Chinese demand for New Zealand dairy heifers falls

Chinese demand for dairy heifers is falling, with prices dropping by 30 per cent.
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At its peak a year ago exporters were sending 64,728 heifers and other breeding cattle to China for a return of $147 million.
This year exports are a trickle of only 6650 animals, worth $10.9m.
A spokesman for Carrfields, which exports breeding cattle to China, confirmed that both the volume had fallen, as well as the price.
That was backed up by another exporter, PGG Wrightson, which described it as a significant decline.
A Rabobank report said the growth in Chinese dairy farming has fallen away because of reduced profits.
China was also producing its own dairy heifers, lessening the need for imports.
Rabobank analyst Michael Harvey said last year New Zealand’s exports of dairy heifers had hit near record levels. Virtually all of them were sent to China.
He said China had been the engine room of growth for the dairy heifer trade because of its appetite for dairy products and aspirations to lift its local milk supply.
«Since the 2008 food safety crisis in China (where melamine contamination was found in infant formula, other dairy and food stuffs), there has been a marked shift to large-scale dairy operations in China, which has been supported by government assistance and tax incentives,» Harvey said.
But lower milk prices, high costs and the difficulty of raising funds for new developments had led to a slowdown.
«Reduced profitability has seen some new large-scale farm developments being postponed or cancelled, which has led to the backlog of dairy heifers in global supply chains,» Harvey said.
Waikato farmer Wayne Derrick, who raises dairy heifers for export, said he had not noticed any fall off in demand yet from his exporter.
«We get them at between four and 21 days, and we rear them up to 95 kilograms and then they go. It hasn’t affected us, but we haven’t got a contract yet for next season,» Derrick said.
PGG Wrightson general manager livestock Peter Moore said his company had not sent any livestock to China for about 12 months. It was not a big part of its business, so would not have a large impact.
He said the decline was a «blip».
«We have seen it before, it will come right. There has been consolidation in the industry in China. We are seeing some more enquiry now.»
Harvey said that while China would remain the cornerstone of trade, demand was likely to be at a lower rate than in recent years.
«In the Chinese government’s five-year plan, there are calls for transformation in the country’s growth model by… stepping up agricultural modernisation, so we would expect to continue to see small farmers exit the industry in place of larger operators.»
New Zealand was well positioned to trade heifers with south-east Asia, although trade with Indonesia, Sri Lanka, Pakistan, Malaysia and Vietnam might require adjustments to breeding and sourcing strategies, sustainability and animal welfare.



Mirá También

Así lo expresó Domingo Possetto, secretario de la seccional Rafaela, quien además, afirmó que a los productores «habitualmente los ignoran los gobiernos». Además, reconoció la labor de los empresarios de las firmas locales y aseguró que están «esperanzados» con la negociación entre SanCor y Adecoagro.

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