Livestock farming is an important industry related to the national economy and people's livelihood, and its development is crucial to residents' "meat plates" and "milk cans". Since the reform and opening up, China's livestock production capacity has steadily increased, and the industry scale has continuously expanded, gradually growing from a sideline of households to a pillar industry of agricultural and rural economies.

However, it is also necessary to be clear-eyed about the challenges that the livestock industry has faced in recent years, and achieving high-quality development still requires overcoming difficulties.

The contradiction between supply and demand has intensified.

In the first half of this year, except for the significant improvement in the pig market, other livestock product markets remained sluggish.

According to data from the Ministry of Agriculture and Rural Affairs, under the joint action of market regulation and capacity control, pig prices rebounded, and the pig farming industry returned to a normal profit state. The market prices of chicken and eggs slightly declined, but the impact was relatively small. The market prices of other livestock products were not optimistic. For example, the wholesale price of mutton in July has dropped to 59.02 yuan/kg, a year-on-year decrease of 7.58%, with a cumulative decline of nearly 27%. The market prices of beef and dairy cattle also declined significantly, with the prices of beef and fresh milk in the first half of the year decreasing by 12.1% and 12.5%, respectively; as of the third week of August, the national average price of beef was 68.43 yuan/kg, a year-on-year decrease of 16.5%. Some farmers are in a dilemma of "losing money by selling and losing more by not selling."

The main reason for this situation is the increase in supply combined with weak demand, leading to a temporary imbalance in the supply-demand relationship. In 2023, China's import volume of livestock products was 128.22 million tons, with an import value of 45.19 billion US dollars, of which meat and meat products accounted for more than half. In contrast, exports showed a slow growth trend with occasional declines. With domestic prices significantly higher than international market prices, the increase in imported meat directly affected the domestic market's price system.

Taking the beef industry as an example, in 2023, China's total beef production was 7.53 million tons, plus more than 2.7 million tons imported, with a total exceeding 10 million tons. In addition, as bilateral and multilateral free trade cooperation continues to strengthen, some trade policies have gradually relaxed. For instance, in 2024, Argentina fully lifted restrictions on beef exports, leading to a surge in shipments to China, which increased the port arrival volume of beef by 22% in May compared to the previous period. This resulted in a situation of relative oversupply against a backdrop of weak demand.

According to the "China Agricultural Industry Development Report 2024", after per capita GDP exceeds 10,000 US dollars, the growth of meat consumption slows down and tends to stabilize. When it further breaks through 20,000 US dollars, the per capita consumption of meat and fatty foods in the food consumption structure actually decreases. Data shows that in 2023, China's per capita GDP was 12,600 US dollars, indicating that residents' future meat consumption is unlikely to grow significantly, and solving the oversupply from the demand side has limited effects.

It is urgent to reduce costs and increase efficiency.

The quality and competitiveness of the livestock industry depend not only on supply assurance but also on industry quality and risk resistance. Supply assurance is the foundation of livestock industry development, while industry quality and risk resistance are the keys to the sustainable and healthy development of the livestock industry.China's livestock production costs are higher than those of other major producing countries. Among the top 10 global livestock producing nations, China's pork industry ranks 8th in terms of output per unit, with production technology levels at only 61% of Germany's, below the global average. Although the beef and mutton industries rank 3rd and 2nd respectively, there is still a 20% to 25% gap in production technology compared to leading countries, and production efficiency needs to be improved.

The low feed conversion rate leads to a lack of cost advantage in China's livestock production. Currently, the feed conversion rate for ruminants in China is more than 10 percentage points lower than that of developed countries. The "domestic corn - soybean meal type single feed" structure of feed formulation can no longer meet current nutritional needs and is costly. Therefore, technological progress has become the main factor in reducing costs and increasing efficiency in the livestock industry.

Strengthen brand building

Promoting high-quality development of the livestock industry also faces challenges in terms of quality and safety.

With the improvement of living standards, consumers have higher requirements for the taste and nutritional value of livestock products, and they also have more expectations for green organic livestock products. However, there is still a significant room for improvement in the livestock industry in terms of quality supervision, brand building, and other institutional innovations to adapt to market demands.

On one hand, the traditional small-scale family farming model is widespread, and there are still issues with management, disease prevention and control, and feed use that are not scientific enough, affecting the safety and quality of livestock products. An important reason for the low selling price of livestock products is that small farmers producing single, homogeneous products do not have a fixed sales channel and have no bargaining power in the face of excessive price pressure. Compared with fresh meat and frozen meat after simple slaughtering, the price fluctuations of higher-grade and better-quality meat products after processing and packaging are not significant.

On the other hand, due to insufficient research on the basic theories and methods of brand building, especially misconceptions about the main body of the brand, cultivation path, and interest linkage mode, the effectiveness of livestock brand building in some places is not obvious. Some regional enterprises are unwilling to use regional public brands, which restricts the sustainable development of livestock brands. At the same time, the quality issues of livestock brand products are worth paying attention to. According to the consumption evaluation data of agricultural products from the National Agricultural Market Research Center of China Agricultural University, the negative review rate of regional brands of poultry and livestock on major e-commerce platforms is high, mainly focusing on issues such as unfresh products, poor taste, non-standard cutting, and unstable quality.

Enhance competitiveness

Due to the large amount of resource consumption and environmental emissions required for livestock production, the pressure on livestock breeding to get out of difficulties is still very large, and the improvement of its productivity will face many challenges. Especially for countries like China with scarce water and soil resources, the enhancement of livestock competitiveness must be based on improving production efficiency, solving deep-seated industry problems, and grasping the two important focuses of "increasing technology" and "strengthening the industry chain", and implementing comprehensive policies and efforts.

Increase investment in science and technology to enhance the competitiveness of the livestock industry. First, strengthen breeding research to reduce the dependence on foreign animal breeds and forage, develop characteristic species breeding, promote excellent breeds suitable for local climate and environment, and improve the quality and output of livestock products. At the same time, improve the ability of scientific and technological innovation and application promotion, reduce production costs through optimizing breeding technology, improving feed conversion rate, and enhancing epidemic prevention level. Driven by scientific and technological innovation, mechanism innovation, and policy innovation, promote the integration of mechanical equipment and breeding technology, the integration of livestock breeding mechanization and informatization, and the adaptation of facility equipment configuration and farm construction, focusing on filling gaps, strengthening weak links, and improving single output.Strengthen the collaborative development of the entire livestock industry chain to ensure benefits for all parties and continuously enhance the ability to withstand risks. Lead with leading enterprises to enable dispersed farmers to join forces and promote the expansion of the industry chain, thereby increasing market benefits. Encourage large enterprises to leverage their advantages in breeding technology, breeding techniques, feed formulation, and facilities to implement a comprehensive business model from breeding to slaughtering, processing, distribution, and finally to sales. The government should increase policy support for the development of enterprises' unique, green, and organic livestock products, encouraging product innovation and brand building. At the same time, utilize the government's reserve purchase link to buffer the impact of oversupply and mitigate the market effects caused by price fluctuations.