Research On The Impact Of Hog Cycle On Financial Behavior And Performance Of Pig-raising Enterprises

Pork is the main meat consumption food in China,which is of great significance to the development of our national economy.Pork price has been attracted more attention for a long time.Hog cycle is an economic phenomenon with cyclical changes in pork price,which has exerted a profound impact on China’s pig breeding industry.In 2019,the pork market ran at a high price,Muyuan Co.,Ltd’s net profit doubled and entered the market value of 100 billion,while Chuying Agro-Pastoral Co.,Ltd was forced to withdraw from the market due to poor management.Based on the cobweb theory and the financial environment starting point theory,this thesis constructs the analysis framework.By analyzing the impact of pig price fluctuation on financing behavior,investment behavior,dividend policy and financial performance of the two enterprises to find out the reasons for the rise of Muyuan Co.,Ltd.and the decline of Chuying Agro-Pastoral Co.,Ltd.The purpose of this study is to further enrich the relevant theories of the impact of pork product price fluctuations on corporate financial behavior and performance,and to provide policy recommendations for enterprises to adopt financial behavior to deal with product price fluctuations and stabilize financial performance.According to the research,this thesis finds that the growth rate of debt financing,investment scale and financial performance of Muyuan Co.,Ltd.and Chuying Agro-Pastoral Co.,Ltd.keep the same direction with the alteration of pork price.Muyuan Co.,Ltd.copes with the pork price fluctuation by applying the ways of borrowing opponents’ power to compete and exercising the internal works.It improves the internal performance management,refines cost management,and increases the amount of pig slaughter.Muyuan Co.,Ltd.also adheres to integrated and specialized management,which aims to achieve the goal of high profit when the price of pork rises,small profit but quick turnover when the price of pork falls,and reduce the impact of the downward trend of the price of pork.However,Chuying Agro-pastoral Co.,Ltd.deals with the fluctuation of pork price by adjusting the proportion of pig-raising business.Through making multi-plate industrial layout and the investment structure from real to virtual to avoid the risks caused by the change of pork price to the company,which is one of the reasons for the difference in financial performance between the two companies.