Chinese five-year plan impacts on meat industry

By Chloe Ryan

- Last updated on GMT

The five-year plan allows for highly skilled farmers to operate large farms and improve productivity
The five-year plan allows for highly skilled farmers to operate large farms and improve productivity

Related tags Agriculture China

China’s 13th five-year plan, published by the government in Beijing, has revealed policies that could have major benefits for meat and animal feed exporting nations around the world.

The document, covering China’s overall strategy for the period 2016 to 2020, has gained worldwide attention partly because of the decision to abandon the decades-long one-child policy.

But the document has also revealed the country will make a major shift in its approach to food, including the decision to increase imports rather than continue to grow its farming capacity. For the past 11 years, China has steadily increased grain production, but agriculture minister Han Changfu said the country would now aim for stable output and quality products, according to the state-run news outlet China Daily.

Animal feed

As a result of population growth and increasing prosperity, demand for grain in China is expected to rise from 600 million tonnes in 2014 to 700m t in 2020. The gap of 100m t – much of it animal feed – will be filled by imports.

Earlier this year, China drew attention for the dramatic decline in the Chinese hog and sow herd that was described by analysts at Rabobank as “astonishing”​. Over the last 18 months, China’s pork industry has experienced one of the largest culls on record and Chinese pork production is forecast to drop by 3.7m t (6.5%), to 53m t in 2015.

According to a professor of agricultural economics at Renmin University of China, quoted by analyst China Ag, there is a strong likelihood China will see increased imports of soybeans, corn, meat, and milk as a result of the change in policy.

'Agricultural reform'

China also announced in the five-year plan a push to radically change the way it produces food domestically. China Daily reported the country was “about to enter its second major period of agricultural reform since the 1980s, with the goal of shifting to large farms and ‘professionalised’ farmers who are more productive than those working on a small scale”​.

In 30 years, about 85% of China’s supply of farm products will be provided by 7% of its labour force, Zou Lixing, a research official with China Development Bank, told China Daily. By comparison, in the US, virtually the whole country’s market of farm products is sustained by only 1.5% of its labour force, Zou said.

For the past 2,000 years, small-scale farmers in China have provided the nation with most of its food. The five-year plan allows for improved property rights in rural China, a major shift for a communist nation, which will allow highly skilled farmers to operate large farms and improve agricultural productivity.

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