Expert warns of labour shortage in Chinese pigmeat sector
Policy makers are expected to announce reforms to China’s Soviet-era residency card system in October, which could allow millions of rural families to become urban residents, Dr Kevin Chen, head of the International Food Policy Research Institute (IFPRI) in China said yesterday (July 16).
This, he believes, would lead to a new wave of small-scale pig farmers exiting the sector, which has this year already seen a loss of capacity during a current trough in China’s highly cyclical pork prices.
The problem is that pig farming is labour intensive, he told a meeting at the Dutch embassy in Beijing. With workers leaving for the cities, or threatening to leave, “farmers often keep their land use rights but they don’t want to keep pigs because you have to physically be there to look after them, so instead they grow grains,” he said.
And even for farms without such labour problems, feed supply issues remain and will be the biggest barrier to an increase in scale on Chinese pig farms. “A more commercialised pork sector means more demand for feed and that means more land and where will that come from?” asked Dr Chen.
A key to that may be consolidation of land. China’s government has encouraged smallholders to transfer or pool their small plots of land, which are technically held with usage rights rather than owned outright. According to Dr Chen, some 27% of the nation’s arable land bank has been transferred or amalgamated to date, enabling more efficient planting and larger harvests.
Also, a potentially positive side to labour losses could be that they inspire food production mechanisation, a key government goal for the past 30 years. This would be an easier sell for officials if a previously abundant supply of cheap labour dries up: “It’s the right time to achieve mechanisation which will help improve crop yields,” said Chen.
Demography is another issue facing China’s pig and feed sectors. The current average age of Chinese farmers is 55, meaning in 15 years many of them will have retired and in most cases their children are not keen to be farmers, and most of them lack the experience or training in agriculture since they’ve already in many cases moved to city jobs and will not be coming back to the countryside.”
The current average size of Chinese farm holdings – six hectares – means farms are also less attractive propositions for would-be returnees.