China Banks On Massive Pork Farms

BEIJING/SHANGHAI/REUTERS

A growing number of firms have laid out plans to build massive industrial-scale pig farms in China, the world’s largest pork consumer, as Beijing resumed a $2.5-billion-yuan subsidy to spur pig breeding and prevent future supply shocks.

China, the pork powerhouse of the world, produces some 50 million tonnes of pork each year and accounts for around 55 per cent of global pig production.

But despite its huge production, China’s pork sector is largely dominated by small family farms; with about 60 per cent of China’s 200,000 pig farms small-time breeders who produce fewer than 40 hogs each year.

Many backyard farmers are leaving the business following a disease outbreak in 2008 as well as steadily rising costs, a trend which has tightened supplies in China at a time of growing demand, causing a near 60 per cent jump in pork prices this year.

To drive down pork prices and to avoid price fluctuations in the longer term, the government is investing heavily in large-scale farming to feed its growing middle class that is consuming more meat.

Following are major players in China’s pig industry.

Guangdong Wen’s Foodstuffs Group Co. is the country’s largest hog breeder, producing 6.8 million hogs a year through its own production facilities and through contracts with some 8,000 household pig farmers.

New Hope Group is China’s top animal feed producer. 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.

State-run COFCO Co. Ltd. and Mitsubishi Corp. set up a joint venture last month to invest $1.5 billion on hogs, chicken-breeding and -processing facilities.

Shuanghui Group, which counts Goldman Sachs Inc. among its investors, is one of the largest pork processors in China with an annual slaughter capacity of more than 30 million pigs.

U.S.-based AgFeed Industries invested $18 million in China’s Jiangxi province to build five western model hog farms which would have an annual production capacity of 230,000 hogs in the first phase.

It currently owns 31 pig farms with an annual production capacity of 550,000 hogs.

Yurun Group, China’s second-biggest listed meat processor, has an annual pig slaughter capacity of 28.55 million head, but slaughtered only seven million in 2010.

Hunan-based Tangrenshen Group, a meat processor and livestock feed producer, slaughters 2.6 million pigs a year and produces 3.2 million tonnes of livestock feed.

Thailand’s CP Group has kicked off the construction of a 500,000-hogs-per-year pig farm in Shandong province. The firm is also building a one-million-pigs-per-year farm each in the provinces of Guangdong and Henan.

Henan’s Muyuan Foodstuff Co. Ltd. is planning to double its hog production to one million hogs per year after International Finance Corp. invested $10 million in the firm.

Chuying Agro-pastoral Co., based in the central Henan province, is investing four billion yuan to build a 400,000-hectare organic pig-breeding farm in Henan that would have an annual capacity of one million hogs a year. Its 2010 hog sales were 664,900.

Comments

explore

Stories from our other publications