China's Layer-Chicken Population to See Rapid Growth, Gro Data Shows

23 September 2019

African swine fever (ASF) is reshaping the livestock and poultry marketplace as it spreads largely unchecked across Asia. China, the center of the global hog market, has suffered the worst effects. After the Chinese Ministry of Agriculture and Rural Affairs estimated the country’s hog herd had dropped by a third, USDA PS&D projected an 8.1% increase in chicken production and a 2.1% increase in beef consumption.

But using data available from Gro, we find the USDA projections understate the expected growth in China’s non-hog animal populations. Our method, which we describe below, uses high-level feed-usage measures to predict how China’s loss of swine will result in greater numbers of chicken and beef cattle.

Layer chickens in China were the most numerous species prior to African swine fever, and their dominance is expected to widen as feed made available from hog loss promote growth for all non-hog animals. Click on the image to go to an interactive display on the Gro Intelligence web app.

The approach quantifies the effect of ASF on China’s non-hog livestock and poultry sectors by asking how many non-hog animals could be raised with the feed that will no longer be needed by the hog herd. For simplicity, our method assumes the availability of feed will remain the same.

According to China’s Ministry of Agriculture and Rural Affairs, 32% of the swine population was lost between July 2018 and July 2019, a period that starts before the first reported ASF outbreak. Using USDA Foreign Agricultural Service’s estimate of China’s hog herd of 428 million head in 2018, such a proportion equates to 138 million head lost if the annual declines through July prove representative of all of 2019.

To translate that number of head across all major species, we use a concept called grain-consuming animal units (GCAUs), representing a basket of grain feed types. GCAUs can be divided by species, or by particular types of a species. Here, we assume that the US and China have equal feeding intensities. This is a shaky assumption because, unlike in the US, about half of the hogs in China are raised in backyard farms, allowing them to be fed food scraps. Still, the calculation using GCAU provides a rough but useful technique for estimating ASF’s effect on the inventories of non-hog animals in China.

Chinese hogs account for the majority—56%—of GCAUs among major species, making an economically significant feed surplus available for the country’s non-swine population. Assuming that excess feed is distributed proportionately among China’s cattle, broiler chickens, layer chickens, and sheep, the population of non-hog animals will expand 41%. This calculation is based on animal populations for 2017, the latest year for which the United Nations’ Food and Agriculture Organization (FAO) has data.

As China increasingly industrializes its animal production, domestic consumption of corn and other feeds also have grown. Corn is the primary livestock and poultry feed among grains worldwide. Click on the image to go to an interactive display on the Gro Intelligence web app.

But what about predicting the gains to each species’ population? For that, a breakdown of animal population by species is needed. Using FAO’s annual stocks data, which are presented in the graphic above, layer chickens will see the highest number of new animals. That is no surprise given the animals’ relative mass per head. Additionally, in 2017, layer chickens accounted for 60% of the non-hog population among layers, broilers, cattle, and sheep as measured by number of head, and layers accounted for 86% of the non-hog herd within that same group in terms of GCAUs.

Using FAO’s 2017 estimate of 3.2 billion layers, African swine fever could bring about an additional 1.3 billion layers. Expectedly, the gains in cattle and sheep were far lighter in terms of number of animals. Cattle, which before ASF accounted for only 6% of non-hog animals in terms of GCAUs, are forecast to gain only 34 million head based on FAO’s 2017 estimate of an 83-million-head cattle herd.

This method of analysis combines different data sources to conclude that the gains to China’s poultry and cattle industries will be far greater than are currently forecast by USDA. The analysis suggests USDA estimates for chicken and beef consumption are too low for 2019, or that non-hog species’ population gains will sharply accelerate after 2019, or both.

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