China’s modernized breeding facilities to see hens lay a billion eggs a day

Source:Reuters-Global Times Published: 2018/7/11 17:48:40

Modernized breeding facilities to see hens lay a billion eggs a day




A worker examines the quality of an egg in a smart hen house in Rizhao, East China's Shandong Province Photo: VCG



Behind a row of sealed red incubator doors in a new facility in northern China, about 400,000 chicks are hatched every day, part of the rapidly modernizing supply chain in China's $37 billion egg industry, the world's biggest.

As China overhauls production of everything from pork to milk and vegetables, farmers raising hens for eggs are also shifting from backyards to factory farms, where modern standardized processes are expected to raise quality and safety.

That's an important step in a country where melamine-tainted eggs and eggs with high antibiotic residues have featured in a series of food safety scandals in recent years. It is also spurring demand for higher-priced branded eggs over those sold loose in fresh produce markets.

"These days, if you're a small farmer, your eggs won't get into the supermarkets," said Yuan Song, analyst with China-America Commodity Data Analytics.

Tough new regulations on treating manure and reducing the environmental impact from farms have also pushed many small farmers out.

Most egg producers now have between 20,000 and 50,000 hens, said Yuan, a significant change even from two years ago. The remainder, with less than 10,000 birds, is likely to be shut down as soon as local governments begin favoring larger producers that can be more easily scrutinized.

High-tech hatchery

Those rapid changes are driving investments like the 150 million yuan ($22.60 million) hatchery in Handan, a city in North China's Hebei Province about 400 kilometers southwest of Beijing.

The highly automated plant, owned by a joint venture between China's Huayu Agricultural Science and Technology Co and EW Group's genetics business Hy-Line International, is the world's biggest hatchery of layer chicks, or birds raised to produce eggs rather than meat.

By producing 200,000 females a day, or around 60 million layers a year (one day a week is for cleaning), it can meet demand from larger farms who want to buy day-old-chicks in one batch, said Jonathan Cade, president of Hy-Line International, based in West Des Moines, Iowa.

"That's the best way to start off with good bio-security," he said. When the birds on one farm are the same age, they are less likely to spread disease.

Imported, latest-generation equipment helps speed up the throughput of the hatchery. An automatic grading machine, which can handle 60,000 eggs an hour, sorts eggs into two acceptable sizes before they enter incubators - uniform eggs produce similar-sized chicks that will have the same feeding ability.

Once hatched, female chicks go to automated beak-clipping machines that process around 3,500 an hour.

Only 20 staff will be needed in the new plant, compared with around 100 in Huayu's older hatchery, said Huayu chairman Wang Lianzeng.

Fierce competition, disease

Efficiency is important in an industry that is not expected to see much volume growth. The Chinese already eat more eggs per capita than almost everyone else given the huge population, about 280 a year or almost one billion a day across the country, so consumption is unlikely to rise much.

Breeders like Huayu are trying to grow by taking market share from others. In addition to the new Handan hatchery, it is building another in Southwest China's Chongqing, which will bring annual production to 180 million chicks.

Layer inventory in 2017 was around 1.2 billion, according to the China Animal Agriculture Association.

Huayu is also looking into breeding layers and building hatcheries in Southeast Asia and Africa, said Wang, the company's chairman.

The key to industrial scale facilities will be managing the risks of disease. Prices and demand for eggs and poultry plunged last year, after hundreds of people died from contracting bird flu, even though the disease left flocks largely unscathed.

Although that has created new opportunities for large players to expand after others were forced to exit, the impact of a disease outbreak on intensive operations is significantly higher.

Huayu itself has recently suffered from outbreaks, with high rates of poultry disease Mycoplasma synoviae (MS) in China's breeding flocks last year, said Wang. The disease can reduce egg production in layers.

Wang said biosecurity is the major advantage in the new hatchery, which uses advanced ventilation and environmental controls to keep new chicks healthy.

"When you enter the hatchery you wouldn't know you're in a hatchery," he said, referring to the smell typical in older facilities.

Disinfection is used at every step along the chain and workers follow strict procedures on hygiene, he added.

A safe environment with very high standards of biosecurity is important in raising chicks, said Wang.


Newspaper headline: China’s chicken challenge


Posted in: INSIGHT,BIZ FOCUS

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