January 17, 2023
New Hope Liuhe expands rapidly in 'special' aquafeed market
New Hope Liuhe is the largest feed company in China, and its total feed sales in 2021 reached 28.24 million tonnes.
In 2021, New Hope Liuhe's total sales of aquafeed reached 1.61 million tonnes, accounting for about 7% of China's total output. This year, the company stressed that, from the standpoint of average profit per tonne, its aquafeed is positioned as the highest, followed by pig feed and poultry feed.
In recent times, the sales growth rate of New Hope Liuhe's aquatic products has exceeded those of other feeds. The company is set to further its development of aquatic materials, and, at the same time, improve the research and development, production and sales of supplementary products such as aquatic animal insurance.
The aquafeed business is one of the eleven "must-win battles" highlighted by New Hope Liuhe in 2021, as it set a volume target of 4.5 million tonnes by 2024, comprising 1.5 million tonnes of 'special' feeds and three million tonnes of 'general' feeds. To achieve this goal, New Hope Liuhe will expand its current production lines at its existing base, while also seeking mergers, acquisitions and leases to expand production capacity.
New Hope Liuhe has frequently made mergers and acquisitions in the past two years to achieve rapid development in the aquafeed field. Among several such actions, it had successfully acquired Zhejiang Haihuang Biotechnology Co., Ltd. and 70% of the equity in Zhangjiajie New Rising Feed Co., Ltd., both of which are 'special' aquafeed enterprises. When New Hope acquired Zhejiang Haihuang, it stated that the acquisition can fill the gap in the special aquafeed market in East China. The acquisition of Hunan Xinruixing Feed enables the company to enhance its research and development, sales and lean production capabilities in the 'special' aquafeed field, hence improving its competitiveness in Hunan.
Compared with Haid Group, Aohua Group, Yuehai Group and Fujian Tianma (all of which focus on 'special' aquatic products), the production of New Hope Liuhe and Tongwei is mainly focused on 'general' aquatic feed.
New Hope Liuhe has only started to focus on the 'special' aquafeed segment in the past two years.
In 2020, the company established a special aquafeed project and saw its aquafeed sales volume surging over 50% year-on-year to over 400,000 tonnes, accounting for about one-quarter of its total output of aquafeed.
- David Lin, eFeedLink