The aquaculture industry has entered a stage of decapacity, and the demand for feed has reached a peak!

The aquaculture industry has entered a stage of capacity reduction, and feed demand will usher in a peakcDE China Feed Industry Information Network-Based on feed, serving animal husbandry

This year, the supply and demand of agricultural and animal husbandry products such as pigs and corn have differentiated.

The aquaculture market enters the stage of capacity reductioncDE China Feed Industry Information Network-Based on feed, serving animal husbandry

Jin Yuxi, Purchasing Director of Oriental Hope Group Co.

"Now live pigs and meat and poultry have entered a loss cycle, and they are all facing the problem of

Similarly, the meat and poultry market is also facing capacity reduction

Regarding the pig price trend in the later period, Wang Zuli, an associate researcher of the Institute of Agricultural Economics and Development of the Chinese Academy of Agricultural Sciences and chief expert of the pig industry monitoring and early warning of the Ministry of Agriculture and Rural Affairs, believes that with the continuous recovery of production capacity, there will be more market supply next year, superimposing the off-season consumption.

Domestic feed demand will usher in a peakcDE China Feed Industry Information Network-Based on feed, serving animal husbandry

In a period when the stock of live pigs and meat and poultry is so large, domestic feed demand will usher in a peak

The substantial increase in feed demand has driven the increase in domestic feed grain, especially the increase in corn imports

Such a large import has caused market concerns about domestic food prices.

The data shows that at the end of August, domestic grain-using companies’ corn and wheat purchase prices increased by 20% and 8% year-on-year respectively; the price of rice rose little, and the prices of early indica rice, mid-late indica rice and japonica rice rose by 6.

Li Xigui, director of the Grain and Oil Monitoring Division of the National Grain and Oil Information Center, believes that the grain output in 2021 will remain above 650 million tons for seven consecutive years.

Opportunities and challenges for the development of feed breeding industry under the new situationcDE China Feed Industry Information Network-Based on feed, serving animal husbandry

Regarding the development of the feed aquaculture industry, Xiao Guoshun, vice president of Jiangsu Heyouruian Agricultural Development Co.

In view of the follow-up situation of the pig industry, Guo Jian, assistant to the president and director of the operation center of Dabei Agricultural University, believes that in the short term, the situation of the pig industry will be in a significant downward trend.

Lan Renxing, deputy general manager of the feed supply chain management department of New Hope Liuhe Co.

Liu Shijie, head of the agricultural product department of Zhejiang Hangshi Shancheng Industrial Co.

Zhang Yuchuan, deputy general manager of Yinhe Futures, said that the core issue of risk management for feed breeding enterprises is the control of feed procurement, cost and sales prices of livestock, that is, how to reduce procurement costs and increase sales prices

　　This year, the supply and demand of agricultural and animal husbandry products such as pigs and corn have differentiated.
In particular, the aquaculture industry has experienced tremendous pressure to reduce production capacity
.
The "2021 China Agriculture and Animal Husbandry Industry (Derivatives) Conference" held on September 23 focused on the latest developments in the breeding and feed industries
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　The aquaculture market enters the stage of capacity reductioncDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Jin Yuxi, Purchasing Director of Oriental Hope Group Co.
, Ltd.
, estimates that the entire aquaculture market has entered a stage of capacity reduction
.
At present, the domestic supply of live pigs may exceed 700 million; the scale of meat and poultry is about 16 billion, which is 3 billion more than the balance point
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　"Now live pigs and meat and poultry have entered a loss cycle, and they are all facing the problem of
reducing production capacity .
" Jin Yuxi said that if calculated by referring to the 45 million sow data released by the Ministry of Agriculture and Rural Affairs in July, the domestic supply of live pigs may exceed 700 million.
This means that the price of live pigs will face great pressure in the next period of time
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Similarly, the meat and poultry market is also facing capacity reduction
.
China's meat and poultry balance point is around 13 billion.
Due to the surge in domestic live pig prices in 2019, meat and poultry quickly make up for the shortage of live pigs.
Meat and poultry have remained at around 16 billion in the past two years.
The recovery of live pigs will compress the price of meat and poultry
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Regarding the pig price trend in the later period, Wang Zuli, an associate researcher of the Institute of Agricultural Economics and Development of the Chinese Academy of Agricultural Sciences and chief expert of the pig industry monitoring and early warning of the Ministry of Agriculture and Rural Affairs, believes that with the continuous recovery of production capacity, there will be more market supply next year, superimposing the off-season consumption.
The pig price in the first half of next year is not optimistic, but it may not necessarily be as pessimistic as everyone expected
.
There are three major changes that need to be paid attention to.
First, the current pig breeding has been losing money for three consecutive months, and the industry's production capacity has begun to adjust under the expectation of low pig prices in the future.
Normally, the production capacity adjustment will be accompanied by the pig stock.
In this way, if farmers remove all the pigs that should be slaughtered before the Spring Festival, the number of commercial pigs that can be listed after the Spring Festival may not be as large as we expected
.
Second, the slaughter weight of live pigs in the first half of next year will certainly not reach a high level again.
In addition, the supply of imported pork is likely to decrease significantly in the first half of next year
.
Third, the epidemic situation will generally improve after the Spring Festival, and consumption may recover after the Spring Festival next year
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Domestic feed demand will usher in a peakcDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　In a period when the stock of live pigs and meat and poultry is so large, domestic feed demand will usher in a peak
.
Statistics show that from January to August this year, the total national feed output reached 190 million tons, an increase of 19.
1% year-on-year, of which pig feed output increased by 62.
6% year-on-year
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　The substantial increase in feed demand has driven the increase in domestic feed grain, especially the increase in corn imports
.
According to data released by the General Administration of Customs, from January to August 2021, approximately 21.
4 million tons of corn were imported, an increase of approximately 283.
7% compared with the same period last year
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Such a large import has caused market concerns about domestic food prices.
At the end of August, the UN Food and Agriculture Organization's global grain price index rose by 31.
1% year-on-year
.
However, compared with the international market, although the prices of China's four major staple foods have risen, the overall increase is limited, but the price of corn has increased significantly year-on-year
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　The data shows that at the end of August, domestic grain-using companies’ corn and wheat purchase prices increased by 20% and 8% year-on-year respectively; the price of rice rose little, and the prices of early indica rice, mid-late indica rice and japonica rice rose by 6.
1% year-on-year, 0.
8% and 0.
8% respectively.
Fell 4.
4%
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Li Xigui, director of the Grain and Oil Monitoring Division of the National Grain and Oil Information Center, believes that the grain output in 2021 will remain above 650 million tons for seven consecutive years.
The country's grain stocks are abundant, and there is still a solid foundation for the smooth operation of the grain market
.
Due to the harvest of autumn grains, the continuous release of policy grains, and the effective measures to ensure supply and price stability, domestic grain prices are expected to remain stable in the future
.
However, Li Xigui also emphasized that it should also be noted that the high international grain prices will inevitably have a certain impact on the domestic market, and that the prices of corn and other varieties are expected to be affected by factors such as increased demand and a significant increase in the cost of land rent and fertilizers.
There will still be some upward momentum in 2022
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Opportunities and challenges for the development of feed breeding industry under the new situationcDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Regarding the development of the feed aquaculture industry, Xiao Guoshun, vice president of Jiangsu Heyouruian Agricultural Development Co.
, Ltd.
, said that since the African swine fever, the feed aquaculture industry has shown a trend of centralized production capacity and large ones
.
From the perspective of the breeding industry, after the African swine fever, the domestic market will face the concentration of the breeding industry and the feed industry on the one hand, and the integration of the upstream and downstream industrial chains of the two industries on the other hand
.
It is also worth noting that automation, intelligence, and data are also changes in the future industry trends
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　In view of the follow-up situation of the pig industry, Guo Jian, assistant to the president and director of the operation center of Dabei Agricultural University, believes that in the short term, the situation of the pig industry will be in a significant downward trend.
The problem still exists in the pig week, and it will not be slowed down by the African swine fever and the short-term large-scale process
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Lan Renxing, deputy general manager of the feed supply chain management department of New Hope Liuhe Co.
, Ltd.
, pointed out that the profits of feed enterprises will be reduced in the future
.
Specifically, the current feed industry companies can be divided into three categories.
One is the entire industry chain, which has relatively strong ability to resist risks and generates profits in each value chain; the other is integrated companies, which have weak anti-risk capabilities; The third is a single feed company.
The main source of profit is specialization and differentiation, and the ability to survive in the cracks is stronger
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Liu Shijie, head of the agricultural product department of Zhejiang Hangshi Shancheng Industrial Co.
, Ltd.
, said that the global grains have been destocked in the past two years, with relatively high prices and greater volatility than usual.
Therefore, it is expected that feed farming companies will experience economic difficulties in the future.
Some challenges
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry

　　Zhang Yuchuan, deputy general manager of Yinhe Futures, said that the core issue of risk management for feed breeding enterprises is the control of feed procurement, cost and sales prices of livestock, that is, how to reduce procurement costs and increase sales prices
.
Judging from the currently available futures derivatives tools in China, with the launch of China’s live pig futures this year, soybean meal, corn, eggs, and live pig futures have constituted a relatively complete closed loop of the feed industry, which can make good use of futures for feed breeding companies.
And derivative instruments to lay a good foundation
.
cDE China Feed Industry Information Network-Based on feed, serving animal husbandry