PIC Symposium 2011 | Nashville, TN Where will all the pigs be raised? Global Economics Vs Food...

PIC Symposium 2011 | Nashville, TN

Where will all the pigs be raised?

Global Economics Vs Food Security and other PoliticsJerry Thompson

Genus Director

Russia and Asia Pacific


Introduction

1. Global Economic Overview– The PIC World Pork Competitive Survey

2. Non-economic Factors– From Food Security to Customer Demand

3. Showcase on China


The Challenge

• Double food output by 2050 using 50% of the water that we use today


World Meat Production and Trade

• Meat Production grows at 1.8% per year• Meat Trade grows at 3.4% per year

Fapri 2010 World Agriculture Outlook


Per Capita Meat Consumption

• Pork first choice among consumers• 2019: 55 Kgs of Pork, Chicken and Beef



World Pork Production and Trade

• Production grows at 1.6% / Year• Trade grows at a rate of 2.8%



Who is Eating Pork?

PIC Symposium 2011 | Nashville, TNFapri 2010 World Agriculture Outlook

EU27

China

South Korea

United States

Canada

Australia

Russia

Chile

Japan

Mexico

Brazil

Philippines

0 5 10 15 20 25 30 35 40 45

Per Capita Pork Consumption (Kgs/person)


Selected Net Importer Countries



The PIC World Pork Competitive Survey

• Objective:

– Quantitative study of key success factors that positively or negatively impact growth in pork production in selected countries

• 70 Industry leaders from 15 different countries

• Focus on: USA, Canada, EU-27, Chile, Mexico, China, Japan, Brazil, Argentina, Australia, South Korea, Phillipines.


STRUCTURAL FACTORSCorn Prices

Land AvailabilityLabor Efficiency

Farm ProductivityLocal Demand for PorkPork Quality Standards

COST COMPETITIVENESS

Level of Cost of Production% Feed Cost / Total Cost

Cost per Sow in New Project

POLITICAL & SOCIAL FACTORSPork is Country´s Strategic

Government SubsidiesLocal Food Safety RegulationLevel of Environmental Laws

Welfare PressureCountry´s Animal Disease Control

Industry Key Success Factors


45 50 55 60 65 70 75 80 8545

50

55

60

65

70

75

80

85

China

EU27

USA

Brazil

Philippines

Canada

Mexico

Chile

Australia

Argentina

Japan

Structural Factors

Politi

cal &

Soc

ial F

acto

rs

BetterWorst

PIC 2010 World Pork Competitive Survey

Better

Ability to Compete?


45 50 55 60 65 70 75 80 85

-1

0

1

2

3

4

China

EU27

USABrazil

Philippines

Canada

Mexico

Chile

Australia

Argentina

Japan

Structural Factors

Cost

of P

rodu

ction

PIC 2010 World Pork Competitive Survey

Worst

Better

Better

What about Cost?


Non-Economic Factors

Food SecurityThe availability of food and our

access to it


China’s Twelfth Five Years Plan Date:16 March 2011

• 把握“一个重点任务”，按照科学发展的要求来加快现代农业的发展。在工业化和城镇化的过程当中，同步推进农业现代化。另外，要突出“一条主线”，就是要加快农业发展方式的转变，继续调整和优化产业结构。

• 紧紧围绕“两个目标”，就是把保证国家粮食安全、持续发展我们的粮食生产作为首要目标，把持续快速的增加农民收入作为农业农村经济工作的中心目标 .

• 提高“三个能力”，提高农业的综合生产能力、农业的抗风险能力和农业的市场竞争能力。

• 在“十二五”要下大力气推进“四化”，农业生产经

营的专业化、标准化、规模化和集约化。

• 强化“五大支撑”，强化农业发展的政策支撑、科技支撑、装备支撑、人才支撑、体制机制支撑

• Ⅰ• Speed up the development of modern agriculture.

• Ⅱ• Guarantee the safety and develop our production capacity.• Take increasing farmers income as the top priority in agriculture

economy development.

• Ⅲ• Improve overall agriculture production levels• Strengthen anti-risk capability• Enhance competitive edges

• Ⅳ• Promote agriculture business to be more specialization, more

standard, more systematization and more intensification.

• Ⅴ• Support agriculture development with preferential policies, advanced

technology and equipment, talented people and optimized mechanism.


The ‘Putin Plan’ for Russia• 2-й этап Программы

реализуется в 2013-2020 гг. Цель увеличить маточное поголовье до

2.85 млн свиноматок с общим поголовьем до 35 млн голов (при умеренном сценарии) или до 45 млн (при инновационном сценарии)

основные задачи для достижения плана:1. улучшение экономических условий

работы свиноводства России, обновление племенного потенциала, повышение конкурентоспособности и экономической эффективности производства свинины

2. создание и развитие сети селекционно-генетических центров с первоклассным научно-технологическим потенциалом

3. реконструкция действующих и создание новых производственных мощностей в товарном свиноводстве в рамках различных организационных моделей и форм хозяйственной деятельности

4. Развитие предприятий по убою и мясопереработке кормовой базы свиноводства, повышение качества кормов

5. разработка и внедрение современных стандартов качества и технического регламента производства свинины

• 2nd stage of the national program “Development of pork production 2013-2020”Objective to increase the national sow herd up to 2.85 mln sows with total pig stock up to 35 mln pigs ( with a moderate scenario) or up to 45 mln pigs (with an innovative scenario)

Key actions to achieve the targets: 1. Improvement of economy of pork sector.

2. Establishment of net of selection centers with innovative technologies

3. Reconstruction of existing production facilities & establishment of new operations within different organizational models & forms of business.

4. Development of slaughter & processing facilities and feed production for pork industry

5. Development & introduction of advanced quality standards & technical regulations of pork production.


Expansion plan of yearly average swine stock in 2009-2012 & up to 2020,

’000 Hds 2008(факт)

2009 2010 2011 2012 2020 – Moderate

2020 – Innovative

Federal celection centers -- 65 296 740 1 000 2 000 2 268

Pork operations: 3 494 4 028 4 461 5 210 5 273 9 929 16 079

- units with capacity of 216 K heads 799 871 945 1 026 1 042 1 771 2 627

- units with capacity of 198 K heads 721 795 885 967 990 1 875 2 814

-unit with capacity of 54 K heads 545 619 715 793 800 1 400 3 940

- units with capacity from 6 up to 54K heads 1 429 1 742 1 915 2 424 2 441 4 883 6 698

Companies with capacity less than 6 K heads

3 506 3 662 3 784 4 121 4 205 11 364 12 195

Little farms (kolkhoz) 1 786 1 813 1 721 1 844 1 875 3 289 5 263

Private backyards 8 824 8 373 8 111 8 044 8 148 8 418 9 195

TOTAL17 609 17 941 18 372 19 960 20 500 35 000 45 000

Including sows 1 715 1 738 1 766 1 791 1 831 2 779 3 000


Программа государственной финансовой поддержки:

1. Единовременные субсидии федерального бюджета племенным хозяйствам на

первоначальное приобретение свиноматок хряков с высоким генетическим потенциалом в

размере 20% от стоимости поголовья.2. Государственная поддержка ежегодного

обновления основного стада для плем. товар хозяйств в размере: для племхозяйств 6 тыс. рублей на голову, для товар. хозяйств 3 тыс. рублей на голову. Благодаря данному направлению государственной поддержки предполагается снизить зависимость российского свиноводства от поставки импортных плем животных, сформировать условия для возрождения и развития отечественного племенного свиноводства.

3. Государственная поддержка на содержание маточного стада племенных хозяйств отвечающих современным требованиям племенного дела в размере 5 тыс. рублей на основную и проверяемую свиноматку основного стада.

4. Государственная поддержка товарных продаж свинины из селекционно-племенных центров с целью компенсации затрат СГЦ при реализации свиноматок и хряков из основного стада на товарное мясо из расчета 20 руб. за килограмм живого веса

5. Субсидирование процентных ставок по инвестиционным кредитам для реконст-

рукции и строительства свиноводческих мощностей, предприятий по убою и мясопереработке и предприятий комбикормовой промышленности, финансовая поддержка НЦ

State financial program:

1. One-time subsidies from federal budget to breeding organizations for first purchase of sows & boars with a high genetic potential in amount of 20% from the stock value.

2. State support of annual replacement of the main herd for breeding & commercial complexes: 6 000 rb/head for breeding units & 3000 Rb/head for commercial units. With this measure it is planned to minimize dependence from imported breeding pigs & form proper conditions for restoration & further development of local swine breeding.

3. State financial support to grow sow stock of the breeding organizations in amount of 5 000 Rb for a productive sow in the main herd meeting all up-to-date requirements of the breeding operations.

4. State support of commercial sales of pork from selection centers with an aim to reimburse expenses of selection centers for slaughtering sows & boars from the main herd in amount of 20 Rb per 1 kg live weight.

5. Subsidies of interests rates of the investment loans taken for reconstruction & construction pig production projects, slaughter & processing facilities projects & feed production operations. Financial support of research centers.


The Republic produces 2.6M pigs in 1965!!!


The Result….


Trade Restrictions….



…and other Politics


Animal Welfare Concerns


COUNCIL DIRECTIVE 2001/88/ECof 23 October 2001

amending Directive 91/630/EEC laying down minimum standards for the protection of pig

Sows and gilts shall be kept in groups during a period starting from 4 weeks after the service to 1 week before the expected time of farrowing. The pen where the group is kept must have sides greater than 2,8 m in length. When less than 6 individuals are kept in a group the pen where the group is kept must have sides greater than 2,4 m in length.


COUNCIL DIRECTIVE 2001/93/ECof 23 October 2001

amending Directive 91/630/EEC laying down minimum standards for the protection of pig

• Focus on:– Light requirements and maximum noise levels, – Permanent access to materials for rooting and

playing, – Permanent access to fresh water, – Additional restrictive conditions to carry out

mutilations on pigs, – Minimum weaning age of four weeks.


UK Herd Size – 1973 - 2010


In response 40% of the UK herd is now outdoors

PIC Symposium 2011 | Nashville, TN2011 - PIC Survey

Sow Stalls or Group Housing by 2020?

Group Housing Outdoors Sow Stalls -

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

Asia China EuropeLatin America North America

%


What does the Customer really want?

PIC Symposium 2011 | Nashville, TNFapri 2010 World Agriculture Outlook (2009 Data)

China49%

Japan3%

Vietnam2%

South Korea2%

Philippines1%

Russia3%

EU2721%

US9%

Brazil3%

Mex-ico2%

Chile0,3% Other

6%

Global Consumption



Population Density



Source: Brilliant Pioneer Consultant

Future of China’s Protein Consumption 2005 - 2030

0

10

20

30

40

50

60

70

80

90

100

110

120

Million Tonnes

Beef Poultry

Pork

Dairy

Eggs


26222936

3255

47615153

4140

3587

8%

9.5%

6.2%6.8%

7.4%

8.0%

4.3%

0

1000

2000

3000

4000

5000

2003 2004 2005 2006 2007 2008 2009

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

11.0%

12.0%

Stable increase of rural inhabitants’ income

Unit: RMB

Source: Statistics Bureau of China


No comparative advantage for land intensive agriculture




The new Integrators


PIC Nucleus in Benxi


Thank you!

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