Where will all the pigs be raised? Global Economics Vs Food Security and other Politics Jerry Thompson Genus Director Russia and Asia Pacific PIC Symposium 2011 | Nashville, TN 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 PIC Symposium 2011 | Nashville, TN The Challenge • Double food output by 2050 using 50% of the water that we use today PIC Symposium 2011 | Nashville, TN 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 PIC Symposium 2011 | Nashville, TN Per Capita Meat Consumption • Pork first choice among consumers • 2019: 55 Kgs of Pork, Chicken and Beef Fapri 2010 World Agriculture Outlook PIC Symposium 2011 | Nashville, TN World Pork Production and Trade • Production grows at 1.6% / Year • Trade grows at a rate of 2.8% Fapri 2010 World Agriculture Outlook PIC Symposium 2011 | Nashville, TN Who is Eating Pork? PIC Symposium 2011 | Nashville, TN Per Capita Pork Consumption (Kgs/person) Philippines Brazil Mexico Japan Chile Russia Australia Canada United States South Korea China EU27 0 Fapri 2010 World Agriculture Outlook 10 20 30 40 50 PIC Symposium 2011 | Nashville, TN Selected Net Importer Countries Fapri 2010 World Agriculture Outlook PIC Symposium 2011 | Nashville, TN 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 countries leaders from 15 different • Focus on: USA, Canada, EU-27, Chile, Mexico, China, Japan, Brazil, Argentina, Australia, South Korea, Phillipines. PIC Symposium 2011 | Nashville, TN Industry Key Success Factors STRUCTURAL FACTORS Corn Prices Land Availability Labor Efficiency Farm Productivity Local Demand for Pork Pork Quality Standards POLITICAL & SOCIAL FACTORS Pork is Country´s Strategic Government Subsidies Local Food Safety Regulation Level of Environmental Laws Welfare Pressure Country´s Animal Disease Control COST COMPETITIVENESS Level of Cost of Production % Feed Cost / Total Cost Cost per Sow in New Project PIC Symposium 2011 | Nashville, TN Ability to Compete? Better Political & Social Factors 85 80 75 Canada China 70 65 Brazil Japan 60 Philippines Chile Argentina EU27 55 Mexico USA 50 Australia 45 45 50 55 Worst PIC 2010 World Pork Competitive Survey 60 65 Structural Factors 70 75 80 85 Better PIC Symposium 2011 | Nashville, TN What about Cost? Better 4 Argentina Cost of Production 3 Brazil USA Chile 2 Canada Mexico 1 EU27 Japan Australia 0 45 50 55 China 60 65 70 75 80 85 Philippines -1 Worst Structural Factors PIC 2010 World Pork Competitive Survey Better PIC Symposium 2011 | Nashville, TN Non-Economic Factors Food Security The availability of food and our access to it PIC Symposium 2011 | Nashville, TN 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. PIC Symposium 2011 | Nashville, TN 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 селекционногенетических 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 • 1. 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: 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. PIC Symposium 2011 | Nashville, TN Expansion plan of yearly average swine stock in 2009-2012 & up to 2020, 2008 (факт) 2009 2010 2011 2012 2020 – Moderate 2020 – Innovative -- 65 296 740 1 000 2 000 2 268 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 17 609 17 941 18 372 19 960 20 500 35 000 45 000 1 715 1 738 1 766 1 791 1 831 2 779 3 000 ’000 Hds Federal celection centers Pork operations: TOTAL Including sows PIC Symposium 2011 | Nashville, TN Программа государственной финансовой поддержки: 2. 3. 4. 5. 1. Единовременные субсидии федерального бюджета племенным хозяйствам на первоначальное приобретение свиноматок хряков с высоким генетическим потенциалом в размере 20% от стоимости поголовья. 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. 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. 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 Субсидирование процентных ставок по инвестиционным кредитам для реконструкции 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. PIC Symposium 2011 | Nashville, TN Financial support of research centers. The Republic produces 2.6M pigs in 1965!!! PIC Symposium 2011 | Nashville, TN The Result…. PIC Symposium 2011 | Nashville, TN Trade Restrictions…. PIC Symposium 2011 | Nashville, TN PIC Symposium 2011 | Nashville, TN …and other Politics PIC Symposium 2011 | Nashville, TN Animal Welfare Concerns PIC Symposium 2011 | Nashville, TN COUNCIL DIRECTIVE 2001/88/EC of 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. PIC Symposium 2011 | Nashville, TN COUNCIL DIRECTIVE 2001/93/EC of 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. PIC Symposium 2011 | Nashville, TN UK Herd Size – 1973 - 2010 PIC Symposium 2011 | Nashville, TN In response 40% of the UK herd is now outdoors PIC Symposium 2011 | Nashville, TN Sow Stalls or Group Housing by 2020? % 90.00 80.00 70.00 60.00 50.00 40.00 30.00 20.00 10.00 - Group Housing Asia 2011 - PIC Survey China Outdoors Europe Latin America Sow Stalls North America PIC Symposium 2011 | Nashville, TN What does the Customer really want? PIC Symposium 2011 | Nashville, TN Global Consumption Chile Brazil Mexico 2% 0,3% 3% Other 6% US 9% China 49% EU27 21% Russia 3% Philippines 1% South Korea 1% Fapri 2010 World Agriculture Outlook (2009 Data) Vietnam Japan 3% 2% PIC Symposium 2011 | Nashville, TN PIC Symposium 2011 | Nashville, TN Population Density PIC Symposium 2011 | Nashville, TN PIC Symposium 2011 | Nashville, TN Future of China’s Protein Consumption 2005 - 2030 Million Tonnes 120 Dairy 110 100 90 80 Pork 70 60 50 40 30 20 Beef Eggs Poultry 10 20 05 20 10 20 20 20 30 20 05 20 10 20 20 20 30 20 05 20 10 20 20 20 30 20 05 20 10 20 20 20 30 20 05 20 10 20 20 20 30 0 Source: Brilliant Pioneer Consultant PIC Symposium 2011 | Nashville, TN Stable increase of rural inhabitants’ income 4761 5000 Unit: RMB 4000 5153 12.0% 11.0% 4140 10.0% 3587 3255 3000 9.0% 2936 2622 7.4% 9.5% 8% 8.0% 6.8% 8.0% 6.2% 2000 7.0% 6.0% 1000 4.3% 5.0% 0 4.0% 2003 2004 2005 2006 2007 2008 2009 Source: Statistics Bureau of China PIC Symposium 2011 | Nashville, TN No comparative advantage for land intensive agriculture PIC Symposium 2011 | Nashville, TN PIC Symposium 2011 | Nashville, TN PIC Symposium 2011 | Nashville, TN The new Integrators PIC Symposium 2011 | Nashville, TN PIC Nucleus in Benxi PIC Symposium 2011 | Nashville, TN Thank you! PIC Symposium 2011 | Nashville, TN