This study investigates the impact of the 2018 African Swine Fever (ASF) outbreak on China’s hog market, with a particular focus on the counterintuitive rise in supply during the early stages of the epidemic and the subsequent doubling of hog prices despite simultaneous supply-demand contraction. Using a simultaneous equation model with monthly data from 2012 to 2021, we find that panic selling, driven by compensation gaps of 75% of market value and disease risks, temporarily boosted short-term supply, with an elasticity of 0.29. However, reductions in breeding sows, with an 8-month delay, and the collapse of swine inventory later reversed this trend. Price surges occurred as supply contraction, with an elasticity of -0.32, outpaced demand decline, disrupting conventional market equilibrium. Notably, panic selling exacerbated ASF transmission, with an elasticity of 0.28, creating a self-reinforcing cycle where short-term supply increases deepened long-term shortages. These paradoxical outcomes highlight how biological lags in hog production and crisis-driven behaviors can distort market dynamics. The findings underscore the importance of adaptive policies, including real-time epidemic monitoring and risk-adjusted compensation schemes, to mitigate speculative behaviors and stabilize agricultural systems during health crises.