Our country's population accounts for about 19.0% of the world's total population, and its pork consumption accounts for 49.6% of the world's pork consumption. Pork accounts for more than 60% of China's domestic meat production and consumption.
After all, a family of three eats almost one pig a year.
The status of pork in our country’s national dietary habits is evident.
Strong fluctuations in pork prices will also have a strong impact on the country's economy.
From the information received in the future, Wu Siyuan learned the reason why the price of pork has soared——
Swine fever!
African swine fever!
This is a virulent swine fever virus introduced from abroad.
[African swine fever] is an acute, febrile, highly contagious infectious disease of pigs caused by the African swine fever virus. The virus can be inactivated under the conditions of "60°C for 30 minutes", and the incidence rate is usually between 40% and 85%.
%, but the mortality rate after onset can reach 100%.
[African swine fever virus] generally invades pigs through the mouth and upper respiratory tract, or is bitten by a poisonous soft tick.
Pork, meat products in epidemic areas, and pork residues in international airports, seaports and other places may carry the virus.
The general incubation period is 5-15 days, but acute cases only take 3-4 days. Pigs infected with acute African swine fever generally die within 2-10 days.
These are all the messages Wu Siyuan received from the future.
Since the first [African swine fever] case in Shenyang in August 2018, as of January 14, 2019, domestic pig and wild boar epidemics have occurred in 24 provinces in China, and a total of 916,000 pigs have been culled.
The resulting decline in pig production capacity is immeasurable. The number of reproductive sows in March dropped by 21%, 8.696 million fewer than the same period last year, which is the largest decline in history.
The above-mentioned reduction in the production capacity of pigs and sows is already very huge. [African swine fever] has indeed caused a very huge negative impact. But the reality is probably even more severe and exaggerated than the reported data. p>
Whether they are pig farmers or large-scale breeding companies, [African swine fever] treats everyone equally, which has caused a sharp decline in the number of pigs sold and a sharp increase in social pig prices.
Although the country has released a lot of [pork reserves], hundreds of thousands of tons or millions of tons of pork are just a drop in the bucket for the annual consumption of more than 50 million tons of pork.
Pork prices eased slightly, but soon skyrocketed.
At that time, the whole society was talking about pigs, and many families chose not to eat pork or eat less pork.
…These messages received in the future flashed through Wu Siyuan’s mind.
Wu Siyuan tapped his fingers on the table. After learning about the pork crisis a year later, he felt what should be done!
He asked his assistant to bring him the relevant information on the pig business of [Chaoqun Group].
[Chaoqun Group] currently has a [Pig Farm] with an annual output of 100,000 pigs. Because they are fed special grass grown by [Lingquan Organic Liquid Fertilizer], the pigs raised are all high-quality pigs - [Sanweixiang]
Pig】.
If sold according to the current market conditions, these 100,000 [Three Flavored Pigs] can bring in revenue of 1.485 billion.
The cost of a pound of pork will not exceed 5 yuan, so the gross profit can reach 1.35 billion.
But this is fine pork.
High-end pork!
Different!
How can ordinary people be willing to eat pork at such a price!
Ordinary people still eat ordinary commercial pigs.
[Chaoqun Group] has plans to produce general commercial pigs and plans to build sixteen [pig farms] to achieve the annual slaughter target of 5.5 million pigs.
This plan has been progressing in an orderly manner, the contract has been signed, and the engineering team has been stationed for construction.
If this plan is realized, then [Chaoqun Group]'s pig business will usher in a climax, accounting for 0.77% of the country's pig breeding population with the size of a company.
Of course, this data is not comparable to those companies that have been working in this industry for many years.
For example, [Wen's Group], which started out raising chickens, sold 1.693 million commercial pigs in December 2016 alone, and the number of pigs sold in the whole year reached 17.1273 million.
However, [Wen’s Group]’s pork cost per pound is about 6 yuan, which is not as good as [Chaoqun Group].
[Chaoqun Group] Compared with them, in terms of the number of pigs raised, it is just a little brother.
But Wu Siyuan is self-aware.
It is easy to build a [pig farm], but if you want to run a [pig farm] healthily, many factors must be involved, and human factors account for a large proportion of them.
[Pig Farm] What you raise are pigs, but what you manage are people!
The relevant professional manpower required for sixteen [pig farms] is not a small amount.
So far, none of the sixteen [Pig Farms] has recruited enough personnel. The Human Resources Department of [Chaoqun Group] conducts social recruitment while at the same time conducting training with the old leading the new.
But as long as the sixteen [pig farms] are officially put into operation, the future fission will be simple, and the relevant personnel will not be as stretched as they are now.
Although it is not comparable to the number of animals raised by other breeding companies, for the current [Chaoqun Group], the target of 5.5 million animals per year is just right.
This was Wu Siyuan’s original idea.
But now that he knew about the [African swine fever epidemic] that would happen in the future, and the skyrocketing pork prices caused by the swine fever epidemic, ordinary people were reduced to the point where it was hard to find a pig. Wu Siyuan suddenly felt that the 5.5 million pigs sold annually
The goal is really too conservative.
He thought for a moment and then made a decision.
He called the group president Huang Yuping, Guan Xuelie, who was in charge of the agriculture and animal husbandry division, and related executives, and held a brief but important meeting in his chairman's office.
Wu Siyuan told them directly at the meeting, "I have been looking at the data on the domestic pig industry recently. Our original plan of 16 [pig farms] with an annual output of 5.5 million pigs is good, but I think there are still some problems."
Conservative."
"The domestic pig market is booming, and I think we need to be bold."
Wu Siyuan's speech came too suddenly, catching the executives present a little off guard.
After a while, the relevant student asked aloud, "Dr. Wu, do you mean to build a new [pig farm]?"
"That's right!" Wu Siyuan nodded.
Guan Xueliang frowned, and after pondering for a moment, he said, "Dr. Wu, tell me frankly that pig breeding has its own cycle."
"[Pig cycle] refers to the cyclical fluctuation pattern of pig prices. The principle is similar to the general spider web model. It is essentially an economic operation method in which profits adjust changes in supply and demand and are ultimately reflected in price fluctuations." p>
"The prerequisite for the [Pig Cycle] is a decentralized breeding environment, the motivation is driven by profits, the core is cyclical changes, and the performance situation is a cycle of mismatch between supply and demand."
"The cyclical trajectory of the [Pig Cycle] generally follows: falling pig prices - a large number of sows are culled - reduced pig supply - rising pig prices - rising sow stocks - increased pig supply - falling pig prices. This is the market
The speculative effect shown by the main body’s pursuit of breeding profits.”
"In layman's terms, when the price of meat is high, farmers are attracted and flock to it. The number of sows increases greatly, and the supply of live pigs increases, but this will lead to a drop in pig prices. When the price of meat drops, pig raising
If households exit the market and sows are culled in large numbers, the supply of live pigs will decrease and meat prices will rise, starting a new cycle."
"It can be said that the pig farming industry makes profits every year, is flat every year, and loses money every year!"
"Dr. Wu, we can now be said to be in the third [pig cycle]. Since 2014, our country has begun to implement strict environmental protection regulations and has made efforts to increase the scale of the pig breeding industry, resulting in a large number of free-range pig breeding.
Households have withdrawn from the market, and the number of live pigs and reproductive sows has begun to enter a sustained downward path."
"After bottoming out in May 2014, the price of live pigs continued to rise all the way to June 2016. The swine erysipelas epidemic that broke out in the first half of 2015 contributed to the situation. By June 2016, the price of pork had reached the level of
The historically sky-high price of 21.2 yuan/kg has increased by an astonishing 103% from its lowest point."
“This is an up year in the [hog cycle].”
"But things must go to extremes. The price of pork has stimulated the impulse of related breeding companies to replenish their flocks, and especially the efficiency improvement of large factories. I have observed that for companies like [Wen's Group], on the one hand, the weight of pigs sold for slaughter has increased significantly.
While the stock has remained unchanged or even declined, total pork output has actually increased; on the other hand, the efficiency of sows has improved. Although the stock of reproductive sows has decreased, the stock of live pigs has not declined significantly, and has even increased in some periods. The total number of live pigs has increased.
Slaughter volume has not been significantly affected."
"This will inevitably lead to a downward trend in pork prices in the next one or two years."
"Although our company's breeding costs are lower than other breeding companies, the depreciation costs caused by a large number of equipment and buildings, the labor costs of breeding and other costs are also exaggerated. In addition, the large number of pigs sold by our group will also lead to
If the price of pigs falls further, in the downward cycle of pig prices, it is very likely to bring losses to our group. As the saying goes, the more you raise, the more you will lose." Guan Xueliang was very concerned at first glance, and various related information
He opened his mouth and spoke to Wu Siyuan conclusively.
"Mr. Guan, you are right! If we invest a lot of money in the pig breeding industry to expand now, it will be expansion against the trend and violates the development law of the pig cycle."
"But let me tell you a story."
"South Korea's DRAM business, like my country's pig breeding, also has a so-called cycle. In the 1980s, the DRAM market was not in good shape. By the end of 1986, Samsung Semiconductor's cumulative losses had reached US$300 million."
"In this case, the normal idea of a company is to cut back on food and clothing, and related companies in other countries do the same. Many companies in the United States and Japan have reduced production capacity or withdraw from the market, but South Korea's Samsung does not do this. It relies on government support.
Make countercyclical investments.”
"You have also seen the final result. South Korea's DRAM business ranks first in the world. It can be said that if South Korea's Samsung's semiconductor business trembles, the whole world will tremble."
"Of course, South Korea's Samsung's technology accumulation in the DRAM business also plays a big role."
"The truth is actually the same. Although we don't have relevant support from the government, the [Audition] project has brought us a steady stream of profits. Relying on these profits, we can also develop counter-cyclically, strike later and seize opportunities." Wu Siyuan has said so. What else can other senior executives, including Guan Xueliang, say?
Moreover, since Wu Siyuan founded the company, he has not made a single mistake in any major strategic decision.
He has sufficient authority in the company.
The reason why Guan Xueliang stood up and said so many words was simply to stand in his position and state his interests to Wu Siyuan. As for the final decision, it was still up to Wu Siyuan to make the final decision.
After Guan Xueliang pondered for a while, he began to get into the mood and think about expanding investment in pig breeding. He asked Wu Siyuan, "Director Wu, to what extent do you think we should increase the annual slaughter quantity?"
Wu Siyuan had already had an idea in mind. He originally wanted to say 100 million heads, but this was unscientific. Even if Wu Siyuan used his golden finger, it would be difficult to do it. The current national output per year is only about 700 million heads.
Not to mention 100 million head, even if we cut it in half and produce 50 million head per year, it would be difficult for [Chaoqun Group] to achieve it.
So Wu Siyuan could only settle for the next best thing and said, "Thirty million to fifty million heads! No cap!"
The executives present were all shocked. This is no longer a question of money. The manpower and material resources involved are a huge system project that cannot be solved simply with money.
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You know, [Chaoqun Group] has set such a high goal, but the current [pig farm] has an annual slaughter capacity of only 100,000 pigs.
The [Pig Farm] that was built before, the fastest one, took a month to start breeding.
Guan Xuelie swallowed his saliva and said to Wu Siyuan, "Director Wu, this goal is too high, can you do it step by step? It is planned to take 2 to 3 years, and I guarantee you that it will be completed with quality and quantity.
."
Wu Siyuan also wants to give Guan Xue some time, but the future [African Swine Fever] will not give Wu Siyuan time.
In more than a year, [African swine fever] will strike with force.
Before that, the annual slaughter volume of [Chaoqun Group]'s pig business must reach the level that Wu Siyuan wants, in order to relieve the country's worries and gain enough influence in this epidemic. Of course, [Chaoqun Group] has obtained
Excess profits are additional.
Wu Siyuan has not considered intercepting the upcoming [African swine fever epidemic] from its source.
But he thought about it later and still felt it was impossible. As long as there is a shortage of domestic pork, the country will continue to import pork from abroad.
Even if the country does not import, but there is a price difference between international and domestic raw pork, domestic smugglers will not miss this opportunity to make a fortune.
During smuggling, [African swine fever virus] will visit the country and spread unceremoniously.
That is impossible to guard against.
Wu Siyuan sighed secretly, and then said firmly to Guan Xueliang, "Mr. Guan, this is not a discussion, this is a task!"
Guan Xueliang is the veteran of the company, and he has feelings for the company. After hearing Wu Siyuan's tough words, he still did not back down, but continued to persuade Wu Siyuan.
If it were Su Shixian, he would never do this.
From this aspect, their personalities are very different.
Guan Xuelie was still very worried and said, "Dr. Wu, I hope you will think carefully about it. It is too risky to increase the annual slaughter volume to such a high target all at once. Whether it is externally or internally, if there is an emergency,
If something happens, the loss will not be something that can be solved by hundreds of millions, but billions or tens of billions of dollars!"