China's feed industry witnessed the following significant features in 2012:
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- The industrial feed industry is in the process of rapid integration. The newly revised "Feed and Feed Additive Administration Regulations" was implemented in May 2012, which further raise the entry threshold for feed industry. Medium-and-large scale feed groups are expanding production capacities, and extending to upstream and downstream in the industry chain.
- The output of industrial feed increased rapidly, especially compound feed output improved significantly. The output of industrial feed in 2012 exceeded 200 million tons for the first time, up 12% year on year. Due to limited supply of good quality corn, and large fluctuations of raw materials price such as soy-meal and fishmeal, hog and poultry farms turned to use compound feed in 2012. The feature of compound feed instead of concentrate feed is more obvious in feed production and consumption structures.
- Due to energy feed supply shortage, the price soared. Owing to limited supply of high-quality corn, corn import volume topped 5 million tons in 2012. Many feed and farming enterprises change feed formula, and consumption of wheat for feed hit a record high.
- The degree of dependency on imported protein feed improves and the costs keep on increasing. A large fluctuation on soy meal price increases purchasing difficulties and operational risks for feed enterprises.
- The demand for major additives is on the increase, but the prices are on the decrease. With improvements of formula technology, and growth of industrial feed output, the demand for major additives is on the increase, such as Lysine and Methionine. However, an increase in production capacities brings more serious competition, and the overall prices of major additives in 2012 are lower than 2011.
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