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Factbox: China's voracious appetite spurs farm expansion
By Niu Shuping
Fri Apr 20, 2012 12:07am EDT
(Reuters) - A growing number of companies have laid out plans to build or expand pig and chicken farms in China to meet rising demand in the world's second largest economy.
Massive centralized farm operations are opening up all over the country, replacing millions of small-scale backyard breeders -- a shift that has spurred a need for better breeding stock.
China produces an estimated 50 million metric tonnes of pork each year and accounts for nearly 55 percent of global pig production. To avoid price fluctuations, and deal with growing food safety concerns among consumers, the Chinese government is encouraging and investing heavily in a Westernized style of large-scale farming.
Here are some of the leading players in China's pork industry, as well as their latest expansion plans.
AGFEED INDUSTRIES FEED
The U.S-listed company has reportedly been aggressive in its efforts to take over and expand its pig farms in the provinces of Fujian, Hainan, Hunan, Guizhou and Jiangsu, on the heels of bolstering its annual hog production to 600,000 animals in the Jiangxi province this year. The firm, also a major animal feed producer, set up a joint venture with Hypor, B.V., part of the Hendrix Genetics Company in China. The company aims to boost its hog sales to more than 2 million hogs per year.
CHUYING AGRO-PASTORAL CO
The company, based in the central Henan province, recently announced plans to invest 450 million yuan to build hog processing and breeding centers in the north province of Henan.
Other expansion plans include constructing a swine slaughterhouse in Henan. The company sold 720,900 piglets and 267,900 hogs in 2011.
COFCO
The state-run trading company plans to invest 3.5 billion yuan on 60-million-chicken breeding and slaughtering facilities and swine breeding farms in the southwest province of Sichuan this year. It set up a joint venture last year with Mitsubishi Corp to invest $1.5 billion on hog, chicken breeding and processing facilities.
COFCO, which holds a minority stake in world's largest hog processor Smithfield Foods, has said it aims to be the largest pig farmer in China and produce 10-15 million hogs per year by 2015, up from the current annual rate of 1.5 million.
The firm has announced plans to invest over 20 billion yuan to set up three pig farming bases in Tianjin, Jiangsu and Wuhan, with each expected to produce three million pigs annually.
CP FOODS
The Thailand-based group has started construction of a 3.6-billion-yuan breeding and slaughtering facility in central Hubei province which, by year's end, will have the capacity to annually process one million hogs.
The company has also built breeding and slaughtering facilities in Shandong; a one-million hog farm in the central province of Hubei last year; and one-million-hog and 100-million-chicken farms in the southern province of Guangdong.
GUANGDONG WEN'S FOODSTUFFS GROUP CO.
Wens, the country's largest hog breeder, produced 777 million chickens and 6.64 million hogs in 2011 at its own facilities and through contracts with some 52,000 farmers.
The company plans to build farms to house 30 million broilers and 300,000 hogs a year in the central province of Anhui. It also announced last year that plans were in place to build two hog farms in the southwest province of Sichuan, each with 1 million heads.
The company, based in the south province of Guangdong, is also eyeing expansion efforts in the country's northeast provinces, with hopes to raise five to six million hogs a year.
HUNAN TANGRENSHEN (TRS) GROUP CO LTD
The company - a major genetic breeder and livestock feed producer - processes 2.6 million pigs a year and produces 3.2 million metric tonnes of livestock feed in 2011. The group has signed a joint venture with U.S. swine genetics company Whiteshire Hamroc, whereby the Indiana-based breeder would supply genetically selected pigs to help Tangrenshen eventually produce 10 million pigs per year.
NEW HOPE GROUP
China's top animal feed producer, New Hope Group, said it plans to build more pig farms to expand its annual hog production by three million in the next three years to tap growing domestic demand.
New Hope's chairman, Liu Yonghao, told Reuters that large-scale commercial breeding would take 70-80 percent of the market in the coming five to 10 years.
MUYUAN FOODSTUFF CO. LTD.
Muyuan Foodstuff, one of the leading hog breeders in China, runs more than 20 pig farm operators and aims to be producing six million hogs by the year of 2015.
Last May, the company started operation of breeding and slaughtering facilities with 1.5 million hogs a year in the central province of Henan.
SHUANGHUI GROUP
Shuanghui, one of the country's major hog processors, has an annual slaughter capacity of more than 30 million pigs, but only processed about one-third of that capacity last year. The company is currently investing in its own hog production after a tainted-meat scandal in 2011.
YURUN GROUP
Yurun, one of major meat processors, had an annual pig slaughter capacity of 46.05 million hogs by the end of 2011 and aims to reach 70 million heads per year by 2015.
(Reporting By Niu Shuping; Editing by Alden Bentley)
