With over 500 industry representatives, government officials, and members of the press in attendance, the 7th China Feed Industry Association Summit was held from November 29-30, 2011 at the Holiday Inn Changzhou Wujin in Jiangsu, China. It gave a comprehensive overview of the Chinese feed industry's impressive achievements, challenges and the technical means required to achieve its goals.
Jointly organised by China Feed Industry Association and Zhengchang Group, the summit has become a highly influential feed industry forum, where industry stakeholders exchange strategies, experiences, technical information and promote cooperation. The theme for the summit this year is: "Build a strong foothold, a shift in development approach, and improve the quality of growth."
An overview of China's feed and livestock industry's achievements for 2011 was given by deputy minister of agriculture and chairman of China Feed Industry Association, Gao Hongbin. Gao analysed the opportunities and challenges the industry will encounter in its next growth phase, as well as giving a detailed explanation of how he expects it to grow in the future. He noted that many companies were taking advantage of this China feed industry summit to study industry issues and make investment plans, effectively moving the industry on to a sustainable and environmentally friendly growth path.
Prior to the summit, China's state council released revisions to "Feed and Feed Additives Management Regulations" and the ministry of agriculture also announced China's "Feed Industry's 12th Five-Year Development Plan". In light of policymakers' new industry goals and regulations, the summit addressed the 12th Five-Year Development Plan's opportunities and challenges for the feed industry.
Despite facing difficulties presented by the current global economic situation and changes in China domestic economy, Gao pointed out that the livestock sector overcame obstacles and enjoyed healthy growth. China's 2011 feed output of 169 million tonnes is an increase of 4.3% as compared to 2010's 162.1 million tonnes. Although the prices of raw materials and overall production costs have risen significantly, industry profits are expected to exceed those of 2010, as healthy livestock farming profit margins boosted feed demand.
This feed output, though vast, is contributed by a large number of enterprises, many of which must still undergo consolidation to achieve economies of scale. In China, 283 feed companies have an annual output of above 100,000 tonnes of feed, 30 with above 500,000 tonnes, and 19 with above one million tonnes in 2010.
Compared to 2005 80% more companies produced over 100,000 tonnes of feed annually, 77% more produced at least 500,000 tonnes annually and 110% have production output of at least a million tonnes of feed yearly. At this time, companies with an annual feed output of more than 500,000 tonnes account for 43% of total domestic feed production. Clearly, much consolidation has occurred but more still has to happen; and feed demand is destined to undergo a profound increase over the next ten years.
Despite its achievements, speakers made clear that issues concerning feed supply, quality, safety and technology application are assuming increasing importance. To meet such challenges, Gao emphasised that, "We will raise the entry barrier, shift our approach to increase efficiency, and strengthen supervision to ensure feed safety." He added that, "In line with the new [feed industry] regulations, a series of new technical systems and requirements are needed for the production, management, and use of feed."
Gao urged that, "Integration should not only look at expanding scale, improving hardware, increasing market share or improving profit margins but more importantly, focus on improving quality, management and technology, as well as fulfilling social responsibility." He urged feed industry players to, "Forge ahead, in an effort to further promote sustainable and healthy development in livestock and feed industry."
Concrete steps were taken towards achieving such goals followed Gao's words: During the 7th China Feed Industry Association Summit, 163 companies signed a Letter of Commitment to ensure feed quality and safety by abiding with the new regulations. Large-scale, leading feed manufacturers that were signatories to this pledge included New Hope Group, Tongwei Group, Guangdong Evergreen Feed Industry Co Ltd, Guangdong Wens Group and Thailand-based CP Group (China).
Many industry stakeholders also visted Zhengchang's product centre, as the company featured many technically advanced, safe and environmentally friendly milling technologies. The highlight of the event was a ceremony in which Zhengchang handed over its largest pellet mill, SZLH1068 to Anhui Hewei Group.
SZLH1068 is capable of producing 160 tonnes of feed per hour, and was tailor-made for Anhui Hewei Group's one million-tonne production line. The successful development of SZLH1068 has laid a strong foundation for the China feed industry's development towards large-scale integration.
This Zhengchang-built, state-of-the-art feed making facility raises production scale while reducing required investment capital, processing time and management costs. It is a prototype project of the process technology, production capital and feed milling methods which will characterise the Chinese feed industry's transition to efficient, safe, traceable and cost-efficient mass production.
By presenting the industry's economic and regulatory challenges and offering solutions to such issues, this China feed industry summit provided a comprehensive analysis of the opportunities and investments which will sustain its flourishing development momentum in the years to come.