What will be the changes in the livestock product market in the next decade?

Is the food supply situation in China sufficient under the epidemic? What will be the development trend of major agricultural product markets in the next decade? What changes will occur in the production and trade of international agricultural products? The "China Agriculture Outlook Report (2022-2031)" (hereinafter referred to as the "Report") was recently released, introducing the market situation of 18 major agricultural products such as rice, wheat, corn, and soybeans in 2021, and looking forward to the production, consumption, trade, and price trends of major agricultural products in the next 10 years. The report states that in the next 10 years, the foundation of agricultural development will become more solid, decisive progress will be made in the comprehensive revitalization of rural areas, the modernization level of agriculture and rural areas will be significantly improved, the effective supply of important agricultural products such as grain will be effectively guaranteed, and the upgrading of agricultural product consumption will be significantly accelerated.

Effective supply of grain varieties expected to be updated and replaced

The report points out that, benefiting from the continuous efforts of agricultural policies, the planting area of grain is expected to stabilize at over 1.75 billion mu in the next 10 years, of which the grain area is stable at around 1.45 billion mu, the grain ration area is stable at over 800 million mu, and the soybean area is expected to expand to 200 million mu; The sowing area of oil crops will reach 226 million acres.

In the next 10 years, China's supply capacity for green and high-quality agricultural products will significantly increase. The production of high-quality japonica rice and strong and weak gluten high-quality specialized wheat will steadily increase. The production of corn and soybeans will reach 324 million tons and 35.07 million tons respectively. Basic self-sufficiency of grains and absolute food security can be fully guaranteed. The self-sufficiency rate of grains will increase to about 88%, pork production will remain stable at around 56 million tons, dairy production will reach nearly 54 million tons, and aquatic product production will reach 71 million tons.

With the deepening implementation of the seed industry revitalization action, it is expected that grain varieties will undergo a round of renewal and upgrading, and the guarantee of facility conditions will continue to strengthen. About 1.2 billion mu of high standard farmland will be built, and technological production will become more powerful. It is expected that the grain yield level will increase by 6.4% during the outlook period.

Rice: In the next 10 years, the overall production of rice will remain stable, with a slight decrease in sowing area and a gradual increase in yield per unit area. The rice yield will remain stable at over 210 million tons. With the continuous upgrading of food consumption by residents, rice consumption is showing a stable to slightly decreasing trend, and the overall consumption will still remain at about 210 million tons; Grain consumption continues to decline, but its proportion in rice consumption remains above 69%. Feed consumption will show a trend of first decreasing and then increasing with the development of animal husbandry and changes in feed cost prices. The overall supply and demand relationship of rice is in a relaxed trend, and rice imports mainly meet the demand for variety adjustment.

Wheat: In the next 10 years, the layout and quality structure of wheat production areas will continue to be optimized, the sowing area will remain stable at around 350 million mu, the yield level will continue to improve, and the yield will steadily increase. By 2031, it will reach 144.71 million tons. With the gradual increase in corn production, the price ratio between wheat and corn will remain within a reasonable range, and the consumption of wheat feed will fall back to the annual level. However, the growth space of industrial consumption is still large, and the overall consumption of wheat will first decrease and then increase. China will still import some specialized wheat for variety adjustment needs, but with the continuous improvement of domestic high-quality wheat production level, the import demand for high-quality specialized wheat will decrease.

Corn: In the next 10 years, the planting area of corn will first decrease and then increase, and is expected to stabilize at 650 million mu by the end; With the continuous optimization of corn planting mode, the promotion and application of breeding technology and field management technology, the yield level has steadily increased, with an expected annual growth rate of 1.7%; The increase in production mainly comes from the contribution of unit yield, and it is expected that the corn production will reach 323.93 million tons by 2031, with an average annual growth of 2%. Due to the continued growth but slowing growth of corn feed consumption and strong industrial consumption demand, corn consumption has maintained a rigid growth. It is expected that corn consumption will reach 32.821 million tons in 2031, with an average annual growth rate of 1.5%. The supply and demand relationship of corn will gradually shift from a tight to a basic equilibrium pattern, and the import volume will stabilize after decreasing. It is expected that the import volume will decrease to 7.57 million tons by 2031.

Continuous growth in meat production and consumption, increasing self-sufficiency rate

The report shows that meat production and consumption have increased in 2022, and the price trend is relatively mild. The overall situation of livestock and poultry production in 2022 is good, with a slight increase in meat production, expected to reach 92.06 million tons, an increase of 2.3% compared to the previous year; Consumption is expected to increase steadily, with an estimated 97.79 million tons, an increase of 0.5% compared to the previous year; Imports have significantly decreased, with an estimated 6.34 million tons, a decrease of 20.2% compared to the previous year. The market supply is relatively sufficient, the product's external dependence is further reduced, and the overall operation of the market is relatively stable. In the long run, production and consumption have steadily increased, while imports have decreased.

In the next 10 years, with the industrial transformation and upgrading, the development trend of industrial scale, intensification, and intelligence will accelerate. The production capacity of livestock and poultry will gradually increase, and the output will steadily increase to 96.85 million tons, but the growth rate will slow down, with an average annual growth rate of 1.7%. The production structure will gradually adjust, and the proportion of pork will decrease; With the improvement of urbanization level and the increase of residents' income level, the consumption will show a stable and increasing trend, reaching 101.27 million tons in 2031, with an average annual growth of 1.4%. The consumption structure will continue to optimize, and the proportion of beef, mutton, and poultry consumption will increase; The domestic meat industry has increased production and capacity, and the self-sufficiency rate of meat products is constantly increasing. Imports are showing a downward trend, with an estimated import volume of 5.09 million tons by 2031. Without the impact of major emergencies such as epidemics, the fluctuation range of meat prices has narrowed.

Pork: The expected pork production in 2022 is 54.5 million tons, an increase of 2.9%, with a total output of 694 million heads, an increase of 3.4%; The estimated import volume of pork is about 2.5 million tons, a decrease of 32.3% compared to the previous year; The consumption and per capita share of pork will be at a historically high level, with 56.91 million tons and 40.3 kilograms respectively, both increasing by 0.6% compared to the previous year; The prices of live pigs and pork were sluggish in the first half of the year, and will gradually approach the normal price level in the second half of the year.

In the next 10 years, the increase in scale level, industrial concentration, industrial chain improvement, and optimization of regulatory policies will enhance the stability of pork supply. The average annual growth rate of China's pig slaughter and pork production will reach 1.9% and 2.1% respectively. It is expected to reach 699 million heads and 55.91 million tons respectively by 2031; The total consumption and per capita share are generally stable, and are expected to reach 56.99 million tons and 40.19 kilograms respectively by 2031. In terms of international trade, stable domestic supply will gradually reduce the demand for pork imports. It is expected that pig prices will enter a new price cycle in 2023, but with an increase in scale, the fluctuation range of pig prices will significantly decrease compared to the previous two cycles, and pig prices will experience narrow fluctuations.

Poultry meat: In 2022, due to the historically high inventory of fast growing white feathered broilers, the production capacity of yellow feathered broilers and white feathered ducks has been basically reduced, and it is expected that the production will continue to increase slightly to 23.94 million tons, an increase of 0.6% compared to the previous year; As the price of live pigs falls, the space for replacing poultry meat consumption continues to compress, resulting in a decrease in consumption volume; It is expected that the import volume will significantly decrease and the export volume will remain stable; Due to the dual impact of feed costs and a slight decline in consumption, prices have remained stable or slightly decreased.

In the next 10 years, with the optimization of the layout of the meat and poultry industry, the proportion of integrated breeding increasing, and the improvement of breeding technology, the production will maintain a growth trend, but the growth rate will gradually decline, with an average annual growth rate of 1.2%. By 2031, it will reach 26.34 million tons. The public's consumption concept of poultry meat is becoming increasingly mature, the product structure is continuously optimized, processing technology is gradually improving, and the supply of high-quality and distinctive differentiated products continues to increase. The consumption of poultry meat continues to increase, with an expected annual growth rate of 0.9%. It is expected to reach 26.39 million tons by 2031; Poultry meat maintains basic self-sufficiency, and imported poultry meat products are mainly concentrated in chicken wings and chicken feet. The import volume first decreases and then stabilizes, and the export destinations increase. The types of exported poultry meat products are diverse, and exports continue to grow slightly. It is expected that the import and export volumes will reach 580000 tons and 530000 tons respectively by 2031; The cost of artificial and environmental protection in meat and poultry farming has been increasing for a long time, and the fluctuation of feed costs has intensified. The price of poultry meat will fluctuate upwards.

Beef and mutton: In 2021, driven by favorable policies such as the "Grain to Feed" policy and the pilot program for policy based insurance for beef and mutton, the production continued to increase. The production of beef and mutton was 6.98 million tons and 5.14 million tons respectively, an increase of 3.7% and 4.4% compared to the previous year; Consumption has steadily increased, reaching 9.31 million tons and 5.55 million tons respectively, an increase of 5.3% and 4.9% compared to the previous year; Imports continued to increase, reaching 2.3328 million tons and 410700 tons respectively, an increase of 10.1% and 12.5% compared to the previous year; The price remained at a high level, with an average market price of 86.52 yuan/kg and 84.28 yuan/kg respectively, an increase of 2.9% and 4.6% compared to the previous year.

During the outlook period, with the high-quality development of the cattle and sheep industry, the industrial quality and production level have steadily improved, the degree of specialization and scale has increased, and the industrial development continues to improve. It is expected that in 2022, the production will be 7.1 million tons and 5.23 million tons respectively, an increase of 1.7% and 1.8% compared to the previous year; In 2031, it was 7.72 million tons and 5.71 million tons respectively. Driven by the upgrading of household consumption, consumption continues to grow, but due to the impact of aging and the turning point of the total population, the growth rate of consumption will gradually slow down in the middle and later stages. The supply capacity will gradually improve, coupled with the slowing growth rate of consumption, imports will remain stable.

The upgrading of agricultural product consumption is accelerating, and prices are showing an upward trend

The continuous growth of income and the expansion of animal husbandry production have significantly driven the upgrading of household consumption. During the outlook period, the demand for grain has shown a downward trend, with feed demand exceeding domestic production capacity. The average annual growth rate of corn consumption is 1.5%; The annual average consumption of meat, dairy products, vegetables, fruits, and aquatic products has increased by 1.4%, 4.1%, 0.9%, 1.97%, and 0.9%, respectively. Among them, the annual per capita consumption of poultry, beef, lamb, poultry eggs, dairy products, and aquatic products will increase to 18.61 kg, 7.45 kg, 4.35 kg, 25.52 kg, 63.2 kg, and 44.6 kg, respectively.

The trade of agricultural products will continue to remain active, and there will be significant changes in the quantity of imports and exports. Due to rigid constraints such as arable land and water resources, the supply and demand of grain will continue to be in a tight balance in the medium to long term. China will still be the main importer of many agricultural products, but due to consumption growth being lower than production growth, most agricultural product imports are showing a significant downward trend. Rice and wheat imports are still mainly based on variety adjustment, while corn imports will significantly decrease from historical highs in recent years, with an average annual decline of 6.5%, soybean imports with an average annual decline of 1%, and grain imports reduced to 126 million tons; The import of pork has decreased to 1.2 million tons, with a decrease of over 50% in the outlook period, and the import of edible vegetable oil has decreased by about 20% during the same period.

The overall price of agricultural products is showing an upward trend, and agricultural products with high import dependence are greatly affected by international market fluctuations. The increase in production costs such as labor and material inputs is an important support for agricultural product prices. The prices of rice and wheat will slightly increase, while the high quality and favorable prices will become more apparent; Agricultural products such as corn, soybeans, cotton, sugar, and edible vegetable oil have strong linkage with the international market, and their prices are easily affected by fluctuations in the international market; The prices of fresh agricultural products such as meat, eggs, milk, vegetables, fruits, and aquatic products are generally rising due to cost driven and demand driven factors. Cyclical factors and unexpected events are still the main reasons for price fluctuations.

笔记