Biology of Business

Luohe

TL;DR

China's only 'Famous Food City' produces 25% of national pork output — Shuanghui's $7.1B Smithfield acquisition created a trans-Pacific protein supply chain from a Henan slaughterhouse.

City in Henan

By Alex Denne

In 2013, a meat processing company headquartered in Luohe — a Henan prefecture-level city that most Chinese people would struggle to locate — completed the largest Chinese acquisition of an American company in history. Shuanghui International paid $7.1 billion including debt for Smithfield Foods, the world's largest pork producer and processor. Overnight, a company founded as a single municipal slaughterhouse in 1958 controlled significant portions of both the Chinese and American pork supply chains.

Luohe is China's only nationally recognised Famous Food City, a designation from the China food industry association that no other city holds. The title understates the concentration. The city produces 25% of China's total pork output and handles 90% of Henan Province's pork exports. Meat processing, flour products, beverages, and fruit and vegetable processing form an industrial cluster that generates a combined GDP exceeding ¥123 billion. The annual Central Plain Food Festival, held consecutively for over twenty years, has facilitated 204 deals worth ¥321 billion since its inception in 2003.

The mechanism is keystone-species dominance through vertical integration. Shuanghui — now operating under parent company WH Group — did not merely grow large. It absorbed its supply chain. Raw material sourcing, slaughtering, processing, cold chain logistics, and retail distribution all happen within the same corporate organism. The Smithfield acquisition extended this integration across the Pacific: American hog farms now feed Chinese processing capacity, and Chinese consumer demand now sustains American agricultural employment. The interdependence is bilateral and deep.

Henan Province provides the enabling conditions. The province hosts over 70% of China's major food processing machinery suppliers. A new ten-billion-yuan food industrial park is under construction in Luohe's Yancheng district. The city opened an inland port specifically for imported meat, connecting Luohe's processing capacity to global protein supply chains. Each infrastructure investment makes the cluster harder to replicate elsewhere — the same preferential attachment dynamic that concentrates financial services in London or chipmaking in Hsinchu.

The biological analogy is the digestive system of an economy. Luohe takes in raw agricultural inputs from Henan's vast farmland, processes them through an industrial metabolism of slaughtering, curing, packaging, and distribution, and outputs finished food products to a national and increasingly global market. The city's economic function is literally to feed people — a role so fundamental that it becomes invisible until disrupted. Luohe controls more protein infrastructure than most countries, from a city that the world's food consumers have never heard of.

Key Facts

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