“Understanding China: How the second-largest poultry market is changing the world,” was the topic of the Alltech Annual Breakfast Meeting at the International Production & Processing Expo. Dr. Mark Lyons, global vice president and head of Greater China for Alltech gave the presentation before 250 people.

There has been a great urban shift of 300 million people within the economic power player, resulting in 188 cities in China larger than Chicago. Additionally, China has a rising middle class that is young, urban and globally minded.

“China is different and is not for the faint-hearted,” said Lyons. “They rapidly change and want transparency, and if you’re going to do business in China, then you need to be there, and you need to commit to being Chinese.” 

China is going through a period of transition in many areas, including agriculture. Its industry has been very fragmented, but it is evolving toward more integration and segmentation. Results from the 2017 Alltech Global Feed Survey showed that China continues to be the largest feed-producing country but is producing that feed with fewer and fewer mills. The consolidation has been vast, with a report this year of a nearly 30% decline in the country’s number of feed mills. 

China is home to 20% of the world’s 60 billion poultry birds, including 8.8 billion broilers, 1.2 billion layers/breeders and 4 billion waterfowl. Currently, China produces 26% of the world’s poultry meat, and studies show that both consumption and production of poultry will continue to increase in China, and worldwide, over the next 10 years. China is also the world leader in egg production, producing almost six times more than the United States, which is in second place.

Trends in China

Challenges

“We have been talking about the power of the new consumer, which we are calling the prosumer,” said Lyons. “I believe there are more prosumers in China than any other market in the world today.” 

Rather than simply consuming products, these prosumers are proactively exhibiting their beliefs, ethics, standards and aspirations through their purchases. Prosumers are product and brand advocates who now significantly affect the success or failure of companies, products and brands through their involvement on social media outlets, and food producers and farmers need to pay attention to their demands.

As consumer awareness of environmental pollution has grown, it has created pressure at the farm level. The Chinese government has put a focus on livestock pollution control regulations, new environmental laws, animal husbandry laws, standardized scale farming, water regulations and animal disease control laws.

Source: Alltech