Singapore targets for growth in fish farming

Singapore’s Agri-Food & Veterinary Authority (AVA) is to invest in aquaculture and agriculture to improve technology and research and improve food availability. Over the next five years the AVA wants to raise fish production from 4% to 15%. Singapore’s largest commercial fish farm, the 18-month-old Barramundi Asia, is considering applying for a loan to improve its aquaculture technology and increase its annual production of barramundi – or Asian sea bass – to 3,000 tonnes by 2012, and 20,000 tonnes by 2020.

Vietnam’s imports more raw material from Argentina

Vietnam’s soybean meal and animal protein meal imports from Argentina jumped both in quantity and value during January to October, reflecting rapid expansion of the country’s feed industry. Sbm imports from Argentina during the period soared 155% in quantity to 932,678 tonnes and 235% in value to USD 347.4 million tonnes. Animal protein meal imports from Argentina during the period surged 49% in quantity to 70,051 tonnes and 19% in value to USD 44.7 million.  Over half of this amount was beef powder. Its import increased 75% in quantity to 49,028 tonnes and 103% in value to USD 20.3 million. Other meal imports in the period included 9,389 tonnes of chicken powder valued at USD 4.9 million and 2190 tonnes of cow by-products valued at USD 3.5 million.

Information from Asian Agribusiness Group

Thailand – Poultry and Products Annual 2009 Due to strong demand at home and in epxort markets, Thai broiler meat production is forecast to grow by four per cent in 2010, according to the latest GAIN report from the USDA Foreign Agricultural Service.

Executive Summary

Thailand’s broiler meat production is forecast to grow modestly by four per cent in 2010 in anticipation of higher demand both domestically and internationally, and assuming that there will be no serious disease issues, especially avian influenza, in the country. This across-the-broad increase is mainly attributed to an anticipation of a global economic recovery.

The EU and Japan will remain major markets for Thai chicken meat exports (all of it cooked product) in 2009 and 2010, accounting for 85 to 90 per cent of total exports. Other importing countries include Vietnam, Singapore, South Korea and Hong Kong.

The EU recently notified WTO of its plan to raise import tariffs on eight items of poultry meat products. These include uncooked chicken meat products containing more than 57 per cent chicken meat, cooked chicken meat products containing 25 to 57 per cent chicken meat, and cooked chicken meat products containing less than 25 per cent chicken meat. These chicken meat products are currently not under the EU tariff-rate-quota. However, the plan has not been finalised by the EU thus far. Additionally, Thai exporters have requested the Department of Trade Negotiations (DTN) of the Thai Government to discuss with the EU a possible increase in current quota ceiling and import tariffs during the months of September or October 2009.

Production trends

Thailand’s broiler meat production is forecast to grow modestly by four per cent in 2010 in anticipation of higher demand both domestically and internationally and assuming that there will be no serious disease issues, especially avian influenza, in the country.

Broiler meat production for 2009 is likely to register a two per cent growth over the 2008 level to 1.2 million metric tons. A low growth in broiler production in 2009 is a reflection of the global economic downturn that is affecting both export and domestic demand. An average amount of chick production in 2009 is estimated at 18 million birds per week, accounting for three-quarters of the country’s production capacity. This idle capacity has minimal effects on the industry’s production costs.

Thai broiler industry’s farm facilities, breeding farms and broiler farms in particular, expanded substantially in early 2002-2003, shortly before Thailand was hit by High Pathogenic Avian Influenza (HPAI), H5N1 type, in January 2004. The disease incidence caused both export demand and domestic consumption to plunge in 2004. After demand recovered in 2005, independent chick producers and broiler integrators have monitored the market closely and cautiously adjusted their chick production to reflect the actual demand. As a result, broiler production has fluctuated in a lesser degree in recent years than in the past.

In addition to supply management, the Thai broiler industry has successfully improved farming systems to encounter animal health and food safety challenges. All integrated producers are currently strictly implementing biosecurity measures across the board, from the farm level to the processing level.

Nearly all broiler houses of integrated producers are installed with an evaporative cooling system, which leads to higher productivity and reduced disease exposure and mortality rates.

In addition, Thai chick producers have continued to improve genetics in broiler breeding stocks so that average meat yields per bird have increased in recent years. Integrated producers have also invested money to introduce or improve their broiler meat processing facilities from slaughtering to cooking processes. Accordingly, Thailand is currently considered one of the premium suppliers for cooked chicken meat products to Japanese and EU customers.

Production costs

Trade sources forecast that production costs of live broiler in 2010 should increase to some degree in anticipation of stronger prices for bulk feed ingredients.

Trade sources forecast that production costs of live broiler in 2010 should increase to some degree in anticipation of stronger prices for bulk feed ingredients. In 2009, a reduction in domestic and international prices for feed ingredients and chicks have benefited the Thai broiler industry.

For example, prices for corn and soybean meal, ingredients that account for 85 to 90 per cent of the broiler feed ration, have dropped six per cent (from average 17.78 baht (THB) per kg to THB16.30) for corn and 23 per cent (from THB9.32 baht/kg to THB7.17) for soybeans in the first seven months of 2009 (Jan-Jul) compared to the same period in 2008. Domestic wholesale prices for chipped tapioca, a carbohydrate-source substitute material, also declined sharply by 29 per cent from THB5.84 per kg to THB4.13. In addition, chick prices in the first seven months (January to July) dropped sharply by 27 per cent to THB9.84 baht per bird (28 cents per bird).

As a result, average live broiler production costs in the first seven months of 2009 (January to July) are estimated to drop by 17 per cent from THB37 baht per kg (48 US cents per pound) to THB31 baht per kg (40 cents per pound). As of August of 2009, current average production costs are THB32 to 33 baht per kg (42 to 43 cents per pound), which is broken down as follows: day-old chicks (THB7), feed (THB21 to 22), vaccination and drugs (THB1), and labour and other costs (THB3).

HPAI update and its effect on broiler output

High pathogenic avian influenza (HPAI), H5N1 type, hit Thailand in January 2004 and the outbreak has occurred from time to time each year.

According to Thai officials and trade sources, the outbreak of HPAI in Thailand has been much lesser as of late. Only two premises raising native chickens in Sukhothai and Uthai Thani provinces reported positive for HPAI in October and November 2008, respectively, and only 14 chickens were destroyed on these two sites.

In addition to the ‘stamping out’ practice, the Department of Livestock Development (DLD) conducted other control measures including quarantine, movement control, screening, zoning, disinfection of infected premises or establishment, following OIE guidelines. Thailand has had no HPAI incidents since the last affected flock was depopulated on 12 November 2008.

Consumption

Domestic broiler meat consumption in 2010 is forecast to increase by five per cent due to the recovery of the Thai economy and poultry meat prices remains the cheapest meat. In addition, an increase in domestic consumption should be partly attributed to an effort to promote new ready-to-eat chicken menu in domestic market by quick service restaurants (QSR) and food processors, including the largest poultry integrators such as Charoen Pokphand Group. In 2009, growth in broiler meat consumption is estimated to register a one per cent increase due to the economic downturn.

Average domestic prices for live broilers in the first seven months of 2009 (January to July) dropped 11 per cent over the same period of 2008 to THB34.04 per kg (approx. 44 cents per pound) due mainly to decreased production costs. Meanwhile, average retail prices for chicken boneless breast meat in Bangkok in 2009 (January to July) decreased by 23 per cent to THB68.97 per kg ($0.90 per pound) from the 2008 level.

Trade

Export trends

Thailand’s exports of cooked chicken meat are forecast to grow by seven to eight per cent in 2010 due to an anticipated recovery in the economy of importing countries, especially the EU and Japan.

Chicken meat exports (both cooked and uncooked) in the first half of 2009 reportedly dropped by two per cent from 178,721 metric tons in the same period of 2008 to 174,764 metric tons. However, based on the export performance of the first half of 2009 and the anticipation of improved exports in the second half of the year, total exports of chicken meat should register a growth of two per cent in 2009. This slow growth is a result of the global economic downturn.

In 2009 and 2010, the EU and Japan will remain major markets for Thai chicken meat exports (all cooked product) accounting for 85 to 90 per cent. Other importing countries include Vietnam, Singapore, South Korea, and Hong Kong.

Export prices and products

There are no export price quotations on basic uncooked items such as boneless leg (BL) and skinless boneless breast (SBB) from Thailand. Trade sources report that export prices in 2009 continue to be profitable. Under the EU quota, several importers in the EU have been sourcing more products from Thailand and Brazil. In addition, concerns about the quality of Chinese food products have benefited Thai poultry exports, particularly to Japan.

Trade sources reported that the global economic downturn is affecting export prices in the EU market at a higher degree than prices in the Japanese market. Export prices for steamed dice-shape-cut skinless boneless breast (SBB), a major item exported to the EU, declined sharply from $4,000 to 4,500 per ton CIF in 2008 to the current price of $3,000 to$3,500. On the other hand, export prices for fried cut boneless leg, one of the basic cooked products to the Japanese market, dropped in a lesser degree from $ 4,200 to $4,300 per metric ton to $4,000 to 4,200. However, export prices are expected to improve by five to 10 per cent in the last quarter of 2009.

The bulk of the cooked chicken products consist of made to order meat products that are processed or prepared by heat (such as grilling, steaming, boiling, etc.) and are usually puffed or seasoned (with salt, Japanese sauce, etc.).

EU quota administration

Under the agreement, Thailand receives 92,610 tons, out of a total quota of 264,245 tons, for salted poultry meat (EU HS code 02109939). The in-quota tariff rate is 15.4 per cent while the out-of-quota rate will be €1,300 per ton. Quota for cooked chicken meat (EU HS code 16023219) for Thailand is 160,033 tons, out of a total quota of 250,953 tons, and in-quota imports from Thailand will be subject to an eight per cent tariff. The out-of-quota rate for cooked chicken meat is €1,024 per ton.

Thailand’s cooked chicken meat (EU HS code 16023219) already reached the quota ceiling of 160,033 tons in 2008. Thailand also exported about 16,000 metric tons of cooked chicken meat products containing no more than 57 per cent chicken meat, which is not under the EU tariff-rate-quota administration, in 2008.

The EU recently notified WTO of its plan to raise import tariff on eight items of poultry meat products, including uncooked chicken meat products containing more than 57 per cent chicken meat, cooked chicken meat products containing 25 to 57 per cent chicken meat, and cooked chicken meat products containing less than 25 per cent chicken meat. These chicken meat products are currently not under the EU tariff-rate-quota. However, the plan has not been finalised by the EU thus far. In response to Thai exporters’ request, the Department of Trade Negotiations (DTN) of the Thai Government plans to hold discussions with the EU on a possible increase in current quota ceiling and import tariff issues in September or October 2009.

Compartmentalisation and export prospects

Thailand is likely to lose its momentum in an effort to pressure major importing countries, i.e. Japan and the EU, to accept the compartmentalisation practice in order to allow Thailand to export raw/uncooked chicken meat to these markets again, regardless of the avian influenza status of the country. The OIE has not issued any official certification on compartmentalisation for the Thai companies that were inspected by the OIE technical expert in mid-2008.

Policy

Thailand’s policy for the poultry industry has not changed from the last report. Thailand does not have price supports or export subsidy programmes for poultry. Because of the HPAI outbreak, the Royal Thai Government (RTG) launched several measures to support the poultry industry, from small-scale farmers to integrated poultry processors. These measures include the HPAI stamping-out campaign on poultry farms/areas, a compensation scheme for disease-affected farmers, fee exemptions for chicken slaughterhouses, and outreach to help unemployed workers/operators.

Thailand is a protected poultry market through the RTG’s use of non-transparent control of import permits (potential importers are unable to get them issued), high WTO bound rates of import tariffs (currently 30 per cent for chilled or frozen uncooked meat and 40 per cent for cooked chicken meat), and a discriminatory import permit fee on uncooked products (approximately $286/ton).

Regarding imported poultry products, Thailand seemingly exceeds OIE guidelines when exporting countries confirm a finding of low pathogenic avian influenza (LPAI) in their country. In the case of live poultry and poultry products, the RTG banned US live poultry and poultry products (both uncooked and cooked) after a finding of LPAI cases in some US states.

DLD has maintained a ban on live poultry and poultry products from Virginia since 24 July 2007.

Marketing

Thailand is a potential market for US chicken parts (especially leg-quarters), mechanically deboned meat (MDM), and value-added chicken meat. Thai local consumers, like those in other Asian countries, prefer dark meat to white meat. Potential buyers for chicken parts and MDM would be food processors (sausage processors in the case of MDM) and supermarkets. Value-added chicken meat can also be introduced to modern retail markets and HRI industry. Thailand could import bone-in-leg meat for processing in Thailand and re-export it to such markets as Japan and non-EU countries. However, the US export opportunities of these chicken parts are currently hindered by Thailand’s non-transparent controls on issuing import permits.

The report : http://gain.fas.usda.gov/Recent%20GAIN%20Publications/POULTRY%20AND%20PRODUCTS%20ANNUAL_Bangkok_Thailand_9-4-2009.pdf

Taiwanese potty-train pigs to lessen pollution: Pig producers in southern Taiwan have started a new initiative to potty-train their pigs in response to a planned water pollution fee, breeders and officials said Monday.

A growing number of farms have established special “toilets” smeared with faeces and urine to attract the pigs to stop them defecating into nearby rivers. Farmers say the results have been very encouraging.

“The pig toilets on my farm help me collect about 95% of all pig waste, making cleaning much, much easier,” Chang Chung-tou, a pig farmer in Yunlin county, told AFP.

The Environmental Protection Administration, which will introduce a new fee on water pollution in the middle of 2010, plans to encourage other pig breeders to begin potty training.

“Apart from Yunlin, we have launched trial pig toilets in Changhua county (in central Taiwan). We are evaluating the results,” an official from the administration said.

Source AFP and PigProgress

World Bank granted more 65 million USD to livestock industry in Vietnam

Pigs breeding has contributed about 71% of total production value of livestock

On 10th December, State Bank of Vietnam and World Bank (WB) has signed credit agreement, through that the WB will grant 65,26 million USD credit, 79,03 million USD of investment for project “Competition and Food safety”

WB said that the main purpose of this project is the settlement of existing and risks which the households of pigs breeding has to face in cycle of fresh meat providing in order to enhance competitiveness for the livestock industry and control food safety in Vietnam.

According to Mrs Victoria Kwakwa, WB Director in Vietnam, this project will help households of pigs breeding sold the meat products of livestock under the conditions cleaner and safer, more meet the growing needs of the Vietnamese about food safety.

This project is deployed to mid-2015.

Currently Vietnam’s agricultural sector to hold 22% of GDP (breeding contribute about 6% to GDP). Pigs breeding contribute a high rate, approximately 71% of total production value of livestock.

Vietnam buys live cattle from Australia

Vietnam has bought 1000 heads of beef cattle from Australia’s Northern Territory worth ASD 1 million (USD 0.905 million) recently. Khanh Hoa Trading and Investment Co, a state-owned firm in Khanh Hoa province, bought the cows from the North Australian Cattle Co. Once delivered, the cows will be sent to the firm’s feedlot in Nha Trang that can hold up to 15,000 cows.The size of the feedlot hints that more live cows, either from overseas or domestic suppliers, would be held for fattening.

Post from Asian Agribusiness

Lower demand pulls down meat processing industry

The Philippine meat processing industry expects its 2009 production volume to drop by 20% from 2008. However, Francisco Buencamino, Executive Director of the Philippine Association of Meat Processors Inc (PAMPI) said that while volume is down, higher prices will still mean a growth in sales, albeit a small one at less that 10%. PAMPI had earlier aimed for an 8-10% increase in sales this year, but Mr Buencamino said that “lower purchasing power of Filipinos” has dampened demand which led to lower volumes. He also said that the industry’s imports of meat raw materials dropped by as much as 28%. Meanwhile, sales of Christmas hams is also seen to slow down this year, as Filipinos tighten their belts. CDO Foodsphere Inc President Jerome Ong said that unlike in previous years, when sales of Christmas hams posted double-digit growths, this year, they are expecting ham sales to increase moderately at about 8-10%.

Post from Asian Agribusiness

Zhongpin Inc., a leading meat and food processing company in the People’s Republic of China, announced it would begin production in its new chilled and frozen pork plant in Tianjin on January 20, 2010.

Zhongpin’s construction of its new chilled and frozen pork processing plant in Tianjin has been accelerated. The new facility will begin initial pork production on January 20. When all the construction phases are completed in 2010, the Tianjin plant will have an annual capacity of 100,000 metric tons for chilled and frozen pork.

Mr. Xianfu Zhu, Chairman and CEO of Zhongpin, said, “We are very pleased that our new pork plant in Tianjin will begin producing in mid January, ahead of schedule, which will help satisfy the nation’s surging demand for chilled and frozen pork during the peak season of the Chinese New Year and Spring Festival, which in 2010 runs from February 14 through February 28 and is also celebrated before and after those dates.

Good market share

We are confident that our high product quality, good retail locations, and dependable pork supply will please our customers in Tianjin, Beijing, and the other markets in northern China who will be served by the new Tianjin plant. We already serve these markets, and our new plant will guarantee better service and broader market coverage. Our timing should give us good market share gains as we expand our presence in this important high-growth region.”

Under China’s five-year plan for 2006 though 2010, the Tianjin Binhai New Area is becoming the country’s third growth-and-development region for the next two decades, just as the Pearl River Delta and Yangtze River Delta regions grew in the past two decades. The government’s support, incentives, and direct investment in infrastructure in the Tianjin Binhai New Area will create new growth for both China’s northern region and its national economy.

In addition, Tianjin serves as the land logistics center and ocean shipping port for much of northern China, so Tianjin, and Zhongpin, will benefit directly from the growth in the region.

China expects its national economy to grow about 9 percent in 2010. That higher growth should help enable higher pork consumption and give Zhongpin additional support for its market expansions.

Mr. Zhu continued, “Our new Tianjin plant will not only serve the northern China market, it also serves another function. In locating, designing, engineering, and constructing the plant and our regional cold-chain logistics network, we have focused on creating the best master template for our future plants and distribution networks. It incorporates all the knowledge and wisdom we have about how to produce and distribute the most outstanding and safest pork products at the most cost-effective prices.

Post from Meat International