For the Chinese, the rooster symbolizes vitality, honesty, integrity and luck, but what meaning does the Chinese poultry industry have to the world?

“China is different and is not for the faint-hearted,” said Dr. Mark Lyons, executive vice president and head of Greater China for Alltech, during the Alltech Annual Breakfast Meeting at the 2017 International Production & Processing Expo.

There has been a great urban shift of 300 million people within the economic power player, resulting in 188 cities in China that are larger than Chicago. Additionally, China has a rising middle class that is young, urban and globally minded.

Since the annual Alltech Global Feed Survey began in 2011, China has dominated the world’s feed production, responsible for approximately 35 percent of the world’s total animal feed. In terms of poultry specifically, China is home to 20 percent of the world’s 60 billion poultry birds, including 8.8 billion broilers, 1.2 billion layers/breeders and 4 billion waterfowl. Currently, China produces 26 percent of the world’s poultry meat, and studies show that both consumption and production of poultry will continue to increase in China, and worldwide, over the next 10 years. China is also the world leader in egg production, producing almost six times more than the United States, which is in second place.  

Poultry trends in China

• Both the poultry and egg industry are moving toward integration.
• Consumer awareness of environmental pollution is growing and creating pressure at the farm level.
• Antibiotic-free production is a growing trend as testing and legislation increase.
• Pressure from the cost of feed materials is rising.
• Desire for high-quality poultry products is increasing.

Challenges within China’s poultry sector

• High feed costs; up to two times the cost of international prices
• Flat consumption, as chicken meat is considered an inferior protein to pork, seafood and beef
• Falling exports, as China’s competitiveness is decreasing against Brazil and Thailand to its top export market, Japan 
• Disease, with avian influenza outbreaks harming the image of poultry meat with consumers

“We have been talking about the power of the new consumer, which we are calling the prosumer,” said Lyons. “I believe there are more prosumers in China than any other market in the world today.”

Rather than simply consuming products, these prosumers are proactively exhibiting their beliefs, ethics, standards and aspirations through their purchases. Prosumers are product and brand advocates who now significantly affect the success or failure of companies, products and brands through their involvement on social media outlets. Poultry farmers around the world need to build relationships with these new consumers, and, as a poultry powerhouse with the largest rising class of prosumers, China may lead the way.

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[ATLANTA] – Dr. Mark Lyons, global vice president and head of Greater China for Alltech, presented “Understanding China: How the second-largest poultry market is changing the world,” addressing the Alltech ACE principle of developing solutions that are safe for the Animal, Consumer and Environment, to an audience of 250 people during the Alltech Annual Breakfast Meeting at the International Production & Processing Expo.

There has been a great urban shift of 300 million people within the economic power player, resulting in 188 cities in China larger than Chicago. Additionally, China has a rising middle class that is young, urban and globally minded.

“China is different and is not for the faint-hearted,” said Lyons. “They rapidly change and want transparency, and if you’re going to do business in China, then you need to be there, and you need to commit to being Chinese.”

China is going through a period of transition in many areas, including agriculture. Its industry has been very fragmented, but it is evolving toward more integration and segmentation. Results from the 2017 Alltech Global Feed Survey showed that China continues to be the largest feed-producing country but is producing that feed with fewer and fewer mills. The consolidation has been vast, with a report this year of a nearly 30 percent decline in the country’s number of feed mills.

China is home to 20 percent of the world’s 60 billion poultry birds, including 8.8 billion broilers, 1.2 billion layers/breeders and 4 billion waterfowl. Currently, China produces 26 percent of the world’s poultry meat, and studies show that both consumption and production of poultry will continue to increase in China, and worldwide, over the next 10 years. China is also the world leader in egg production, producing almost six times more than the United States, which is in second place.

Trends in China

• Poultry and egg industry moving toward integration
• Consumer awareness of environmental pollution growing and creating pressure at the farm level
• Antibiotic-free is a growing trend as testing and legislation increase
• Pressure from the cost of feed materials
• Desire for high-quality poultry products

Challenges

• High feed costs; up to two times the cost of international prices
• Flat consumption, as chicken meat is considered an inferior protein to pork, seafood and beef
• Falling exports, as China’s competitiveness is decreasing against Brazil and Thailand to its top export market, Japan
• Disease challenges, with avian influenza outbreaks as a constant reminder to consumers, which harms the image of poultry meat

“We have been talking about the power of the new consumer, which we are calling the prosumer,” said Lyons. “I believe there are more prosumers in China than any other market in the world today.”

Rather than simply consuming products, these prosumers are proactively exhibiting their beliefs, ethics, standards and aspirations through their purchases. Prosumers are product and brand advocates who now significantly affect the success or failure of companies, products and brands through their involvement on social media outlets, and food producers and farmers need to pay attention to their demands.

As consumer awareness of environmental pollution has grown, it has created pressure at the farm level. The Chinese government has put a focus on livestock pollution control regulations, new environmental laws, animal husbandry laws, standardized scale farming, water regulations and animal disease control laws.

Alltech China is hosting an environmental meeting from March 7–9. The event will focus on overcoming environmental challenges and finding opportunities in the new green economy. For more information or to attend the meeting, contact Apple Zhang, marketing manager for Alltech China (azhang@alltech.com).

Agriculture is not immune to the changes of the digital age. Technological innovations have the ability to transform every link in the food chain, from seed to fork.

The need to embrace the opportunities these innovations offer is real. In order to feed the nearly 10 billion people with whom we will be sharing this planet by 2050, crop and livestock productivity improvements are essential.

Agricultural efficiency is still relatively poor: 7 tons of feed are needed to produce just 1 ton of meat. It takes 880 gallons of water to produce one gallon of milk.

Further, climate change is already requiring changes to crop management, and access to fresh water and good soil are becoming serious limitations for agriculture.

Finally, there are competing food requirements. In wealthier areas, food is a relatively small part of the household budget, and consumers are becoming prosumers, with high expectations for the standard and types of food they want. At the same time, global hunger and food scarcity are serious challenges - nearly 800 million people are undernourished. Connecting both is the global food chain: ensuring that there is transparency, traceability and trust between producers, processors and prosumers.

Digital disruption drives the next agricultural revolution

Fortunately, the makings of a fifth agricultural revolution are here, with the potential to reduce or eliminate all of these issues.

Eight emerging digital technologies each have the potential to transform agriculture. They range from specific technical tools to new ways of seeing the existing system. Some, especially the first ones, sound familiar but their use in agriculture is novel.

These eight digital technologies can be categorized into four each of hardware and software and, when combined with the IoT (Internet of Things), can profoundly change the way food production works.

To discover Aidan Connolly’s list of the eight digital technologies disrupting agriculture, view his original post on LinkedIn.

Fifty-three percent of consumers frequently wonder if the food they buy is safe, according to research conducted for the U.S. Farmers & Ranchers Alliance.

Food safety has become a top priority among poultry producers today because of its direct and significant effect on brand reputation. The effects of a food recall are always costly and can severely harm a brand's reputation if consumers lose trust.

For over two decades, the meat and poultry industries have been following the guidelines of Hazard Analysis Critical Control Point, or HACCP, a management system for food safety put in place to address potential biological, chemical and physical contamination. This allows producers to identify possible hazards in order to take the necessary actions to reduce or eliminate the risk.

There is no silver bullet strategy that has the capability to address every potential threat along the production chain, so producers and plants use a variety of strategies at their critical control points.

Three steps to improve food safety

As stated on the National Chicken Council website, some ways that producers can improve their food safety include:

• The use of feed additives that can reduce the growth of potential microbial hazards.
• Approved rinses to kill any surviving bacteria.
• Metal detectors to make sure physical contaminants are not found in a product.

In addition to food safety systems, producers also need to make sure that their consumers understand proper food handling practices. Consumers should be made aware of the proper way to clean, prepare, cook and chill raw agricultural products in order to further reduce the risk of food-borne illnesses.

West Liberty Foods, a leading supplier of sliced meats in the U.S., understands that the concepts of food safety and consumer trust are crucial to success. The company’s chairman, Paul Hill, explained its strategy in a recent Alltech feature story. Learn more about how a brand like West Liberty Foods approaches food safety by clicking on the link below.

http://stories.alltech.com/west-liberty-foods-our-brand-is-food-safety.html

The following is an excerpt from a post by Chief Innovation Officer Aidan Connolly on LinkedIn.

If you have read any of Alltech’s other blog posts on mycotoxins, you know the many hazardous effects mycotoxins may have on livestock animals. In poultry production alone, mycotoxins have been linked to mouth lesions, yellow livers, gizzard erosions and poor gut integrity. Many of the world’s biggest poultry integrators pay very close attention to their grain and feed quality because of the effects these challenges may have on poultry health and on profit margins.

When it comes to organic poultry production, however, the more stringent regulations also present unique challenges.

First, there is the challenge of supply and demand. According to a survey conducted in 2014 by the USDA National Agricultural Statistics Service, sales of U.S. organic products have increased 72 percent since 2008. Demand for organic and non-GMO broiler chickens, turkeys and eggs is also strong and is expected to double in the next decade. In response to the increase in demand, local producers have been expanding their organic and non-GMO production. A 2016 article from WattAgNet.com summarizes the rapid growth that organic poultry has had. From 2000 to 2014, organic broiler production grew by 96 percent, organic layer flocks grew by 89 percent and turkey production grew by 35 percent.

Even though the poultry industry has been very quick to respond to consumer demands, the supply of certified organic and non-GMO grains has been slower to react.

The U.S. is the largest corn producer in the world, but in 2011 it was estimated that organic corn represented only 0.26 percent of production. Today, about 4 percent of food sales are organic while only 0.5 percent of U.S. farm acreage is dedicated organic. With a limited supply, buyers are often forced to accept higher levels of broken kernels and imperfections in their grain.

The case for grain quality

Grains with broken kernels and imperfections usually contain higher levels of molds and mycotoxins. Most of the mycotoxin-producing species of molds are soil-born fungi, which can survive and remain in fields for long periods of time. With modern agricultural practices such as no-till methods, incidences of fungal contamination appear to be increasing. The presence of corn stems and infected ears remaining on the soil surface from one year to another may serve as a source of inoculums, contributing to the increased incidence of contaminated grains (Mora and Moreno, 1984).

According to Duarte et al. (2008), fungicides can reduce the incidence of Fusarium molds in corn grain, but the use of fungicides is not allowed when growing organic corn. 

Managing a hidden mycotoxin threat

To protect our food chain, the U.S. Food and Drug Administration imposes limits for mycotoxin levels in food and feed. This was highlighted in a 2016 alert by the National Grain and Feed Association to remind everyone of the acceptable levels. To meet the standards of organic production as well as these limits, organic producers are limited in terms of mycotoxin risk management and gut health prevention tools.

Management strategies and the implementation of a thorough program are necessary to prevent exposure to mycotoxins. Checking grain quality by utilizing industry-approved standards to collect samples and submitting them to a high-standard testing laboratory is a good start, followed by routine maintenance of feed mills to eliminate possible contamination in the milling process. Certified organic mycotoxin control agents in the diets should also be utilized to help prevent or offset the impacts mycotoxins can have on overall performance.

To learn more about Alltech’s program for managing mycotoxins, visit www.knowmycotoxins.com.

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In the United States and Canada, the poultry industry’s standard performance measurement is the feed conversion ratio (FCR). Calculating FCR is as simple as taking the total amount of feed consumed by the flock and dividing it by the amount of weight gained or the number of eggs produced. In other words, FCR equals input divided by output. For broiler producers, an FCR of 1.6 means that their chickens gain 1 kilogram of weight for every 1.6 kilograms of feed consumed. The lower the FCR, the more efficient animals are at converting feed into food.

Since the 1980s, poultry producers have been able to reduce their feed conversion ratios from producing a bird weighing 2 kilograms in 70 days with an FCR of 2.5 to a bird weighing the same in 29 days with an FCR of 1.5 today. This means that fewer grains are being used to produce more meat and eggs. The industry made this leap using two key strategies: genetic improvements and the inclusion of exogenous enzymes.

Exogenous enzymes allow producers to get more energy, phosphorus and amino acids from their diets, and the international unit for measuring enzyme activity is the katal. The katal represents 1 mol of substrate per second; however, the most valued unit for comparative purposes in the animal industry is the amount of the enzyme in milligrams needed to catalyze the reaction of a particular substrate, releasing 1 micromol of a final product in one minute.

It is far more difficult for producers to determine the effect a particular enzyme will have on their flock’s efficiency. Most producers will need to run field trials in order to see how the inclusion of a particular enzyme will impact their FCR. These trials can be complicated, due to the number of variables involved, and they can be very expensive, too. Being able to measure how effective a particular diet is at providing nutrients for digestion before it is fed to the animals can give a great advantage to poultry producers.

Tools like Alltech True Check™ in vitro screening can allow producers to do just that. True Check simulates poultry digestion in the lab utilizing samples of feed. This tool mimics the real life conditions of the animal’s digestive system and shows producers the amount of nutrients that are being released for digestion. With True Check, producers can do side-by-side comparisons of multiple feeding strategies and choose the one that will minimize their FCR and improve their flock’s performance the most.   

Measuring and projecting performance allows poultry producers to choose the feeding strategy that reduces their feed costs and, as a result, gives them the best chances for increasing profitability. After all, the industry can only improve what it can measure.

Have a question or comment?

The following is a preview of Aidan Connolly's post, which you can find on LinkedIn. 

Question 1: Why are antibiotics in animal feed in the first place?

Antibiotics have been good for the world. They have been instrumental in allowing humanity to enjoy a standard and quality of life unimagined prior to their discovery. Initially, antibiotics allowed us to control life-altering and fatal diseases in humans.

Secondarily, they have facilitated the development of a modern, safe and efficient agricultural system that produces food economically, affordably and plentifully for most of the 7 billion people on the planet. 

When farmers began putting antibiotics in the feed of animals in the 1950s they did so initially because it resulted in lower mortalities but quickly they also noted their animals grew faster, requiring less feed. Veterinarians later observed better intestinal health and less inflammation during autopsies and surmised that the improved animal performance was most likely due to the more efficient absorption of nutrients in the intestine of those animals.

Question 2: Where does resistance come from?

The simple definition of resistance is “the ability of microbes to resist the effect of antibiotic drugs” and the mechanisms by which bacteria become resistant and pass on that resistance to other bacteria are relatively well known. Bacteria adapt very quickly to the environment, so when antibiotics are used continuously, the bacteria they are meant to kill can adapt, survive and replicate making it extremely difficult to kill the remaining bacteria. Resistance can develop through selective pressure (that is, when antibiotics kill some but not all of a bacterial group), mutation and gene transfer. These three mechanisms can also combine, as when bacteria not only become resistant to antibiotics, but also start to pass that characteristic on to other bacteria present in the gut. 

There are many sources of resistance with examples in humans and animals, including the inappropriate use of drugs or inadequate diagnostics in hospitals or veterinarian situations, the use of antimicrobial soap in bathrooms, the use of zinc oxide or copper sulfate in the diets of animals, and the use of chlorine in water of humans and animals alike. Scientists have demonstrated that these and any substances that create pressure on a microbial population lead to changes similar to the passage of resistance. 

Overall, humans are the main source of resistance, due to the misuse of antibiotics, not using them for the time period recommended by their doctors, or not using the recommended dose. Hospitals and homes for the elderly have become hot spots of resistance, which puts older people, very young people and immune-comprised people who are the least capable of fighting off infection without antibiotics at the highest risk.

It is clear that antibiotic use in humans is not uniform. For example, looking at a map of the U.S., antibiotic misuse per 1000 people tends to be concentrated in the eastern part of the country rather than the west, with over-prescription particularly prevalent in the South and Midwest. Recent studies indicate that an average of 506 antibiotic prescriptions are administered per 1000 doctor visits, while experts concluded that only slightly more than half of these prescriptions were actually necessary or appropriate.

In animals, resistance works the same way, and the passage of resistance from animals to humans can occur through contact with live animals or environmental contamination. (In 2005, the CDDEP found that when antibiotics are fed to animals 90% go through urine and 75% were found in feces; more recently antibiotic resistant bacteria have been found in water systems, waste treatment and in dust carried by air.) It also seems to be possible for resistance to be passed through the consumption of meat, milk and eggs from contaminated animals (for example, a U.S. study found that 53% of grocery chicken contained antibiotic resistant E. coli). 

Farmers are often irritated that activists focus on antibiotics in animal food, when the majority of resistance come from human misuse/overuse/abuse, but the general public finds it easy to agree with Prince Charles (speaking to the Royal Society in London) when he said, “I find it difficult to understand how we can continue to allow most of the antibiotics used in farming, many of which are also used in human medicine, to be administered to healthy animals.”

Read the rest of Aidan Connolly's post, including the next five questions and answers, here.