Recently
the Ministry of Agriculture in China released their 13th five-year
plan for the years 2016 to 2020 for the feed industry. The key points of this
plan mainly affect the outputs, enterprise numbers and raw materials, according
to CCM’s analysts. For foreign suppliers of raw materials, this plan will
change future trade, due to the fact that China tries to lower its dependence
on import of the materials and additives and concentrates on self-manufacturing
of those.
The
plan, published in October 2016, contains on the one hand a review of the 12th five-year plan and on the other hand points out the guidelines for the next years’
development.
Source: StockSnap.io
According
to the 12th plan, the feed industry in China developed very fast. In
fact, since 2010 this industry experienced a total growth of 23.5% compared to
2010, the beginning of the last five-year plan. The overall output even reached
200 million tonnes in the year 2015. This amount by the way earns the People’s
Republic of China the first rank worldwide in feed output. The flagship of the
feed industry in China is the pig feed’s output with namely 83.44 million tonnes.
That is a 40.3% increase over 2010. The 13th plan has the goal to
increase this amount even further up to 94 million tonnes. The overall feed
output is supposed to rise to 220 million tonnes.
In
opposite to the increasing feed output, the Ministry of Agriculture plans to
decrease the amount of feed manufacturers in China, due to the inefficiency and
environmental pollution of many small producers. The number already decreased
by 4,071 units during the last five years and this trend is supposed to go on
until a reduction to around 3,000 factories. To keep the production up and even
boost it, the plan provides for the fact that the focus on developing is on the
big enterprises with an annual output of 500,000 tonnes or more to increase the
number of manufacturers with an annual output of at least 1,000,000 tonnes.
Source: Ministry of Agriculture of the
People’s Republic of China
The
table illustrates the different shares of the feed industry segments and the
comparison of the outcome of last five years to the forecasted outcome of the
next five years. The important rule of the pig feed segment and the endeavors
to grow it the highest degree is shown obviously. The table also illustrates,
that both poultry feed industries accumulated surpassed the pig feed industry
in the last five years, while the 13th plan determines those
segments on the second place after pig feed.
Related
to the huge growth of the feed industry in China, the upstream industries like
feed additives are also blessed with a rapid growth. The output of feed grade
vitamins, for example, reached 280,000 tonnes in 2015. The sector of feed grade
amino acids experienced even an output of 1.52 million tonnes, according to the
Ministry of Agriculture.
Another
notable fact is, that China has loosen its heavily dependence on methionine
imports, due to the establishing of two big methionine plants in China. The 13th plan is forecasting a stabilization of the production capacity of feed grade
vitamins and amino acids to meet the domestic demand of those.
The
plan of the Ministry of Agriculture furthermore intends to lower the dependence
on protein feed additives, which are mainly imported, and goes towards more use
of synthetic amino acids for feed additives.
For
foreign suppliers of feed additives like vitamins and amino acids, this
development should be watched very carefully, as China is about to strengthen
own manufacturing over import. Nevertheless, the focus on the domestic
manufacturing also offers good opportunities for investments in the Chinese
feed additive industry itself.
The
five-year plan, or five-year guideline, in China was published in 1953 for the
first time. Since then it identifies the areas, where researchers, investors
and human resources put their focus on. The guideline provides the direction of
the second largest economy in the world, which guarantees it huge domestic and
foreign attention. Also, the 13th five-year plan is the first plan
under President Xi Jinping. It is therefore very important, as the year 2020
will be the last year of realizing China’s goal of a moderately prosperous
society, according to the Ministry of Agriculture.
About CCM:
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for China’s agriculture, chemicals, food & ingredients and life science
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Tags: amino acid, feed, five-year plan