December 21, 2012
Indonesia's Japfa Comfeed plans to expand its beef fattening feedlot cattle business in China by building a breeding beef cattle feedlot in early 2013 through its subsidiary, PT Santosa Agrindo (Santori).
Dayan Antoni, Head of Government Relations and Business Development of Santori, said "The expansion is a new Japfa, as long as there is no fattening foreign companies enter China."
Cattle business in Indonesia is unfavourable which encourages Japfa to target the market opportunities abroad. As is known, the government continues to cut significantly the allocation of import calves from year to year. On the other hand, the supply of local beef cannot be relied upon on an on-going basis.
Santori and its subsidiary, PT Austasia Stockfeed, calves import quota in 2013 is only about 31,000 birds. This number is shrinking share of 24.39% compared to 2012 reaching 41,000 individuals.
Japfa cattle will build a facility in Hekou, Shandong Province, China. Although reluctant to mention the value of its investment, the target cattle production has reached 90,000 fish per year or 30,000 birds per cycle (three-four months).
Land required for cattle is estimated at 200 hectares, while the agricultural land surrounding the source of green fodder is 500 hectares seeds calves from local cows.
Dayan claimed Japfa facilities owned cattle is the largest in the State of the Great Wall. As in Indonesia, cattle facility in China operates mostly with small and medium-scale enterprises (SMEs). While most of the volume of production is estimated at 50,000 head of cattle per year.
The development process of cattle facilities in China takes about six months. Santori Management is optimistic that the second half of next year is to operate the facility cattle.
Japfa groups is interested in investing in China because of the country's large population. Shandong Province, for example, has a population of 95 million inhabitants. While in other provinces such as Hebei, Henan, Anhui, Shanxi and Jiangsu recorded a total population of about 500 million people. In China, the number of the Muslim population reaches approximately 120 million people. Muslim society would consume halal products, beef being one of them. "This condition is our opportunity to enter China," said Dayan.
Beef Committee Chairman Jakarta Raya, Sarman Simanjorang said cattle fair better when companies choose to develop their business overseas. "The company is certainly in dire need of certainty to try," he said.
With the tight allocation of import cattle in Indonesia, Sarman's concern will further encourage other companies to invest abroad. Currently Santori has two Feedlot. One is located in Lampung who fatten cattle ex-import with capacity of 40,000 head, one Feedlot again in East Java local cattle fattening with a capacity of 15,000 head. Santori also had one unit abattoir (slaughterhouse) with standard export grade A and ISO 2200:2500 in Serang, Banten.
In 2007, Santori started breeding through Austasia Breeding Centre in Lampung capacity of 20,000 head. Currently Santori breeding cattle population reached 14,000 head, consisting of 8,000 head of cattle and 6,000 head of cattle breeding puppies.
