Anhui farmers eye premium opportunities from prime porkers

2016-03-25 09:20China Daily Editor: Qian Ruisha

Consumers with the ability to pay a premium for organic food are encouraging pig breeders in the mountains of eastern China's Anhui province to embrace new business opportunities that are expected to boost their incomes.

On a mountain about 1,000 meters above sea level, breeder He Xianglin has tapped a spring with "really sweet" water that he funnels through bamboo pipes to his pig farm about 100 meters to the south.

Around 120 sows and dozens of newborn black piglets drink the spring water and eat cabbages and turnips He also grows on the mountain slope, irrigated by the spring and fertilized with pig manure.

While some companies are said to be harnessing the spring to bottle expensive water in Luohanshan village in Susong county, He has been using the water to breed black pigs in the village since 2008.

"Many people think I am foolish, because merely using the water to feed pigs seems a wasted opportunity," He said.

But He, 51, has a plan. He shifted at the end of last year to breeding a renowned local porker, the Anqing Liubai black pig, which is prized for its slow growth and tastiness. He expects to have 3,000 pigs in a year, and the return on his investment will take nearly as long.

"It will take at least 10 months for each hog to reach a weight of 90 kilograms, twice as long as breeding white pigs," He said.

The cost of raising the pigs is higher too-each kilogram of a pig's weight costs about 14 yuan ($2.14), mostly for feed-but so are the returns.

Since more Chinese consumers are buying high-end agricultural products, which are regarded as healthier alternatives, He expects his "totally organic" business to be quite profitable.

"Such pork products are often priced much higher than regular ones," He said.

Zhou Pei, a marketing executive for Xiandai Fine Breed Cultivation Co, provides the sows He raises at no cost and contracts to purchase the pigs once they've grown. "The best parts of the pig are priced at about 100 yuan per kilogram in the stores in cities," Zhou said.

Supported by agricultural authorities, the company based in the neighboring Wangjiang county has worked to protect the Liubai species since 2005, when it was in danger of dying out, and possesses a monopoly on the variety.

China is the largest pork consumer in the world, and most of the meat comes from white pigs. Industry insiders have warned that China's pig industry faces overcapacity, even as more pork has been imported in recent years.

"Even without imported pork, domestic output can almost satisfy the needs of Chinese consumers," said Fu Yan, vice-president of Ningbo TechBank Co, one of China's largest breeders of white hogs.

But Zhou said the supply of black pigs, which fatten much more slowly and are of better quality, cannot meet the market demand for high-end pork products that are favored by more Chinese consumers.

In the early years, Zhou's company was devoted to protecting the pig species from dying out. Starting in 2014, the company made pork available to the market. Last year, the company sold 1.07 million kilograms of pork products from Liubai black pigs, 16 percent more than the previous year.

During the Spring Festival holiday, which concluded on Feb 13, sales topped 75,600 kilograms, 9 percent more than the same period last year, the company said.

Most of the pork was sold in more developed areas, such as the neighboring Jiangsu and Zhejiang provinces, according to Zhou, adding that the company is planning to open more stores in the provinces this year.

"Consumers in the province have better purchasing power and higher needs for high-quality pork," Zhou said.

According to the contract with Xiandai, He must sell his pigs to the company at a price of 18.4 yuan per kilogram.

"It is by cooperating with such local breeders like He that we can effectively increase the supply," said Zhou, whose company has also acquired some piggeries in the past two years.

Yu Xianming had been breeding white pigs since 2008, but sold his piggery, which has a capacity to breed more than 20,000 pigs, to Zhou's company at the end of last year.

Breeding regular white pigs had always been risky, since the market fluctuates, Yu said.

"I had seen total losses of 8.8 million yuan in 2013 and 2014, when the pork prices of white pigs dropped even as feed costs were climbing steadily," Yu said.

Yu, who is still managing the business after its sale, recently dug a well to bring underground water to the piggery, which is about 50 kilometers from He's farm.

To feed the farm's current population of 4,000 pigs, Yu also recently bought more than 100,000 kilograms of carrots from Shandong province at a cost of about 0.45 yuan per kilo. Xiandai covered all of the costs.


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