Let them eat chicken? Why all options are on the table to solve China's pork crisis


On a windy autumn afternoon Beijing taxi driver Zhou Shidong walked into a tiny restaurant and ordered a bowl of luzhu.

The Beijing dish of pork intestine and lung has traditionally been a cheap source of meat protein for people in China but for Zhou it is becoming unaffordable.


"It's crazy. The price has jumped from 18 yuan (US$2.56) a couple of months ago to 25 yuan (per bowl)," he grumbled. "And the two slices of pig's head meat have disappeared!"

The restaurant owner was just as upset.

"Wholesale prices of the pork offal have doubled! Whom can I complain to?" he shouted. "Even with the (retail) price increase and cost-saving measures, we still can't make ends meet. I'm afraid we'll have to close the restaurant within months."


Zhou and the restaurant owner are among the millions of Chinese feeling the pinch from a near 70 per cent increase in the price of pork across the country in the last year as African swine fever has cut a deadly swathe through the country's pig stocks.

For China, it means much more than a dietary switch and plugging supplies with overseas sources - observers say it could become a source of economic uncertainty and deep public discontent, remedied only by an overhaul of the production system.

Pork has long been a central part of Chinese cuisine and it is hard to overstate its importance - in Chinese, "meat" refers to pork while sources from other animals are differentiated as "cow meat" or "chicken meat". Although its share has fallen in recent years as people become more health conscious, pork still makes up around 70 per cent of the country's total meat consumption.

In addition, the character jia , which means both "home" and "family" in Chinese, reflects a roof over a pig's head, linking pork with the sense of security and happiness.

Once a luxury, pork consumption has increased sevenfold since the 1980s when the central government liberalised agriculture. Today, China is home to half the world's pigs and now consumes about 500 million swine a year, with over 95 per cent sourced from domestic supplies.

But in just over a year, African swine fever has killed 130 million pigs, or one-third of China's herd, according to official sources.

The resulting shortage has sent prices to their highest levels since November 2013, with consumer inflation reaching 3 per cent in September, according to data from the National Bureau of Statistics.

That month, pork was 69 per cent more expensive than a year earlier, and lamb, beef and poultry prices rose as well, as shoppers switched to other meats.


Vice-Premier Hu Chunhua warned in August that pork supplies would be under "extremely severe" pressure in the last quarter of 2019 and the first half of 2020.

On Thursday, Premier Li Keqiang chaired a State Council meeting in Beijing calling on cadres across the country to work hard to ensure supplies and stabilise prices.

"We need to … press on with the various measures to revive our pig herds, and take sensible and reasonable steps to ease restrictions on pig farming in specific places," a summary of the meeting said.

While the middle class and wealthier members of Chinese society can cope with the price increases, the great number of people in low income groups - from pensioners to minimum wage earners - have been hit hard, according to Tsinghua University economist Yuan Gangming.

"(Low-income groups) have not enjoyed 'pork freedom' for a long time, and the pork price surge is threatening to pull them back to the old days when they didn't have enough pork to eat," Yuan said. "Thus their bitterness would be the severest."

Pork accounts for two-thirds of the meat Chinese people eat, while poultry has a 21 per cent share, beef 8 per cent and lamb 5 per cent. The pork price surge has already driven up the price of alternatives such as chicken and beef.

"The pork price is a big share of China's consumer prices and has knock-on effects on other consumption. It affects inflation and people's livelihood, thus crucial to economic and social policymaking," Yuan said.

The crisis comes as the country approaches an important deadline - the ruling Communist Party has promised that by 2021, the centenary of the party's founding, that China will be a "moderately prosperous society in an all-round way".

According to a leaked document on boosting pig and pork supply seen by the South China Morning Post , Hu warned on August 30 that it was both an economic and political imperative to ensure a sufficient supply of pork.

"If people can't access or afford pork … it will seriously affect the achievements of a well-off society and hurt the image of the party and the state," Hu said, according to the document.

For Zhou, the taxi driver, prosperity is a "vague" idea. "What I care about is whether I can eat luzhu at a reasonable price and have enough money to feed my family," he said.

Zhou said he earned 5,000 yuan (US$715) a month and that was the only source of income of his family. He said the high pork prices meant the cost of the meat ate up over 10 per cent of the household's income.

Concerned about public discontent evolving into a crisis, Beijing has tapped to national pork reserves, issued pork coupons to subsidise consumers in several southern cities, revoked environmental bans on small farms and subsidised farmers to breed more pigs.

China is also set to increase pork imports from the United States as part of the trade deal with Washington. China imported 85,700 tonnes of pork from the US last year, which accounted for just 0.16 per cent of the country's entire pork imports.

To drive home the point, Li visited a roadside food stall in Xian, Shaanxi province, in a public show of concern last month, according to state news agency Xinhua.

Li asked customers how much roujiamo, or "meat in a bun", was, how the customers felt about the price rise and how their life was affected, Xinhua reported.

In Beijing, Wang Lingmei, a 67-year-old Beijing resident said she had been shifting to eat more vegetables and poultry after the pork price surge.

"But my nine-year-old grandson likes pork. It's a big pleasure seeing him devouring the meat," she said. "I would feel sorry for myself if I cannot afford to buy the meat for him."

While consumers have alternatives, the shortage does have implications for the country's leadership, according to Steve Tsang, director of the SOAS China Institute at the University of London.


"I would not say that the pork shortage is a big issue concerning people's livelihood and even social stability. There are plenty of alternatives to pork for consumers in China," Tsang said.

"But it is still a big deal as the party promised Chinese nationals that under its leadership tomorrow would be better than today - and a tomorrow without pork is not what most Chinese will see as a better future."

Tommy Wu, senior economist with Oxford Economics, said the pork shortage would "definitely have an impact" on the economy given pork was an important part of the Chinese diet.

"However, the supply of vegetables and grain seems to be sufficient and should help balance the fallout of pork supply shortage and mitigate impact on people's livelihood," Wu said.

But analysts say the pork shortage will probably not be solved in the short term and the impulse to have a quick fix may lead to mishandling.

Consumption switching and international trade can only be very partial solutions, according to Ernan Cui, an analyst with Gavekal Dragonomics.

While China is actively looking to import more meat from countries such as Denmark and Brazil, the limited supplies from overseas will not fill the gap, according to analysts and business insiders.

"In a sense, the government is right to focus on a recovery in domestic supply, as that is the only possible route to satisfying China's huge demand for pork," Cui said.

"But attempting to expand pork production before the African swine fever epidemic is effectively controlled will just lead to more boom-bust cycles," she said.

China's National Development and Reform Commission, the country's economic planner, has offered subsidies of up to 5 million yuan (US$700,000) to any pig farm that seeks to rebuild or expand existing facilities or relocate from areas where breeding is still forbidden due to the disease.

"African swine fever is so deadly, and so contagious, that it requires wholesale restructuring of pig-breeding practices (in China) to eliminate the disease and prevent its recurrence. This process has taken years to complete in other countries hit by the disease, none of which faced a problem anywhere as large or complicated as the one that now confronts China," Cui said.

The government has been busy projecting public confidence in containing the spread of the disease. In a press conference last month, the Ministry of Agriculture and Rural Affairs claimed that the spread of swine fever outbreaks had slowed, with only 14 new outbreaks between July 3 and October 14, compared with 44 new outbreaks in the first half of 2019 and significantly down from the 99 in the second half of 2018.

But it has been clear for months that the spread of the disease is much more severe than the government acknowledges, as many outbreaks are never reported to officials, according to Cui.

E.W. Johnson, from the Enable AgTech Consulting in Beijing, said the epidemic had not been effectively controlled and "it would take at least three more years if there is strong effort for China to put the pig back".

Henry Hing Lee Chan, a political economist and visiting senior research fellow at the Cambodia Institute for Cooperation and Peace, said the price jump reflected poor government reaction to the outbreak of the disease.

"The Chinese government has stepped up the importation of meat this year but it is apparently too late," he said.

"This is a biosecurity and disease issue. Solving it by relaxing (environmental) zoning and offering subsidies to encourage setting up of farms is not the right solution."

"The State Council will suffer a reputation damage because they cannot boost the pork supply by what they are doing."

Additional reporting by Keegan Elmer

Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.



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