The layer hen industry is accelerating its transformation: what does the future hold?
As a veritable major producer of layer hens, for a long time the farming method has nevertheless been dominated by small and medium-scale farms of fewer than 10,000 birds, with the prominent industry characteristic of “small scale, large population.” Problems that exist in the course of its development, such as overcapacity, weak chick-rearing capacity and insufficient deep-processing capacity, also cannot be ignored. How to enable the layer hen industry to make a smooth transition to improved breeds, specialization, modern facilities and market orientation is a major issue of concern to the industry.
The impact of the 2013 “H7N9 incident” led to a decline in layer hen inventories, and the risks accumulated from supply shortages fully erupted in 2014; after the United States detected highly pathogenic avian influenza virus, China announced that starting from January 9, 2015 it would suspend imports of all American poultry, poultry products and egg products; in the first half of this year egg prices kept falling, farmers lacked confidence in the market outlook, and enthusiasm for restocking declined……
⟦NL> A series of events made many people exclaim, “What on earth is happening to the layer hen industry?” However, in the view of Yang Ning, chief scientist of the National Layer Hen Industry Technology System, who has long been engaged in research on new technologies for animal genetic breeding and poultry production technology systems, and professor at the College of Animal Science and Technology of China Agricultural University, although these events were not anticipated, they were nonetheless taken into account in response strategies.
Yang Ning told a reporter from China Science Daily that “China, with about 21% of the world's population, produces and consumes about 40% of the world's eggs, and its per capita egg consumption level is about twice the world average.” As a veritable major producer of layer hens, for a long time the farming method has nevertheless been dominated by small and medium-scale farms of fewer than 10,000 birds, with the prominent industry characteristic of “small scale, large population.” Problems that exist in the course of its development, such as overcapacity, weak chick-rearing capacity and insufficient deep-processing capacity, also cannot be ignored. How to enable the layer hen industry to make a smooth transition to improved breeds, specialization, modern facilities and market orientation is a major issue of concern to the industry.
Industry develops in waves
Xue Jinggui, who has raised layer hens for many years, has this feeling: “In the first half of this year, returns fell slightly compared with the same period in previous years.” Xue Jinggui runs a chicken-raising cooperative, currently with a scale of more than 10,000 chickens.
And Xue Jinggui's “feeling” was exactly what Yang Ning and others had anticipated. “After research and analysis of enterprises and the market, it is generally believed that the rise-and-fall cycle of returns in the layer hen farming industry is about 3 years. According to monitoring data, layer hen farming returns are expected to decline in 2015.” Yang Ning said.
Although layer hen production capacity declined in 2014, causing egg supply and demand to be in a state of tight balance. “But the production returns of the layer hen industry for the whole year were good, and the prices of eggs and culled chickens were at historically high levels, especially in August when the egg price hit a record high of 10.71 yuan/kg.” Yang Ning said.
It is understood that in 2014 the profit from raising commercial layer hens exceeded 30 yuan per bird, and the layer hen industry also became the most profitable industry in the livestock sector.
Wang Junxun, deputy director of the Department of Animal Husbandry of the Ministry of Agriculture, analyzed that because the high returns of the layer hen industry in 2014 mobilized enthusiasm for layer hen farming, it caused the inventory of laying hens and egg production to rise in the first 5 months of this year.
According to monitoring data from the Department of Animal Husbandry of the Ministry of Agriculture on 100 layer hen farming counties nationwide, in May the inventory of laying hens was 14.9143 million, up 1.2% month on month and up 8.9% year on year.
“At present, the inventory of laying hens is at a relatively high level in the past two years, and it is expected that egg prices will continue to move lower in the next two months, with farming returns significantly lower than in 2014.” Wang Junxun further analyzed.
Yang Ning said that after years of development, China's layer hen industry has basically completed improved breeding, specialization, modern facilities and market orientation, and has formed a relatively complete internal division-of-labor system.
In the view of Qin Fu, scientist for the industry economics post of the National Layer Hen Industry Technology System and researcher at the Institute of Agricultural Economics and Development of the Chinese Academy of Agricultural Sciences, after the financial crisis China's layer hen industry recovered relatively quickly but market stability was poor, egg prices fluctuated frequently, and farming returns rose and fell sharply. “It can be said that although China's layer hen farming has gradually advanced the internal integration of the industry amid the pains, it has also brought negative effects such as damaged interests of farmers and unstable market supply.”
Chick rearing is the biggest problem
In recent years China has imported about 200,000 grandparent layer hens from the United States each year. However, after an avian influenza outbreak occurred in the United States, the General Administration of Quality Supervision, Inspection and Quarantine and the Ministry of Agriculture issued an announcement on January 9, 2015 prohibiting the import of live poultry, hatching eggs and poultry products from the United States, seriously affecting the normal production and operation of some grandparent layer hen farms.
Nevertheless, “the considerable development of domestic independent breeding in recent years can guarantee the production capacity of grandparent layer hens, and the supply of improved breeds is fully guaranteed in both quantity and quality.” Yang Ning explained to a reporter from China Science Daily.
Statistics and calculations by the China Animal Agriculture Association show that in 2014, nationwide newly added grandparent layer chicks totaled 559,600 sets, the inventory of grandparent layer breeder hens in production was 630,300 sets, the inventory of parent-stock layer breeder hens was 17 million sets, the inventory of commercial laying hens was 1.170 billion birds, and egg production was about 21 million tons.