Three young pigs look up drowsily from a spotless sty as Chen Chunfu, tobacco pipe in hand, works out in his head their price three months from now.

They will need to gain a hundred more pounds before they can be sold, each pound helping to put his 15-year-old son through school.

''I can't afford to lose money on them,'' Chen said from his spartan home in Peach Blossom Ravine in Sichuan province, where a deadly bacteria has killed hundreds of hogs and nearly 40 people.

Chen relies on pigs for a fifth of his income of less than US$500 (HK$3,900) a year. He uses them to fertilize a hillside orchard hours away from the epicenter of an outbreak of the streptococcus suis bacteria which has sickened hundreds of farmers, butchers and others who came in contact with the infected animals.

Sichuan, which supplies 14 percent of the mainland's favorite meat, has been forced to suspend all exports of chilled and frozen pork from hard-hit areas to Hong Kong. Many mainland cities have set up tight screens to block shipments of pork from the province.

It is China's biggest disease outbreak since the deadly flu-like SARS virus emerged in the south in late 2002, and went on to kill about 800 people around the world.

It could not have come at a worse time for Sichuan, which is better known for its fiery-hot chili and rare pandas. Even before the outbreak of the disease, pork prices were headed south due to oversupply.

Now, measures to curb the disease's spread from the impoverished agrarian province - home to about 90 million people - threaten to slice through already paper-thin margins for pig farmers such as Chen. ``They've made a big effort in education, telling people not to eat pigs that died of this,'' said Chen at his mud home overlooking the city of Longquan, outside Sichuan's provincial capital of Chengdu.

He said he did not slaughter his pigs and his family would not eat one that died of sickness.

``But some people do, for a lot of reasons. Maybe they eat it or give it to friends and relatives, because for the most part you can only sell the good meat. The friend can't really refuse, but eating it isn't sanitary either.''

The mainland consumes more pork than anywhere else in the world.

Pig-raising used to be profitable in the country as consumption of meat grew further on growing incomes in urban and coastal areas, according to Zhu Yufeng, Beijing representative for trading company Louis Dreyfus.

But oversupply and higher feed costs have soured margins in recent months. ``From June, pig farmers have been barely making it, especially in Sichuan and the southwest,'' Zhu told a conference in Beijing last month.

For Chen, 52, and his wife Liu Faying, 51, a 25 percent drop in pork prices could eat into the family income of 3,000 yuan (HK$2,876) to 4,000 yuan a year. ``Let's say you could sell a four-month-old pig for four yuan a pound, now it's about three yuan a pound,'' Liu said. ``And you can't sell as many.''

For other farmers in the hardest-hit areas of Ziyang and Neijiang on the highway between Chengdu and Chongqing, pigs make up more than half the family income, state media has said.

Other income comes from raising vegetables and corn in small plots in the low green hills, and from wages sent home by family members working in more prosperous cities.

Peasant households with 20 or fewer pigs account for about 70 percent of hogs raised in Sichuan. ``My wife's family raises over 100 hogs. We've been inspected every day since the outbreak and we do all the things we're supposed to in terms of sanitation and inoculation,'' said Xiao Wang.

Few other farmers have the capital to raise 100 or more pigs, said Huang Guogang, operations and management department secretary for feed company Southhope Industry, a unit of mainland conglomerate New Hope Group.

``So many households raising pigs keeps margins down and makes it very difficult to establish more industrial farms,'' he said.

``As more people move to the cities and wealth spreads to the countryside, fewer households would be willing to enter such a high-risk, low-return business, creating more room for industrial pig farming to take hold.''