Building a Five-Ring Industrial Chain to Restructure a New Agricultural Format

The internet and high-tech have caused many industries to continuously generate new formats. Some industries may perish overnight, and some may rise overnight. SF Express threw China Post into disarray, Alipay put banks on high alert, e-commerce left shopping malls panic-stricken, Didi and Kuaidi left taxi companies dizzy, and 3D printing has traditional manufacturing hanging by a thread. A revolution in the agricultural industry is also quietly taking place, and restructuring new formats has become a trend. The key to restructuring new formats lies in building a “five-ring industrial chain” and forming an agricultural community of shared interests through the action of the value chain.

An industrial chain is the sum of a product and its related upstream and downstream products. The formation of an industrial chain is caused by the social division of labor. As the social division of labor becomes increasingly fine and transactional activities become increasingly complex, a single enterprise finds it difficult to cope, and thus separates out several specialized segments. These specialized segments divide labor and cooperate, complement and interact with each other, operate in coordination, and are linked ring by ring. Upstream delivers products or services to downstream segments, and downstream feeds information back to upstream segments, exchanging value with each other, thereby maximizing industrial value. When the efficiency of a certain node in the industrial chain changes, it may cause a multiplier effect in other related industries, and the resulting benefit is not the physical addition of the benefits of each segment but a chemical reaction.

The industrial chain contains four dimensions: the value chain, the enterprise chain, the supply and demand chain, and the spatial chain. The industrial chain is the community of shared interests formed by these four dimensions in the equilibrium process of mutual connection. This “connection mechanism” is an “invisible hand” that manipulates and controls the rise and fall of the industrial chain. The types of industrial chains are divided into connected type and extended type. The new agricultural format is to break the old pattern in which agriculture only operates within the primary industry, integrate the primary, secondary and tertiary industries, unify upstream, midstream and downstream, promote mutual reinforcement among production, supply, processing and sales, extend the industrial chain, develop agricultural tourism, and build an industrial form that conforms to the trend of agricultural modernization. The industrial chain of the new agricultural format mainly includes the five major links of “planting, breeding, processing, sales and tourism.” To build this industrial chain, the urgent task is to improve each link itself on the one hand, and on the other hand to connect the many links that each fight alone, form a community of shared interests, and continuously extend development and lengthen the chain.

I. Optimizing the Planting Industry

In 2014, China's grain output increased for the “eleventh consecutive year,” reaching 1,214.2 billion jin. Grain showed a state of “production, inventory and imports” all increasing. Premier Li Keqiang pointed out that “in recent years, grain inventories have continued to increase, warehouse capacity has been tight, and the fiscal burden has been heavy.” China's grain production has already escaped the long-term predicament of struggling with “insufficiency” and is gradually evolving toward struggling with “surplus.” Under such circumstances, agriculture must change with the times and transform “taking grain as the key link” into adapting to demand. The planting industry is at the very front end of the agricultural industrial chain and is the main support for the extended development of downstream links. The planting industry should focus on optimizing its structure according to the diverse needs of modern pluralistic civilization.

1. Optimize the structure to meet human living needs. With the increase in people's income, the improvement of living standards, and changes in lifestyle, living needs have also undergone major changes. The planting industry should also make adjustments and optimizations in response to these changes. Although China already ranks first in the world in the output of seven major agricultural products: cotton, oil crops, meat, poultry eggs, aquatic products, vegetables and fruits, the structural contradiction between supply and demand remains prominent. First, never relax in the production of grain, cotton, oil and sugar. Holding the rice bowl firmly in one's own hands is the top priority of governance. It is necessary to implement the strictest farmland protection system, designate permanent basic farmland, build a number of high-quality and efficient grain production bases, and stabilize grain production capacity. By 2020, China will ensure basic self-sufficiency in grains, with the self-sufficiency capacity for staple grains reaching 100%. At the same time, it should actively expand the production area of soybeans, miscellaneous grains, potatoes and other crops, and promote the development and industrialization of potatoes as a staple food. It should steadily develop the production of cotton, oil and sugar, consolidate the production capacity of traditional advantageous regions such as cotton in Xinjiang, sugarcane in Guangxi and Yunnan, and rapeseed in the Yangtze River Basin, and ensure a certain level of self-sufficiency (in 1995 China was still a net exporter of soybeans; by 2014 the self-sufficiency rate of soybeans had fallen to 14.6%, with imports of more than 70 million tons and domestic production of only 12 million tons. In 1992, Guangdong ranked first in cane sugar output; after 1992, Guangxi ranked first. Of Guangxi's 109 counties, more than 80 grow sugarcane, and more than 50 of them have sugar mills, with more than 26 million sugarcane farmers. In 2012 China's sugar output was 11.788 million tons, while total consumption that year was 14.0392 million tons. Originally supply fell short of demand, but imports reached as high as 3.747 million tons, creating an excess supply of 1.4958 million tons. The same was true in 2013 and 2014. If sugar is not rescued, China's cane sugar will be completely wiped out like soybeans). Second, coordinate the cultivation of melons, fruits, vegetables and flowers. Melons, fruits, vegetables and flowers are labor- and technology-intensive agricultural products with significant market competitive advantages. With the improvement of people's living standards, demand for specialty melons, fruits, vegetables and flowers with nutritional, health-care and ornamental functions is growing. China's melon and vegetable output already accounts for 60%-70% of the world total, and especially off-season melons and vegetables rank first in the world. Plastic greenhouses and plastic film mulching have been described as “white across the whole land.” China's greenhouses account for 87% of the world's total, and the consumption of fruits and flowers is developing from group consumption and holiday consumption toward daily household consumption. China's apple output accounts for 50% of the world total, reaching nearly 40 million tons, setting a record of substantial growth for 22 consecutive years from 1991 to 2013. In recent years, China's per capita fresh apple consumption has reached 13.2 kg, exceeding the world level of 8.2 kg, and it is expected to reach 15 kg per capita by 2018. China's flower planting has reached 1.3 million hectares, accounting for 1/3 of the world total area, with more than 3,500 specialized markets. In the more than 30 years since reform and opening up, planting has increased more than 50-fold, sales have increased more than 90-fold, and exports have increased more than 300-fold, and it is moving toward the development of ornamental, edible and medicinal functions. At present, it is necessary to adapt to market demand, develop high-quality varieties of melons, fruits, vegetables and flowers that are marketable, develop early- and late-maturing varieties, and improve the ability to supply evenly to the market. It is necessary to develop winter facility vegetables in northern cities, consolidate and improve the production capacity of winter melons and vegetables transported from the south to the north, develop characteristic plateau vegetables in the west, and ensure balanced regional and seasonal supply. It is necessary to strengthen key technological breakthroughs in the preservation of cut flowers and the cultivation and breeding of potted flowers, and introduce advanced foreign bulb breeding and technical equipment.

2. Optimize the structure to meet the needs of the breeding industry. Increase the production of feed grain and forage grass. From 1990 to 2012, China's per capita staple grain consumption fell by 16%, while meat, egg and milk consumption rose by 226%. It is expected that by 2030, China's feed grain consumption will reach twice that of staple grain. China has more than 6,400 species of forage grass and feed plants. They have different characteristics and ecological adaptability and can meet the production of green nutrient bodies under various natural resource conditions of climate, soil, light, heat and moisture. Even land unfavorable for the production of grain crops and cash crops can be used to plant suitable forage grass and feed plants. It is necessary to change the planting concept that grain is better than grass; the nutritional protein of alfalfa is 3 times that of grain. Some experts suggest that in the “sickle bend” region from Northeast to Northwest China, feed grain planting can be promoted and grass-field rotation implemented. In one rotation cycle of 3-4 years, soil organic matter can be increased by 23%-24%, and each hectare of land can increase nitrogen by 100-150 kg. Without increasing fertilizer application, the grain yield of the following crop can be increased by more than 10%. At the same time, low- and medium-yield fields, idle farmland, gaps in forest and fruit land, and southern grassy hills and slopes are all advantageous choices for developing grassland agriculture. China has 80 million hectares of low- and medium-yield fields, nearly 9.9 million hectares of idle farmland, and 1.48 million hectares of gaps in various sparse forests, tea forests and orchards. At present, less than 10% of the area has been used to plant forage grass. If 10% of the above types of land were used to plant fine forage grass, without affecting the original productivity, an additional 100 million tons of forage hay could be harvested. Calculated at an average of 10 kg of forage dry matter converting into 1 kg of beef and mutton, about 10 million tons of beef and mutton could be additionally produced. In addition, China also has 100 million hectares of grassy hills and slopes. The output of these grassland agriculture areas is equivalent to adding 100 million mu of good farmland.

3. Optimize the structure to meet the needs of industrial raw materials. Do a good job in planting special crops to meet the demand for industrial raw materials. First, develop biomass energy. At present, China has only 4 bioethanol production enterprises, while the United States has several hundred, with a very large consumption of corn. In view of China's current situation of relatively large corn inventories, increase efforts to develop corn conversion technology. At the same time, focus on marginal land such as semi-desertified areas and sandy areas in the “Three North” region, and in combination with ecological construction, build woody energy forest bases mainly based on shrub forests; carry out large-scale planting of sweet sorghum in Northeast China, Inner Mongolia, Shandong and other areas; plant tuber crops and plants such as canna edulis and kudzu in Guangdong, Guangxi, Hainan, Jiangxi, Sichuan, Yunnan and other places; build oil plant planting bases such as oil palm, Jatropha curcas and Pistacia chinensis in Hainan, Fujian, Sichuan, Guizhou, Yunnan, Hebei, Anhui and other places; strengthen research and development of oil-rich algae cultivation technology and carry out algae raw material cultivation projects. Second, support the planting of raw materials for medicine and other uses. Vigorously develop the production of raw materials for industries such as medicine, chemicals, food and brewing, encourage enterprises to establish the form of “company + new agricultural operating entities,” and establish raw material production bases.

4. Optimize the structure to meet the needs of green development. Building a green and sustainable growth model is an effective way to improve the efficiency of the planting industry. Implement major ecological restoration projects, consolidate the achievements of natural forest protection and returning farmland to forest and grassland, promote comprehensive management of desertification and rocky desertification, and protect wetlands. Accelerate the establishment of an ecological compensation mechanism and strengthen the windbreak and sand-fixation capacity of the Northwest region. Promote the protection of the black soil in Northeast China. The black soil in Northeast China had an initial thickness of more than 1 m when first cultivated, but now it is only 30-40 cm, and it is still being lost at a rate of about 1 cm per year, so protection is urgently needed. Restore the paddy fields in Jiangnan. China is one of the 13 water-poor countries in the world, and 81% of fresh water resources are concentrated south of the Yangtze River. The water content of Jiangnan paddy fields is equivalent to the storage capacity of the Three Gorges on the Yangtze River. In recent years, with the conversion of paddy fields to dry land in the Jiangnan region, the climate-regulating function of paddy fields has greatly declined. At the same time, vigorously promote the matching of fine seeds and good methods, the integration of agricultural machinery and agronomy, safe inputs, physical technology and information technology, focus on promoting new high-yield, high-efficiency and multi-resistant varieties, large-scale mechanized cultivation techniques and farmland quality construction, make great efforts in controlling fertilizer, pesticides and water, and vigorously implement standardized production. The production of agricultural products should aim at pursuing ecological, green and organic goals. By 2020, China's fertilizer and pesticide utilization rates will increase to more than 40%, and the use of chemical fertilizers and pesticides in grain and agricultural production will achieve zero growth; the recovery rate of waste agricultural plastic film will reach more than 80%. In short, it is necessary both to appropriately use the late-mover advantages of Western modern agriculture in intensification, efficiency and speed, and to fully tap China's early-mover advantages in traditional ecological agriculture of green, organic and circular development. Only by organically combining the two can the sustainability of agricultural development be ensured.

II. Adjusting the Breeding Industry

Crop by-products and their wastes are the main raw materials for the production of the breeding industry, and the abundance or shortfall of the planting industry directly affects the development of the breeding industry. As people's consumption structure shifts from 8:1:1 to 4:3:3, the livestock industry, as the source of meat, eggs and milk, increasingly highlights its special position in ensuring food security. However, at present there are still problems in the development of China's breeding industry that urgently need to be solved. First, the pressure on effective supply is growing. At present, China's per capita meat possession has just exceeded the world average, and per capita milk possession is only 1/4 of the world average. In the period ahead, residents' demand for major livestock products will show rigid growth. Second, the constraints and restrictions on the development of the breeding industry are becoming increasingly obvious. The treatment of livestock and poultry manure has become a prominent problem in the development of modern animal husbandry. In some regions, especially developed coastal provinces and cities in the east, there are more and more cases of prohibiting or restricting livestock and poultry breeding out of environmental protection considerations. The aquaculture industry is affected by the ecological environment, and its natural production capacity has greatly declined. In the 1950s, the Yangtze River catch reached more than 500,000 tons, while in recent years it has been only several tens of thousands of tons. Third, the industry faces severe international challenges. The proportion of large-scale breeding of major livestock species such as pigs, dairy cows, beef cattle and mutton sheep in China is relatively low, and improved breeds of livestock and poultry such as pigs, white-feathered broilers, dairy cows and beef cattle mainly depend on the international market. In particular, due to large price differences at home and abroad, in recent years China's imports of beef and mutton have grown rapidly. China's annual beef consumption is more than 9 million tons, of which imports (including smuggled imports) are more than 2 million tons. Annual milk consumption is more than 50 million tons, while domestic production is only 36 million tons. Imports account for nearly 1/3 of milk demand. Calculated at an average yield of 6 tons per domestic lactating cow, imported dairy products converted into raw milk are equivalent to the annual output of 2.3 million lactating cows. To solve the problem of the rapid and healthy development of China's breeding industry, there are hard constraints related to the long term, such as scientific research and investment, as well as soft constraints related to the present, such as ideas and methods. A change in thinking broadens the horizon, and a change in method shows results. At present, efforts should focus on five adjustments.

1. Adjust grain-pig agriculture and give priority to developing herbivorous animal husbandry. China's meat food is mainly grain-consuming types, supplemented by herbivorous cattle and sheep. The ratio of China's beef and mutton output to pork output is about 1:5, while that of the United States is 6:5. A special economic structure and consumption habits have formed “grain-pig” agriculture. In countries such as Australia and New Zealand, more than 90% of meat products are converted from forage grass, while in China only 6%-8%. Therefore, it is necessary to moderately adjust the relatively surplus production capacity of the pig breeding industry and vigorously develop herbivorous breeding. This can not only change the Chinese dietary structure with excessive fat and reduce various diseases caused by obesity, but also change the current situation of people and livestock competing for grain.

2. Adjust the separation of planting and breeding, and vigorously develop agriculture combining farming and animal husbandry. Vigorously promote circular agriculture combining farming and animal husbandry, open up the channel for coordinated development of planting and breeding, and promote turning waste into treasure and circular utilization, solving both the “input” feed problem for livestock and poultry and the “output” manure and urine problem. It is necessary to fully tap the production potential of forage and feed, vigorously develop grass-based animal husbandry, and form a new type of planting and breeding structure that balances grain and grass, combines farming and animal husbandry, and develops circularly. Actively promote the production of feed grain. In major grain-producing areas, according to the requirement of “determining planting by breeding,” actively develop feed corn, silage corn, etc., develop the planting of high-quality forage grass such as alfalfa, and promote the coordinated development of the three-way planting structure of grain, cash crops and forage. Support breeding entities in establishing planting bases to absorb manure. Encourage the close integration of livestock and poultry manure treatment and utilization with biogas projects, actively promote the production, processing and utilization of organic fertilizer, and make planting and breeding mutually reinforcing and jointly developing in a virtuous cycle.

3. Adjust breeding methods and maximize the use of by-products and wastes from the planting industry. People eat plant fruits, animals eat roots, stems and leaves, and human and livestock manure is returned to the field as crop fertilizer. This is the food chain distribution law arranged by nature and cannot be surpassed. From the practice of cattle and sheep breeding, coarse feed such as crop straw is needed every day. The demand of cattle and sheep is 2.5% of their own body weight. One beef cow raised to slaughter in two years needs to consume 5 tons of straw coarse feed, and one sheep raised to slaughter in the same year needs to consume 500 kg of straw coarse feed. Therefore, raising livestock with straw has broad prospects. Improper breeding methods not only cause people and livestock to compete for grain, but also affect the healthy development of animal husbandry. According to estimates by relevant experts, China's current ratio of concentrated to rough feed for dairy cow feeding is 6:4. If adjusted to 3:7, the life cycle and reproductive capacity of dairy cows will be greatly improved. Improper feed ratios seriously constrain the development of dairy cows, thereby affecting market supply and forcing large imports of dairy products. (Continued on page 84) (Continued from page 79) Therefore, the state should issue incentive policies. When livestock breeding enterprises, large households and cooperatives use wheat, rice and corn straw up to a certain proportion, they may enjoy reward and subsidy policies for straw utilization, and special machinery for livestock breeding should be included in the scope of agricultural machinery purchase subsidies. Stabilize the development of herbivorous animal husbandry in grassland areas, encourage agricultural areas and semi-agricultural areas to accelerate the development of herbivorous animal husbandry, promote large-scale breeding of beef cattle, mutton sheep and dairy cows, accelerate the promotion of straw silage, ammoniation and fermentation technology, support the development of a number of straw feed processing enterprises, and do everything possible to improve the level of straw feed utilization.

4. Adjust the breeding structure to enrich the various needs of people's lives. According to the resource endowments, industrial foundations and breeding traditions of different regions in China, continuously adjust and optimize the breeding structure in response to market demand. It is necessary both to stabilize pig and poultry production, and to vigorously develop cattle and sheep, and also to actively develop aquatic products such as fish, shrimp and crabs. Pig and poultry production should be concentrated in major grain-producing areas to improve the conversion rate of crops and their by-products and wastes. Dairy cow breeding should still be mainly in the north, accelerate development in the south, and make full use of straw resources in the south. For beef cattle production, pastoral areas and semi-agricultural and semi-pastoral areas should be the main breeding areas, and major grain-producing areas should concentrate on fattening, striving to improve breeding efficiency. For mutton sheep production, insist on developing both agricultural and pastoral areas, with wool and cashmere sheep breeding mainly in the Northeast and Northwest regions, giving play to their respective comparative advantages. Aquaculture should protect the ecology and purify water bodies on the one hand, and on the other hand restrict the damming of rivers to prevent the food chain from being broken. Hubei is the producing area of the four major Chinese carps. Once the Three Gorges Dam was built, fry output plummeted from the original 20 billion to 200 million. Since the 1960s, the United States has been demolishing dams in a planned way to solve food chain problems, demolishing 50-60 dams per year, while China is vigorously promoting dam construction.

5. Adjust the breeding vision and vigorously develop microbial products. Many countries around the world are cultivating the biological industry as a new economic growth point and accelerating their capture of the commanding heights of the “bioeconomy.” In 2013 alone, the global output value of biopharmaceuticals reached 199.7 billion USD, and it is expected to reach 497.9 billion USD by 2020. In 2013, the global scale of biomanufacturing reached 170 billion USD. The U.S. Department of Agriculture predicts that by 2025, 22% of global chemical products will be made from biological raw materials. The OECD predicts that by 2030, 35% of chemicals and other industrial products will come from industrial biotechnology. Facing the rapid development of the bioeconomy, China plans to take a curve-overtaking approach, with total output value expected to reach a scale of 1 trillion to 1.1 trillion by 2020. In the practice of production and life, humanity has studied and utilized animals and plants more, while paying insufficient attention to microorganisms, the behind-the-scenes protagonists in the ecosystem, and their development and utilization are far from sufficient. Thinking should be adjusted, transforming the “two-dimensional agriculture” that develops and utilizes traditional animal and plant resources into “three-dimensional agriculture” that develops and utilizes animal, plant and microbial resources. Relevant experts summarize microbial agriculture into six major aspects. First, microbial feed; second, microbial fertilizer; third, microbial food; fourth, microbial pesticides; fifth, microbial energy; sixth, microbial environmental protection agents. Fully developing and utilizing the six major functions of microbial agriculture, making microorganisms change from “micro” to “great,” and giving them the same attention as animals and plants, should be a new field of agriculture in the 21st century.

III. Upgrading the Processing Industry

The planting industry and the breeding industry together provide raw materials for the agricultural product processing industry. The agricultural product processing industry is the sum of industrial production activities using artificially planted and bred or wild animal and plant resources as raw materials. The agricultural product processing industry is a strategic pillar industry for economic and social development, an important livelihood industry for ensuring national nutritional security and health, and the central link in promoting the integrated development of the primary, secondary and tertiary industries of agriculture. By the end of 2014, there were 75,700 agricultural product processing enterprises above designated size nationwide, completing main business revenue of 1.848 billion yuan. The ratio of the output value of the agricultural product processing industry to agricultural output value rose from 1.1:1 during the “Tenth Five-Year Plan” period to about 1.7:1 at present.

However, compared with developed countries, the overall development level of China's agricultural product processing industry is still very low, and there are still many problems that urgently need to be solved. First, the product value-added rate is low. The value added by China's agricultural product processing industry is less than two times, while in developed countries it is 5-8 times. The ratio of the output value of China's fruit and vegetable processing industry to the output value of raw materials is 0.43:1, while in developed countries the value added is more than 3 times. Second, the comprehensive utilization rate of resources is low. It is estimated that for plant fiber resources alone, China has about 500 million tons of straw each year that can be comprehensively utilized. At present, however, not only is the proportion of these resources developed and transformed extremely small, but they have even become a source of environmental pollution. From the perspective of the variety and categories of processed products, the categories are relatively few and the varieties are monotonous. Taking special flour as an example, Japan has more than 60 types, the United Kingdom has more than 70 types, and the United States has more than 100 types, while China has only about 20 types. In edible oil, Japan has more than 400 types of special oils and fats, while China has only a few. Third, the scientific and technological innovation capacity is low. There is a lack of scientific reserves and technical support adapted to the development of the agricultural product processing industry, such as supercritical fluid extraction, ultrafine grinding and membrane separation technologies, which are rarely applied. The low capacity for technological innovation, especially the lack of technologies with independent intellectual property rights, is the fundamental reason why China's agricultural product processing lags behind developed countries. Promoting the rapid, stable and healthy development of the agricultural product processing industry has become a major task in building China's agricultural modernization and enhancing agricultural competitiveness.

First, top-level design should be done well. The state should, from a strategic and overall height, place the agricultural product processing industry, as a strategic pillar industry with huge potential and a new economic growth point, in an important position, put it on an important agenda, increase support, and promote the integrated development of the primary, secondary and tertiary industries of agriculture. At present, top-level design should be strengthened at the national level. While strengthening product research and development on the one hand, industrial construction should also be strengthened on the other. A policy document should be formulated to make arrangements for the development of the agricultural product processing industry, especially to propose targeted and operable policy measures addressing the main difficulties and problems constraining its development. It is necessary to plan and build four processing industry systems, namely the grain and agricultural by-product processing industry system, the livestock and aquatic product processing industry system, the forest and forest product processing industry system, and the crop straw and waste processing industry system. It is necessary to recover the other half of agriculture; 600 million tons of grain similarly produce 600 million tons of straw dry matter.

Second, focus on promoting industrial transformation and upgrading. This is an important and urgent task at present and for a period to come. It is necessary to adhere to the main line of transforming the development mode, adjusting and optimizing the structure, and improving quality and efficiency, and vigorously promote accelerated development in key areas such as primary processing, deep processing, comprehensive utilization, staple food processing, new formats and new models, technical equipment, leading enterprises, brand strategy, processing parks and processing industries in main production areas, and guide and promote the transformation of the agricultural product processing industry from scale expansion to transformation and upgrading, from factor-driven to innovation-driven, and from dispersed layout to industrial clusters.

Third, vigorously implement the “four qualities” strategy. The “four qualities” are appearance, quality, taste and brand. So-called appearance means that the product's external form should have aesthetic appeal and should look good; so-called quality means that the product must ensure its texture; so-called taste means that the product must accurately target the consumption level and be produced in categories for high-, middle- and low-end markets. Today's services have developed from mass service, segmented service and niche service to personalized service, with each person having a different taste. There should be as many varieties as possible to meet the needs of different groups, especially middle-class consumption, which is characterized by freshness, individuality and not following the crowd. Attention should be paid to discovering niche products, which have the highest added value; so-called brand means creating one's own label to increase visibility and reputation. The internet age is the age of brand supremacy. The character “pin” (quality/taste) has three “mouths”; a so-called brand is a label jointly established through people's word of mouth, in tasting, evaluating and appraising. It arises from the senses and exists in people's hearts. Humanity has entered the brand era. People regard food as heaven, and the first “quality” brand is agriculture. Therefore, building brands, protecting brands and developing brands are key tasks in accelerating the agricultural product processing industry. Efforts should be made to build brand products, brand enterprises and brand industries. Foreign herbal medicines are rushing to beachheads in the original producing country of Chinese medicine, racing to set standards, racing to register patents and racing to seize the market. In 2014, foreign herbal medicines sold 5 billion yuan in the mainland, accounting for 1% of domestic Chinese medicine sales. Artemisinin is the only drug in China included in the World Health Organization's Model List of Essential Medicines, but foreign products of the same kind have applied for the patent. At present, annual sales of this drug and its derivatives reach 1.5 billion USD, while China's market share is less than 1%. China's native medicine has become a money tree for foreign countries. Germany has more than 2,000 world-famous brands and more than 100,000 international industrial standards. Japan has 100,000 century-old shops and 8 millennium-old shops. China so far has not a single century-old brand that has never been interrupted. International standards for processed products are even less worth mentioning. In the world brand products published by U.S. BusinessWeek since 2006, among China's more than 15 million enterprises and more than 1.7 million brands, none has yet made the list. The first thing to attach importance to in brands is food safety. Ren Zhushan, former Deputy Under Secretary of the U.S. Department of Agriculture and a Chinese-American expert, said that food in the United States is supervised by the Food Safety and Inspection Service under the Department of Agriculture. For example, every slaughterhouse has an inspector, 8,000 nationwide. Without the inspector's approval, products cannot leave the factory. The inspectors are completely independent; if they eat a meal at an enterprise, they lose their job.