Losses widen modern pastoralism suffers from high costs.

After being controlled by Mengniu, modern pastoralism still failed to stop losing money. On the evening of October 29, Hyundai Pastoral announced that its non-whon whon-owned subsidiary Hyundai Pastoral (Group) Co., Ltd. ("Modern Pastoral") had lost more than 700 million yuan in the first three quarters of this year. Since last year's first loss, the performance of modern pastoral industry has been depressed, when upstream raw milk sales face good opportunities, downstream business to Mengniu trading, modern pastoral performance does not seem to be difficult to revive. But months later, modern pastoral products are still not on the shelves, coupled with their own high-cost shortcomings began to be magnified, how to reduce costs has become a modern pastoral industry must pass a bump.
loss of 700 million yuan
According to a statement issued by Hyundai Pastoral, Hyundai Pastoral Group's revenue in the first three quarters of this year was 3.21 billion yuan, basically the same as the same period last year; Hyundai Pastoral said in a statement that the announcement was limited to the performance of Hyundai Pastoral Group and its subsidiaries and would not provide comprehensive information on the operations of Hyundai Pastoral and its subsidiaries.
loss of its subsidiaries is also a microcosm of modern pastoral performance. In 2015, Hyundai Pastoral's revenue and net profit both declined, with a loss of more than 700 million yuan in 2016 and a loss of 666 million yuan in the first half of 2017, compared with a loss of 565 million yuan in the same period last year.
after Mengniu's holding of modern animal husbandry, back to the tree does not seem to worry about "life". According to the announcement issued by Hyundai Pastoral, its subsidiaries will provide dairy products and services to Mengniu, and the proposed annual cap on dairy supply over the next three years will be RMB1,061 million, RMB1,899 million and RMB2.223 billion, respectively, for a total of about RMB5 billion. Mengniu 5 billion yuan order blood transfusion, in the original milk market downturn in the environment, whether the modern pastoral industry out of the loss of the status quo, much attention.
Some industry insiders pointed out that the performance of the subsidiary of Hyundai Pastoral, from the revenue is not difficult to see that the main revenue of Modern Pastoral from this company, and Hyundai Pastoral's official website also shows as "Modern Pastoral (Group) Co., Ltd.", therefore, from the company's performance is not difficult to see the decline in modern pastoral performance.
lost in
decline in modern pastoral performance, one of which was the cold sales of liquid milk products. In the first half of this year, sales of liquid milk in Modern Pastoral fell 38.17 percent to 405 million yuan from 655 million yuan a year earlier, according to the Modern Pastoral Bulletin. In the first half of 2017 and the first half of 2016, liquid milk product revenue accounted for 17.28% and 29.4% of consolidated turnover for the period, respectively. Hyundai Said total sales of liquid milk fell 43.47 per cent to 43,092 tonnes in the first half of this year from 76,229 tonnes in the first half of last year, as a result of the transition in business and branded milk markets.
for modern pastoral industry, the own brand is not only the position of digesting raw milk, but also to fill the gap in raw milk business revenue. After dabbling in downstream industries in 2013, its own brand has become a bright business segment for modern pastoral industry. In 2013 and 2014, Hyundai Pastoral's own-brand revenue was RMB321 million and RMB833 million, respectively, and the target set in 2015 was RMB1.2 billion, exceeding RMB1.502 billion, and the business revenue reached RMB1.48 billion in 2016. Beijing Business Daily reporter found that although sales have guaranteed revenue, but the growth rate has slowed sharply. In 2015, the year-on-year growth rate of Hyundai's own brand revenue fell to 80.31 percent from 160 percent in 2014, but declined by about 1 percent in 2016.
Previously, the Beijing Business Daily reported that modern animal husbandry lost terminal, its liquid milk products disappeared in the Beijing market, mengniu-related officials said that the current Mengniu and modern animal husbandry market transfer, products will be more professional, more dairy sales experience of Mengniu Beijing branch to take over, and carry out the late sale of modern animal husbandry products. Since it takes time for products to exit and re-enter, there is a short gap in the market and the market will soon return to normal.
as of October 30, Beijing Business Daily reporters visiting Carrefour, Jingkelong, Yonghui and other supermarkets found that modern pastoral products are still not on the shelves. A supermarket employee told the Beijing Business Daily, "Modern animal husbandry products after no, our supermarkets have been closed for a long time." Temperature products are clean, low-temperature products are expected to start after New Year's Day gradually clean up. The promoters of their family (modern pastoral) are gone and are now selling toothpaste."
, a senior dairy analyst at The People's Bank of China, said the main reason for the losses in modern livestock was the poor farming situation in recent years, with raw milk prices falling. Under these conditions, the cost of modern animal husbandry is high, so modern animal husbandry will lose money. In addition, the mid-range sales of modern pastoral products are weak, in the past two years, modern pastoral's own-brand products sold at a discount to digest raw milk, but in fact did not bring sales growth. Discounted sales have also made modern pastoral performance worse. The cost of raw milk in modern animal husbandry is higher, and the weak performance of the terminal is the reason for the loss. "Previously, Hyundai said to the capital markets that it wanted to drive growth through high growth downstream, but for now, sales have not met expectations."Cost difficulties
China's overall consumer demand contraction is the main reason for the poor sales of raw milk, coupled with foreign large packets of powder and raw milk imports impact on the corresponding market, the industry as a whole is weak. After March 2014, China's upstream raw milk farming industry began to shrink, there is a decline in milk prices, milk intake decline, refusal of milk and other phenomena;
industry insiders pointed out that due to the pasture cattle killing phenomenon and has not been stopped, resulting in a serious shortage of raw milk in china, raw milk prices are expected to rise in November-February this year. After the end of the global raw milk supply after the milk shortage in 2013, raw milk prices have entered the starting point of the three-year cycle, opening a new upward cycle. This is good news for modern pastoralism, but it is not clear whether it will be able to help it turn a profit.
the modern pastoral industry is how to solve the problem of high costs. According to the results of Hyundai Pastoral Group released this time, Hyundai Pastoral Group's operating costs rose to 2.3 billion yuan from 2.228 billion yuan a year earlier, and sales expenses rose from 240 million yuan to 250 million yuan. In its semi-annual report this year, Hyundai Said total raw material costs rose to 1,142 million yuan in the first half of this year from 980 million yuan a year earlier, an increase of 16.5 percent over the same period, as raw milk sales increased.
, an industry analyst who did not want to be named, said the Ministry of Environmental Protection had stepped up environmental requirements for agriculture and animal husbandry, allowing only fewer pastures and no more pastures in the future. In other words, it's going to be hard to build more pastures. Coupled with the increasingly stringent regulation of the environmental protection sector, the increasing cost of modern pastoralism in environmental protection, which is also worse for modern animal husbandry.
Said that if you want to break through, the future of modern pastoralism should try to control the scale, for different pastures to take different measures. Some ranches can take steps to break up and bring down the scale. The implementation of breeding integration, land transfer and other models, so that more land to grow feed, so that the cultivation industry and 10,000 pastures balance. Can also rely on downstream, promote the rapid development of low-temperature industry, refocus on products, the use of split pastures and other forms to promote the development of pasteur milk. It is hoped that modern animal husbandry can follow the law of industrial development and take a path of animal husbandry development based on breeding combination and moderate scale.
Beijing Business Journal reporter Qian Yu Prince Yang / Wen Baiyang / watchmaker.