Lihua’s pig business remained slightly profitable in Q1 2026 despite a sharp month-by-month decline in hog prices, supported by strong cost control. While yellow broilers remained the company’s main revenue driver, the pig unit delivered a higher gross margin in 2025 and, for the first time, contributed more annual profit than the broiler business.
Lihua’s pig business remained slightly profitable in the 1st quarter of 2026, even as hog prices fell sharply month by month. The company said during a recent call on its 2025 annual report and Q1 2026 results that cost control helped keep the unit above breakeven.
For the quarter, Lihua reported operating revenue of CNY 4.99 billion (USD 694.29 million), up 22.00% year-on-year. Net profit attributable to shareholders of the parent company was CNY 155.00 million (USD 21.59 million), down 24.85%. The main profit contributor was the yellow broiler business, as the market for yellow broilers proved stronger than is usual for the seasonal low period.
According to Lihua’s sales brief, the company sold 132 million broilers in Q1, generating sales revenue of CNY 3.57 billion (USD 497.63 million). In the same period, hog sales reached 552,200 head, with revenue of CNY 803.00 million (USD 111.84 million). Average hog selling prices in January, February, and March were CNY 13.12/kg (USD 1.83/kg), CNY 12.08/kg (USD 1.68/kg), and CNY 10.32/kg (USD 1.44/kg), respectively.
Lihua’s full cost of pig production declined from about CNY 12.00/kg (USD 1.67/kg) in December 2025 to CNY 11.80/kg (USD 1.64/kg) in Q1 2026.
Cost control remains the main line
Lihua said it has been developing its pig business in East China for 15 years, with cost control running through the entire process. After going through the industry epidemic pressure that began at the end of 2018, the company said its pig production cost has completed a U-shaped reversal and returned to the industry’s leading group.
“Through breed improvement and gains in some production indicators, there is still room for the company to further reduce pig production costs. Provided feed price increases remain reasonable, full-year costs are expected to stay below CNY 12.00/kg,” Lihua said.
In 2025, Lihua posted operating revenue of CNY 18.73 billion (USD 2.61 billion), up 5.67% year-on-year. Net profit attributable to shareholders of the parent company was CNY 578.00 million (USD 80.50 million), down 62.01%. The company said the profit decline reflected the cyclical impact of lower year-on-year prices for yellow broilers and hogs.
Even so, Lihua said its core business scale continued to grow steadily. In 2025, it marketed 567 million broilers and 2.11 million hogs. For the 1st time, annual profit from the pig business exceeded that of the broiler business, showing the risk-resilience of its 2-engine model.
The annual report showed that the broiler and pig businesses generated revenue of CNY 14.63 billion (USD 2.04 billion) and CNY 3.90 billion (USD 543.45 million), respectively. They accounted for about 78% and 21% of total revenue, but their gross margins differed sharply: 9.28% for broilers and 18.27% for pigs.
Yellow broiler outlook
For yellow broilers, which remain Lihua’s largest revenue source, the company expects the overall market in 2026 to stabilise and recover. It also plans to focus management on quality improvement and market premiums, while continuing to build an integrated supply-chain advantage through breeding improvement, channel and brand promotion, scientific production, and better energy efficiency.
Lihua has built annual broiler slaughter capacity of 150 million birds. In 2025, slaughter volume was nearly 90 million birds, and the 2026 target is 100 million. With slaughter capacity utilisation climbing quickly and customer development strengthening, the company’s slaughter business turned profitable in Q1.
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