FEED Business Worldwide - June 2012
Trends in China's breeder poultry grandparent stock
by SHI Tao in Shanghai
China's layer and broiler sourcing habits are experiencing both a restructuring of bird sourcing suppliers, along with consumer-driven stratification between native and imported breeds. These changes have long-run implications for the type of chicken meat and egg laying birds that will define poultry, which is both the most consolidated and fastest growing of China's protein lines.
Layer breeder: consolidation and expansion of local breeders' market shares
The country is closer to breeder stock self-sufficiency in the layer sector for a number of reasons. The number of farms in China importing layer breeders has been on the decline for the past several years. The main reason for this trend is industry restructuring.
China's layer breeder industry has undergone vigorous consolidation over the past decade. In early 2000s, there were about 30 farms in China importing grandparent stock (GPS) layer breeders each year. However, there is a decrease in the importers of GPS layer breeders over the years. In 2008, only 18 farms imported layer breeders. This number dropped to 15 in 2009 and to 11 in 2010.
Last year, there was a slight rebound, with 13 companies importing layer breeders but the number of importers remained well below the numbers a decade ago.
The decline in layer breeder importing companies was the result of a drop in the number of breeder farms. Consolidation of the industry has squeezed out smaller and less efficient farms. Currently, 80% of China's GPS layer breeder inventory is being reared by a handful of companies. These include Beijing Huadu YuKou Poultry, Shandong Yisheng Livestock & Poultry Breeding and Hebei Huayu Fowl Breeding, with Huadu Yukou holding the largest market share.
From the import data shown here, we can see that most layer breeder importers are located in China's north or northeast. Hebei province, together with neighbouring Beijing, imported 4 out of the 13 batches of layer breeders last year, accounting for 31% of the total volume imported. By absolute volume, Shandong was the largest importing province. Indeed Shandong Yisheng Livestock & Poultry Breeding Company's single shipment of 106,480 birds accounted for 33% of China's 3011 layer import volume.
With the ongoing consolidation of the layer breeder industry, a trend is also being observed of increasing domestic production of GPS layer breeders over the years. After Huadu YuKou poultry ended its partnership with Hy-line International, it moved on to develop its own breeds of GPS layer breeders. This has helping China to break away from its reliance on foreign breeding companies for its supply of GPS layer breeders. UP to now, America's Hy-line, Netherlands-based Hendrix and Germany's Lohmann have dominated China's supply of layer breeders.
According to statistics from the China's ministry of agriculture and Huadu Yukou, in 2011, the market share of local GPS layer breeders increased to 48%, rising by a substantial 18% over just 5 years, from a 30% share in 2006. Although industry players believe that the actual market share of local layer breeders is considerably lower, it is undeniable that the trend will continue and domestically bred layers will soon make up a majority of birds in this line.
Broiler breeders: Aviagen, white feather birds dominate by imports
Things are somewhat different in the broiler line, where imported and local breeds have carved out solid, respective market shares for themselves. The global broiler breeder market itself underwent few changes over the years, with Aviagen, Cobb and EW Group enduring as the industry's main suppliers.
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