Feed cost shocks and profitability pressure in China’s hog supply chain: evidence from a NARDL analysis

Feed cost volatility is a recurrent source of stress in livestock systems and an important challenge for sustainable food systems. This paper examines how feed cost shocks are linked to price and margin dynamics in China’s hog supply chain and whether they coincide with producer-side profitability pressure. Using monthly data from January 2015 to December 2025, we combine descriptive analysis, unit root and cointegration tests, a baseline nonlinear autoregressive distributed lag (NARDL) model for hog prices, profitability-oriented NARDL specifications, and time-varying estimation based on subperiod and rolling-window analysis. The results show a stable long-run relationship between feed costs, piglet prices, and downstream hog-sector outcomes. Bounds-test statistics strongly reject the null of no cointegration in both the baseline and profitability-oriented models. Piglet prices are estimated to have a larger long-run association with hog prices than direct feed cost shocks, indicating that production expectations and breeding-side adjustment remain central to hog-market dynamics. Feed cost shocks are also linked to producer margins: they are consistently associated with deterioration in the hog-to-feed ratio and with higher profitability pressure. However, the evidence for strong asymmetric pass-through is limited. Full-sample Wald tests do not support robust long-run asymmetry, and rolling estimates suggest that any asymmetry is weak and phase-dependent rather than persistent. These findings imply that resilience in China’s hog supply chain depends less on a permanently asymmetric transmission mechanism than on the system’s ability to absorb repeated feed cost shocks without prolonged margin compression. The paper therefore highlights the value of integrated monitoring of feed markets, piglet markets, and margin-based indicators is therefore essential for strengthening supply-chain resilience and supporting more targeted stabilization policies.