Pig International - November 2012 - 13

| 13
One of the pig units set up by the
DaiBeiNong group at Huixian in the
Henan province in China. A number
of the country's leading processors are
now setting up their own pig production
units to help them establish vertically
integrated operations.

Read more...
about China's pig industry. See
"Chinese pork consumption
continues to grow" at
www.WATTAgNet.com/147225.html

to grow in line with incomes, any
visitor to the country can see that
food safety is of growing concern
and several recent health-scare food
scandals have resulted in shortterm declines in consumption.
But this has not reduced the
confidence of Chinese businessmen
who own large commercial pig units and
are buying modern equipment to replace
their traditional labor forces because of
steadily rising wages. They discovered
that automatic pig feeding systems are
more accurate and lead to less waste
than when pigs are fed by hand.
In addition, a number of the country's
leading processors are now setting up
their own pig production units to help
them establish vertically integrated

November/December 2012 | www.WATTAgNet.com

operations. They include Wen's Group,
CP Group, Zhengbang Technology Co.,
Muyuan Foodstuff Co. and the Chuying
Agro-Pastoral Group. All have farms with
more than 500,000 pigs. The COFCO
Group, Shandon Liuhe Group and AgFeed
have farms with more than 100,000 pigs.
In the case of Wen's, which is producing
7 million pigs per year, the company
breeds the pigs and they are bought
and finished by contracted producers,
with feed being provided by Wen's.
On the processing front, the
major national players are Shineway,
Yurun and People's Food. Despite
fears of problems with over-capacity
in slaughtering, the entrepreneurial
Shineway plans on slaughtering
between 45 million to 55 million
pigs by the end of 2012. Yuhun
announced that it will be able to
slaughter 70 million pigs by 2015.
The move away from small pig
units started in China in 2007 when
many of the backyard farms were
hit far harder by disease than the
larger units, because of sanitation
and a lack of proper management.
Backyard pig producers were also more
susceptible to variable input costs and
market volatility and they were less
competitive than the larger units.
In 2008, China became a net
importer of pork, mainly because of
internal supply shortages, importing
pig meat from the U.S., Brazil,
Denmark and the United Kingdom.

Pork imports temporary
A recent Rabobank report found
that although China has increased
its pork imports in recent years, this
is a temporary strategy rather than
a long-term one because Chinese
consumers prefer fresh pork rather
than imported frozen product.
Additionally, China's cost of pig
production is currently one of the
highest on the planet, because of low
productivity (the national output is less
than 15 pigs per sow per year) and poor
feed conversion. If the current moves to
upgrade the quantity and quality of pig
production are successful, the country's
demand for pork imports could fall,
concluded the report, but it added:
"If China could improve its corn
yields and swine FCR towards U.S.
levels, its goals of self-sufficiency are
mathematically achievable. However,
there are many challenges in achieving
this success, such as the continuation of
disease and food safety issues, as well
as logistics. If China does not import
pork, we believe that all indications
are that it will need to import corn
... how much of each will depend on
improvements in the supply chain." PIGI
Ref: Rabobank Industry Note September 2012.
"Industrialization of China's Pork Supply Chain."

Stuart Lumb is a UK-based freelance writer. He
can be reached at stuart@lumb.karoo.co.uk.


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Table of Contents for the Digital Edition of Pig International - November 2012

Contents
Pig International - November 2012 - Cover1
Pig International - November 2012 - Cover2
Pig International - November 2012 - Contents
Pig International - November 2012 - 2
Pig International - November 2012 - 3
Pig International - November 2012 - 4
Pig International - November 2012 - 5
Pig International - November 2012 - 6
Pig International - November 2012 - 7
Pig International - November 2012 - 8
Pig International - November 2012 - 9
Pig International - November 2012 - 10
Pig International - November 2012 - 11
Pig International - November 2012 - 12
Pig International - November 2012 - 13
Pig International - November 2012 - 14
Pig International - November 2012 - 15
Pig International - November 2012 - 16
Pig International - November 2012 - 17
Pig International - November 2012 - 18
Pig International - November 2012 - 19
Pig International - November 2012 - 20
Pig International - November 2012 - 21
Pig International - November 2012 - 22
Pig International - November 2012 - 23
Pig International - November 2012 - 24
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Pig International - November 2012 - Cover3
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