November 7, 2006

China's direct subsidies for dairy cow households

The Chinese government announced its decision to subsidise approximately US$12 billion (RMB 100 million) for dairy cow genetic improvement in 22 provinces, says the US Department of Agriculture citing reports from the local Farmers' Daily.

The subsidies would raise the dairy farming household incomes of about 225,000 families to US$641 (RMB 5000). The Chinese government last year subsidised approximately US$1.92 million (RMB 15 million) for Holstein cow production in four of its provinces including Hebei, Inner Mongolia, Heilongjiang and Shangxi, reports the USDA.

The country's dairy cow inventory according to USDA estimates reached over 12 million head in 2005, with purebred Holstein cattle accounting for a one-third of the total inventory.

China's total milk production will reach 40 million tonnes by 2010, according to USDA citing forecasts from China Dairy Association. The country's dairy product production was 12.04 million tonnes last year, 10.5 times higher than 1995. The output value of the dairy product industry also grew 10.6 times higher to US$11 billion (RMB 89.1 billion).

Incidentally, China will export 83 Holstein dairy cattle to Mongolia for the first time, says the USDA citing reports from China Food Newspaper.

For the full USDA report, click here.