China Animal Husbandry and Veterinary Daily: During the 13th Five-Year Plan period, the number of feeding enterprises may be reduced to about 3000.
Reporter: In 2015, China's total feed output exceeded 200 million tons. How do you view this data? What is the overall development of the feed industry in 2015 and what problems need to be solved urgently?
Qi Guanghai, Director of Feed Research Institute, Chinese Academy of Agricultural Sciences: In 2015, China's total feed output reached 218 million tons (197 million tons in 2014). This is the second largest feed output in the world since 1991 and the first in the world in 2011, ranking first in the world continuously. It has also been hovering 190 million tons since 2012, and finally broke through the 200 million tons barrier. This shows that the popularization rate of industrial feed in China has been further improved. As there are still a considerable amount of premixed feed and concentrated feed additives in the 218 million tons, there is still much room for industrial feed production to improve with the acceleration of the standardization and scale-up process of the aquaculture industry.
On the surface, the above achievements can be seen in three aspects: firstly, the output of some provinces and cities has increased, for example, the feed output of Anhui Province in 2015 was 5.42 million tons, an increase of about 5% compared with 5.1596 million tons in 2014; secondly, the output of some large enterprises has increased greatly; thirdly, the feed output of Broilers and laying hens has increased significantly (7% and 2%). The fundamental reason is the guidance of the national industrial policy, the withdrawal of small-scale farmers and the acceleration of the growth of large and medium-sized farms, which make the application of formula feed more popular and the application of concentrated feed and premixed feed with additives reduced.
The overall development of the feed industry in 2015 is good. Soybean meal, corn, fish meal and other feed raw materials have lower prices. The number of feed enterprises has further decreased. Small and medium enterprises have shrunk, the growth of medium-sized enterprises has slowed down, and large enterprises have generally entered a new normal, stable and better. Although the output of feed has increased substantially, there are still some restrictive factors: lack of feed resources and dependence on import of protein feed; unclear content of raw materials and available nutrients, and the need to establish a corresponding database; the effectiveness and safety of additives need to be evaluated accurately and objectively, and a corresponding shared database needs to be established; and the exact nutrition needs of feeding animals need to be further developed. To clarify and improve, it is necessary to establish dynamic database, and the integration and sharing of environmental protection and functional feed technology need to be strengthened. All of these require people of insight in the industry to work together, plan together and tackle key problems.
Reporter: In 2015, feed enterprises further reduced and small feed enterprises quickened withdrawal. What factors contributed to this process, capital, technology, or marketing?
Qi Guanghai: At the end of 2012, 2013 and 2014, the number of enterprises licensed for feed production in China was 10858, 10113 and 7061, respectively. In 2015, the number dropped further to more than 6,000. The reasons are as follows: First, the intensive development of aquaculture has further accelerated the elimination of small enterprises with backward technology, quality, after-sales and brand. Secondly, the WTO commitment has increased the import of pork, milk powder, chicken and other animal products in China, which has led to the gradual withdrawal of some enterprises with high*breeding cost, low benefit and high risk. In 2015, about 5 million farms (households) withdrew from the market, so small feed enterprises that depend on small farms (households) for survival withdrew from the market. Third, the popularity of the Internet has made it possible to sell directly and on-line. Winning by quantity, making small profits and selling more, has further occupied the living space of small feed enterprises with backward technology and insufficient funds. Fourthly, the industry regulations are sound and the supervision is strengthened, which makes many small feed enterprises have to withdraw. During the 13th Five-Year Plan period, the number of feed enterprises in China will probably be further reduced to about 3000 and stabilized to 2000-3000.
Reporter: The Central Economic Work Conference held at the end of 2015 clearly calls for inventory removal, cost reduction, shortage board, etc. to promote supply-side reform. How do we understand this from the perspective of China's feed industry?
Qi Guanghai: "De-stockpiling" is manifested in the feed industry as "de-productivity and optimizing productivity". Through policies, feed unsafe factors are reduced to the lowest level, such as the withdrawal of small feed factories; because feed enterprises have always been prevalent in the lowest cost formula; "cost reduction" is a difficult point, and efforts should be made in the "best benefit formula" to make the livestock products produced "cost reduction", involving feed. Evaluation of raw materials and additives, nutritional needs of animals and other issues; "filling board", "standardization of effective utilization of feed materials, feed safety, animal health, technological innovation, enterprise and government management, etc. From the point of view of supply-side reform, the supply target of feed industry is aquaculture, and the production target must be oriented by the current and future development demand of aquaculture industry.
In fact, during the Twelfth Five-Year Plan period, the feed industry undertook the task of reducing production capacity and cost. In 2015, more than 30% of SMEs were eliminated, production capacity was increased, product quality and safety level were improved, etc. China's feed industry is entering a period of low-speed growth. Excess capacity and difficulty in making profits are plaguing the further development of the feed industry. To solve this difficulty, we must carry out structural reform in the feed industry.
Reporter: So in terms of innovation-driven development, what are the technological innovation directions of China's feed industry?
Qi Guanghai: To answer this question, we should first understand the main technical problems facing the sustainable development of China's feed industry: first, the regulation mechanism of nutrient metabolism in animal growth and development, the physiological determinant mechanism of animal product quality and the digestion, absorption and metabolism of key nutrients need to be further studied; second, the shortage of feed resources, and the utilization efficiency of existing resources need to be further improved. Thirdly, the hidden danger of feed safety still exists, especially the serious dependence on feed drugs and the lack of them.