Although packaged meats sold in supermarkets are beginning to catch on in Chinese cities, 85% of pork consumed in China is still purchased in open markets where the hogs have been butchered the same morning.  That was one of the findings that Claude Vielfaure, executive vice-president of Hytek Ltd., shared with producers attending Manitoba Swine Seminar 2008 in Winnipeg on January 31.

Vielfaure has visited China several times in recent years to meet with Hytek partners in the region.  His most recent visit was as part of a Canadian trade mission attending the World Pork Congress in Nanjing last September. The group also visited some hog farms and a major hog processing operation – the Yurun Food Industry Group – in Nanjing.

He reported that pork and pigs are a central part of Chinese culture.  The Chinese pictogram for “family”, he noted, is a picture of a pig under a roof. China, he said, accounts for 50% of world pig production. Total pork production – 53 million tonnes last year – is almost triple what it was 18 years ago.  At the same time, imports (400,000 tonnes last year) are almost double what they were 15 years ago.

Chinese per capita pig consumption is 39.6 kg, a third more than in the US and Canada and accounts for three-quarters of Chinese meat consumption.  However, Vielfaure reported that pork prices in China are soaring, with the price last August 77% higher than the year before.  “The government is making an effort to keep hog and pork prices down,” Vielfaure said, “but chronic low profitability turned into severe losses after corn prices jumped. To save on costs, many producers stopped vaccinating and forgot about biosecurity.  The result is that PRRS has become rampant.  While the government estimates that 20,000 pigs were lost, private estimates put the figure in the millions.”

Vielfaure reported huge potential for increased sow productivity in China through improved genetics and biosecurity and a decline in backyard producers.  There is also enormous potential for increased feed grain production. On the other hand, he noted, lack of infrastructure and availability of water are problems. Also, feed transport costs are substantial because the grain production is mainly in northern China while hog production is principally in the south.

The Chinese government, he reported, recently announced a 7 billion RMB program to address pork price inflation which includes subsidies for breeding sows, money for building new breeding systems, vaccination subsidies and a campaign to encourage a move toward more intensive, large scale production.

For Canadian companies in the hog production industry, Vielfaure identified opportunities in China for genetic suppliers and providers of feed manufacturing infrastructure.  The government’s push for better food safety practices will also diminish the importance of open markets and increase the sale of packaged meat