Chinese poultry exports on the rise

By Mark Godfrey

- Last updated on GMT

Growth in Chinese poultry exports, especially broiler meat, is well ahead of overall agricultural export growth
Growth in Chinese poultry exports, especially broiler meat, is well ahead of overall agricultural export growth

Related tags Free trade deal International trade Soviet union Russia Poultry

Efforts by Chinese poultry firms to get export market share were given a boost by the news that a major poultry-producing region in eastern China has upped its exports by over 13% year on year in 2017.

Authorities in Liaocheng in Shandong province have reported that they shipped US$102 million-worth of poultry products in 2017, with new access to Malaysia, Canada and South Korea achieved for local firms, as well as access to the Russia-led Eurasia Economic Union.

The 2017 figures appear to be the result of a big push to improve standards. Exports had fallen in recent years, according to the local bureau of the General Administration of Quality Supervision, Inspection & Quarantine (AQSIQ), “due to international trade restrictions and animal disease outbreaks… However we have worked hard to improve the quality and processing systems of local producers​.”

The 120 million broilers produced in the  Liaocheng​ region are reared according to international standards, said AQSIQ, which added it had managed to enrol 49 local breeding companies into various international certification programmes, such as Good Agricultural Practices (GAP) and Good Handling Practices (GHP), which are familiar to US regulators in particular.

Former Soviet states no longer the Chinese dragon's target 

The AQSIQ bureau said it had achieved new access to the EU market for three companies, while a new avenue has opened up in a deal with Mongolia to accept cooked Chinese meat products.

Countries in central Asia and the former Soviet Union – where modern meat processing often remains expensive and underdeveloped – have proven a target for China’s massive processing capacity. Liaocheng has long been a hub for agricultural exports, but these are now slowing as China consumes more at home and cost advantages dry up with the evaporation of cheap rural labour. Meat processors, however, have been mechanising to reduce labour costs: the Shandong Feng Xiang Group last year invested RMB500m in a highly automated chicken processing factory in Liaocheng.

Growth in poultry exports are well ahead of growth in overall agricultural exports, which grew by only 1.53% to US$559m in 2017, but the local AQSIQ office has mounted a publicity campaign echoing national government priorities to improve food production quality: ‘increase quality, innovation and variety’ reads one slogan currently targeting local agribusiness.

The apparent success of local poultry firms comes as Liaocheng has also prioritised use of a new free trade deal with another former USSR state, Georgia. In force since 1 January, it will see zero tariff access for Chinese poultry in exchange for Georgian products like wine coming to China. Interestingly, Liaocheng authorities have listed “frozen chicken​” along with bearings and coated galvanise as local products that will be shipped in greater volumes to Georgia under the free trade deal. Free trade access to Georgia could prove useful, given the country’s location as a distribution hub for Armenia and Azerbaijan, as well as eastern Turkey.

Liaocheng city is located in Shandong province, the same region as Fuxi Nongmu Development Co, a subsidiary of the US-based OSI group that exports chicken products to Afghanistan and Iraq from its facilities near Weihai city.

Chinese poultry firms remain the top supplier of imported chicken to Japan, Hong Kong and Macau, but production has been flat due to a tightening supply of broilers, among other factors. Key western markets include the UK (up 10% year on year to 5,632 tons in 2016) and the Netherlands on 7,252 tons – up 7% year on year in 2016. There was a 10% rise in exports to Afghanistan in 2016 to over 6,500 tons, while exports to Mongolia were up 77% year on year in 2016 to 6,100 tons. 

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