farming in China from January to July 2019 was about 54 billion yuan, down 7% year on year. The total invested capacity is about 32 million heads, down 13% year on year. In terms of the total investment, it is not much different from the same period of 2018. But the hog farming groups have been obviously moving their production capacity from northeast region to the southwest and northwest regions.
 
From the perspective of investment time: During the Spring Festival period, the outbreak of African swine fever was serious in China. From January to February, almost all hog farming enterprises stopped the investment process. After March, the hog farming groups began to resume the investment process gradually led by Muyuan and New Hope. In June and July, the investment enthusiasm increased significantly.
 
From the perspective of investment region, the production capacity layout is obviously moved from northeast region to southwest and northwest regions: From January to July 2019, the investment layout of China's live hog industry is mainly concentrated in Shandong, Yunnan, Sichuan and Gansu. The planned production capacity of the TOP4 invested provinces accounts for 81% of the total. Among them, the invested production capacity in Shandong is about 8.5 million heads, accounting for 27% of the total; in Yunnan is about 6.5 million heads or 21%, in Sichuan is about 5.6 million heads or 18%, and in Gansu is about 4.8 million heads or 15%.
 
Due to the disease outbreak this year, Heilongjiang, Liaoning and Jilin have withdrew from investors' first choice, and hog farming production capacity began to move to southwest and northwest regions significantly.