Profiles of the Chinese Pig Industr
Nomatterwhomyouask,theanswerwillbethesame:eyearof2000,527millionheadsofpigswereslaughtered,andnearly50%ofallporkintheworldisnowproducedinChina(NBSC,FAO,USDA,2002).1.3billionconsumersseemtopreferporkoveranyothermeatsintheirmeals-essentiallyallporkproducedinthecountryisconsumeddomestically.
Dependingonwhomyouask,1999,asurveyconductedbyNBSC(NationalBureauofStatisticsofChina)revealedthathouseholdsinruralChinaraisedanaverageof1.48pigs(NBSC,2000)herfrequentlyquotedstatisticisthatabout80percentofallChinesepigsareproducedinthebackyardsoffarmers’ntreportspreparedin2002byhogindustryassociationsinZhejiang,Shanghai,Beijing,andGuangdongprovincesproposedthat40to50percentofthehogswereproducedon‘scalefarms’inthoseprovinces.,itisdifficulttopreciselydefinea‘scalefarm’arethecorrectnumberstodescribetheprofiles?Therealitymaybesimple:therehasbeennosoundandcomprehensiveinvestigation/surveyaccomplishedsofarinordertoaccuratelyprofiletheindustry.
IncreasingmarketopennessinferredbyChina’saccessiontotheWorldTradeOrganization,continuedincomegrowth,andtheshiftoffoodconsumptionpatternstowardsmoremeathaveattractedmoreandmoreattentionsfromtherestofworldonChineseporkindustry.
actorsandissueswillaccordinglybestressedtoillustratewhatdifferentiatestheChinesepigindustryfromothercountries’andwhatdirectiontheindustryisheadinginforthefuture.
Case1:-StrugglingBackyardProducers
ndherhusbandre-builttheirhouseinruralShandongProvincesatleastsixtimesinthelast40years.
InthoseverydifficultyearsamidtheCulturalRevolution,grain(mainlywheat)ingapigtwoorthreetimesayearallowedforthepurchasesofotherfoodsinreturn.
’s2-pigFarm.
ItemsNote
erPigs-boughtfromlocalbazaarsatabout15to23Kgandabout$0.85/anbedeferredasshort-termdebt.
-onlyabout10%ofthefeedisgrain,proteinmeals,andpremixes;feedlittlegrainatearlyandlatestage.
tomarket-about200daysfrom20Kgto65Kg.
weightpricevariesfrom$0.65to$0.80/Kgin2002.
re-storedinaopenpitforfieldapplicationConsideredtohavevalue
r&Vets-timeusedforbuyingandsellingpigsandcleaning;vetsanddrugscostabout$portunitycostforlaborincluded
’s2-pigOperation,
June30,2002
ItemsAmount,USDItemsAmount,USD
AssetsLiability
Current
Cashforfeedandvets42Shorttermdebtforfeederpigs19
4%premixandotherfeedinstore9Taxespayable4
Fixed
Pigshed,trough,andtools133
Pigs77
Totalequity238
’2-pigOperation,December31,2002
ItemsAmount,USDNote
Revenues
Pigssold141.53pigssoldayear
Manurecollectedforfertilizeruse29Opportunitycost
Expenses
Buyfeederpigs21.5
Grainandproteinmeals13.88%offeed
Premixes2.85Kgtotal
Labor65Normallynotincluded
Vetsanddrugs7.3
Others6.5
Depreciation2.7
Netincomebeforetaxes&nb
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