Yuanyuan ZHANG，Shim in SUN

College of Economics and Management，Shandong Agricultural University，Taian 271018，China

Shandong is a major producer of pig in China，and according to the data of China Statistical Yearbook（2013）and China Rural Statistical Yearbook（2013），the number of slaughtered fattened pigs in the province was 45.9987 million in 2012，and the pork production reached 3.7669million tons，both ranked fourth in the country；the output value of pig breeding industry was 1.24359 trillion yuan，accounting for 45.74%of the total output value of animal husbandry；the scale degree of pig breeding was 10 percentage points higher than the national average.

However，there is still a large gap between the pig breeding benefit in Shandong Province and the pig breeding benefit in major pig breeding provinces of China，directly affecting the economic interests of the pig farmers and pork consumers，and restricting the competitiveness improvement of the province's pig industry.How to reduce breeding costs and improve breeding efficiency has become a real problem which attracts the attention of provincial governments at all levels，scholars and the vast majority of pig breeding households.In recent years，using different methods，the scholars have studied the issues concerning pig breeding cost and benefit in different regions from different angles［1－6］，which is of important theoretical and practical significance.

However，there are shortcomings in the existing researches：

（i）They mainly perform the direct comparison and analysis of cost-benefit data，and it is difficult to scientifically and effectively deal with the comprehensive comparison of multi-classification and multi-regional pig breeding efficiency；

（ii）They focus on the analysis of single cost-benefit indicators of pig breeding，lacking in-depth analysis of factors influencing cost and benefit.

Based on previous studies，using the cost-benefit ratio and the time series of its influencing factors，this paper employs modified entropy weight-TOPSIS model to analyze the cost-benefit status of pig breeding in Shandong Province from the perspective of comparing it with that of the entire country and 9 other main pig producing areas，in order to seek effective ways to reduce the province's pig breeding costs and improve the pig breeding efficiency.

1 Selection of indicators and data sources

1.1 Selection of indicatorsBased on the ideas of DuPont analysis，the cost-benefit ratio of pig breeding is divided into two categories，namely output value and costs.From the data in National Agricultural Cost-benefit Data Compilation，it can be found that the output value of main products accounts for more than 99%of the total output value；in the total costs，the purchase price of piglet approximately occupies 25%，feed costs approximately occupy 55%，and the labor costs approximately occupy 15%.

Therefore，we select cost-benefit ratio and its influencing factors（including the output value of main products，the purchase price of piglet，feed costs and labor costs）as the indicators for the cost-benefit analysis of pig breeding.

1.2 Data sourcesThe analysis involves the related data about the entire country and 10 main pig producing areas，a total of 11 regions.According to the number of slaughtered fattened pigs in the period 2000－2012，Sichuan Province，Hunan Province，Henan Province，Shandong Province，Hebei Province，Guangdong Province，Guangxi Zhuang Autonomous Region，Hunan Province，Jiangsu Province and Anhui Province are 10 main pig producing areas in China，represented by 1 to 10，respectively；11 represents the entire country.

The data are about the cost-benefit ratio of small scale pig breeding，medium scale pig breeding and large scale pig breeding and its influencing factors in various regions.The statistics are from National Agricultural cost-benefit Data Compilation（2001－2013）.The breeding scale is determined based on the average number of slaughtered fattened pigs within one year（Q）：30＜Q≤100，small scale pig breeding；100＜Q≤1000，medium scale pig breeding；Q＞1000，large scale pig breeding.

2 The principle and building steps of modified entropy weight－TOPSIS model

2.1 The principle of modelUsing the cost-benefit ratio and time series of the main influencing factors，we perform the comparative analysis of the cost and benefit of scale pig breeding in Shandong Province，and its essence is the multi-goal comprehensive evaluation with years as indicators.Thus，according to the degree of indicator variability of each year，information entropy［7］is used to calculate the objective entropy weight of each year，and then the exponential smoothing method is used to modify the objective entropy weight of each year.Different from the direct cost benefit data，the entropy weight method can not only exclude the subjectivity during the weighting of year data，but also make full use of the information of the original time series data；after the objective entropy weight is modified using exponential smoothing method，the time series can more scientifically reflect changes in regularity.

The basis of comparative analysis is sorting.TOPSIS（Technique for Order Preference by Similarity to an Ideal Solution）is the sorting method similar to the ideal solution［8］.TOPSIS is based on the concept that the chosen alternative should have the shortest geometric distance from the positive ideal solution and the longest geometric distance from the negative ideal solution.

It is a method of compensatory aggregation that compares a set of alternatives by identifying weights for each criterion，normalizing scores for each criterion and calculating the geometric distance between each alternative and the ideal alternative，which is the best score in each criterion.An assumption of TOPSIS is that the criteria are monotonically increasing or decreasing.

Normalization is usually required as the parameters or criteria are often of incongruous dimensions in multi－criteria problems.Compensatory methods such as TOPSIS allow trade-offs between criteria，where a poor result in one criterion can be negated by a good result in another criterion.

This provides a more realistic form of modelling than non compensatory methods，which include or exclude alternative solutions based on hard cut－offs.

2.2 The building steps of modelTaking the cost-benefit ratio of small scale pig breeding for example，the building steps of modified entropy weight－TOPSIS model are illustrated，and other indicators are derived in a similar manner.

2.2.1 Normalization of the raw data.To eliminate the in commensur ability arising from the differences in dimension，order of magnitude，positivity and negativity of indicators for the cost-benefit analysis of pig breeding，we use the relative deviation method，and normalize the indicator values.

Let aij（i＝1，2，…，11；j＝1，2，…，12）be the raw data of cost-benefit ratio，and le

For the positive indicators，let

For the negative indicators，let

2.2.2 Determining of entropy weight.The first step is to calculate the entropy of cost-benefit ratio of small scale pig breeding in year j：

whereand if pij＝0，then it is stipulated that pijln pij.

The second step is to calculate the entropy weight of cost benefit ratio of small scale pig breeding in year j：

The third step is to use exponential smoothing method to correct the entropy weight：

where the initial conditions S1＝u1，and is the smoothing coefficient.

The fourth step is to normalize the corrected entropy weight：

2.2.3 Determining of the relative proximity.The first step is to normalize the weighted cost-benefit ratio：

The second step is to determine the positive ideal solution and negative ideal solution of cost-benefit ratio of small scale pig breeding.

Le…，12.We get the positive ideal solutionand negative ideal solutionof cost-benefit ratio of small－scale pig breeding.

The third step is to calculate the Euclidean distance of positive and negative ideal solution.

Letandbe the Euclidean distance of positive and negative ideal solution and cost-benefit ratio of small scale pig breeding in region i，respectively，then：

The fourth step is to calculate the relative proximity.

Let fibe the degree of relative proximity of cost-benefit ratio of small scale pig breeding in region i and positive and negative ideal solution，then：

If fiis greater，it indicates that the cost-benefit ratio of small scale pig breeding in the region is closer to the positive ideal solution and the cost-benefit status is better，and vice versa.

3 cost-benefit analysis of scale pig breeding in Shandong Province

3.1 cost-benefit analysis of small scale pig breedingTable 1 shows that the relative proximity of cost-benefit ratio of small scale pig breeding in Shandong Province and positive ideal point is 0.4049，15 percentage points below the national average，only 68.72%of that in Sichuan Province and 79.89%of that in Hunan Province，falling behind that in Hebei Province and Guangdong Province.

Thus it can be seen that the cost-benefit ratio of small scale pig breeding in Shandong Province is relatively small，with large space for improvement.The degree of relative proximity of the output value of main products of small scale pig breeding in Shandong Province and positive ideal point is far below the national average，and the former is69.85%of the latter.

The relative proximity of the purchase price of piglet is only 28.49%of the national average；the relative proximity of feed costs and labor costs is49.65%and 191.41%higher than the national average，respectively.

Overall，the feed costs and labor costs of small scale pig breeding in Shandong Province are low，but the significantly low output value of main products and significantly high purchase price of piglet contribute to the gap between the cost-benefit ratio and the national average.

In China's10main pig producing areas，the relative proximity of the output value of main products of small scale pig breeding in Shandong Province and the positive ideal points takes the 7th place，only 49.69%of that in Guangdong Province，and 60.55%of that in Hunan Province；the relative proximity of the purchase price of piglet ranks9th，only 31.19%of that in Hebei Province and 20.01%of that in Hunan Province；the relative proximity of feed costs takes the third place，30.75 percentage points lower than that in Sichuan Province，157.97 percentage points and 102.57 percentage points higher than that in Guangdong Province and Hunan Province，respectively；the relative proximity of labor costs takes the first place，0.8339，0.6208，0.3422 and 0.1839 higher than that in Sichuan Province，Hunan Province，Guangdong Province and Hebei Province，respectively.

Overall，compared with Sichuan Province，Hunan Province，Hebei Province and Guangdong Province，although the small scale pig breeding in Shandong Province has obvious advantages in labor costs and feed costs，the relative proximity of the output value of main products and the purchase price of piglet is significantly low.

Table 1 The relative proximity of cost-benefit ratio of small scale pig breeding and its influencing factors in various regions

3.2 cost-benefit analysis of medium scale pig breedingTable 2 shows that the relative proximity of cost-benefit ratioof medium scale pig breeding in Shandong Province is0.5726，25.6 percentage points higher than the national average，but 17.31 percentage points lower than that in Hebei Province.Thus it can be seen that the medium scale pig breeding in Shandong Province has significant advantages in cost-benefit ratio.

Table 2 The relative proximity of cost-benefit ratio of medium scale pig breeding and its influencing factors in various regions

The degree of relative proximity of the output value of main products of medium scale pig breeding in Shandong Province and positive ideal point is basically the same as the national average；the relative proximity of the purchase price of piglet is only 49.55%of the national average；the relative proximity of feed costs and labor costs is138.15%and 139.76%of the national average，respectively.

Thus，in the case of basically same output value of main products，high purchase price of piglet largely offsets the advantages of feed costs and labor costs in Shandong Province.

In China's10 main pig producing areas，Shandong Province ranks sixth in terms of the relative proximity of the output value of main products of medium scale pig breeding and the positive ideal point（overall low）.It ranks eighth in terms of the relative proximity of the purchase price of piglet，only 46.34%of that of Hebei Province and 54.97%of that of Sichuan Province.

It ranks fifth in terms of the relative proximity of feed costs，93.57%of that of Hebei Province and 90.41%of that of Sichuan Province.It ranks third in terms of the relative proximity of labor costs，101.37%of that of Hebei Province and 228.92%of that of Sichuan Province.

Based on the above analysis，compared with Hebei Province and Sichuan Province，the relative proximity of the output value of main products and labor costs of medium scale pig breeding in Shandong Province is significantly high，but the relative proximity of the purchase price of piglet is significantly low，and the relative proximity of feed costs is also low.

Therefore，Shandong Province ranks third in China's10main pig producing areas（after Hebei Province and Sichuan Province）in terms of the relative proximity of cost-benefit ratio of medium scale pig breeding.

3.3 cost-benefit analysis of large scale pig breedingThe data in Table3 show that the relative proximity of cost-benefit ratio of large scale pig breeding in Shandong Province is 0.5578，significantly higher than the national average，74.12%of that in Hebei Province.

Table 3 The relative proximity of cost-benefit ratio of large scale pig breeding and its influencing factors in various regions

This suggests that the cost-benefit ratio of large scale pig breeding in Shandong Province is relatively high，in line with the status of major pig breeding province，but there is still much room for improvement.

Compared with the national average，the relative proximity of the output value of main products of large scale pig breeding and positive ideal point in Shandong Province is significantly low，and the former is68.31%of the latter.

The relative proximity of the purchase price of piglet is significantly low，56.43%of the national average，and the relative proximity of feed costs and labor costs is significantly high，136.27%and 137.62%of the national average，respectively.

Therefore，the significantly low output value of main products and significantly high purchase price of piglet obviously weaken the advantages of feed costs and labor costs.

In China's10 main pig producing areas，Shandong Province ranks seventh in terms of the relative proximity of the output value of main products of large scale pig breeding and the positive ideal point.It ranks ninth in terms of the relative proximity of the purchase price of piglet，40.36%of that of Hebei Province and 64.86%of that of Sichuan Province.

It ranks third in terms of the relative proximity of feed costs，2.55 percentage points higher than that of Sichuan Province，but 9.31 percentage points lower than that of Hebei Province.It ranks second in terms of the relative proximity of labor costs，130.21%of that of Hebei Province and 113.43%of that of Sichuan Province.

On the whole，compared with Hebei Province and Sichuan Province，although the output value of main products and labor costs of large scale pig breeding in Shandong Province have a great advantage，but the advantage of feed costs is not significant and the disadvantage of purchase price of piglet is significant.

3.4 Analysis of constraint on the cost and benefit of pig breeding in Shandong ProvinceBased on the foregoing analysis，the significantly low output value of main products and significantly high purchase price of piglet largely offset the advantages of feed costs and labor costs，becoming the two bottlenecks restricting the improvement of cost-benefit ratio of scale pig breeding in Shandong Province.The output value of main products of pig breeding in Shandong Province is low.

On the one hand，the overall yield of main products in Shandong Province is low，and there is a gap between it and the overall yield of main products in Sichuan Province，Hunan Province and Hubei Province.The reasons are as follows：

（i）The pigs mostly have local pig gene，the pig weight peak occurs early and lasts for a short time，and the weight of pigs suitable for slaughter is small；

（ii）The degree of pig breeding scale is high，and it emphasizes the rational breeding density and breeding space，unsuitable for the breeding management of large size pigs；

（iii）Relying on a large long-distance market demand，the large size pigs are not suitable for long-distance transport.

On the other hand，there is a certain difference between the pork price in Shandong Province and the pork price in Sichuan Province and Hunan Province.The reasons are as follows：

（i）Shandong Province is an important grain production base，and the feed costs are low，so the profit margins are large for pig raisers；

（ii）In the pig market，the supply exceeds the demand overall，so there is limited space for the increase in pork price；

（iii）Shandong Province is a major pig source，and the pork price difference is bound to exist between Shandong Province and some regions such as Guangdong Province and Shanghai City.

The reasons for high purchase price of piglet in Shandong Province are as follows：

（i）In the period 2005－2010，since both the number of pigs on hand at the end of year and the number of sow which can breed constantly declined，the piglet supply was reduced，while as pig price continued improve，there was an increased demand for piglets；

（ii）The annual production capacity of sows is low，affecting the overall supply of piglets；

（iii）There are an increasing number of pig raisers who produce and raise pigs by themselves，but this breeding pattern has a long cycle，and the piglet survival rate decreases.

4 Conclusions and recommendations

4.1 ConclusionsThe results show that compared with the national average，the cost-benefit ratio of small scale pig breeding in Shandong Province is lower，while the cost-benefit ratio of medium scale and large scale pig breeding is significantly improved；the cost-benefit ratio of small scale pig breeding in Shandong Province is basically the same as that in 9 other main pig producing areas，while the cost-benefit ratio of medium scale and large scale pig breeding is higher；the output value of main products and the purchase price of piglet are two major bottlenecks restricting the cost benefit improvement of scale pig breeding in Shandong Province.

4.2 RecommendationsBased on the above conclusions，we put forth the following policy recommendations for improving the cost-benefit ratio of scale pig breeding in Shandong Province：

4.2.1 Striving to improve the management level of breeding and promoting the output value of main products of pig breeding.It is necessary to continue to subsidize the fine pig breed to promote breed improvement of pigs and enhance the feed conversion rates and productivity；introduce advanced feeding facilities and scientific management methods to ensure healthy and safe breeding environment，and reduce the growth and spread of disease；strengthen the pork reserve，and reasonably regulate the market to ensure the effective supply of pigs，stabilize pork prices and improve the output value of main products.

4.2.2 Increasing the number of sows on hand and improving the farrowing rate to reduce the purchase price of piglet.It is necessary to implement the sow subsidies and other support policies to stabilize the number of sows on hand and guarantee the piglet supply；accelerate the research and development of pig breeding techniques to promote the farrowing rate of sows and survival rate of piglets；increase the collection and dissemination of market information，to accurately grasp the supply and demand information and price early warning of piglets.

4.2.3 Strengthening the guidance and support to vigorously develop medium and small scale pig breeding.It is necessary to increase the support of the government and relevant departments to give broad support in areas such as funding，space and technology to create a good environment for industrial development；effectively stabilize the cost and benefit of pig breeding，and develop the special policies or subsidies to ensure the basic earnings for medium and small scale pig breeding；adjust the structure of pig breeding，expand the proportion of medium and small scale pig breeding，enhance its ability to respond to market and improve the efficiency of pig breeding.

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