Mengniu kicked out the supplier Ketuo Biotech, and China's dairy industry was "stuck in the neck" difficult to solve

Author/Qingfu

Editor/Jia Jia

Source/Treasury Finance

Recently, Treasury Finance learned that due to the expiration of the three-year cooperation period, Mengniu will not renew the cooperation with the domestic probiotic company Ketuo Biotechnology. "Mengniu's order volume accounts for more than 70% of the share of Ketuo's compound thickener products," a post-investment manager of a venture capital institution told Treasury Finance, which means that Ketuo Biotech will lose its largest customer, Mengniu.

The domestic head probiotic companies were kicked out of the supplier ranks by the domestic head dairy group, which also revealed the problems in China's dairy industry chain: in key industrial links such as probiotics, forage, and breeding cattle, whether it is a dairy giant such as Mengniu and Yili, or an upstream supplier such as Ketuo Biology, they are not ready for "domestic replacement", and the underlying key technology of China's dairy industry is still "stuck" by foreign countries.

[1] Breaking the "stuck neck", the dairy giants are making great noise

In all the statements of China's dairy industry, the importance of probiotics to the dairy industry is equivalent to the importance of engines to airplanes, chips to mobile phones, and seeds to agriculture - without self-developed probiotic strains, it will not be able to provide more nutritious dairy products for the Chinese people, and China's dairy industry chain will be "stuck" by foreign countries.

"Once probiotics are banned from being exported to China, we can't even produce a cup of yogurt," said the post-investment manager, adding that probiotics are widely used in yogurt, infant formula, beverages and other categories, "The domestic market demand is huge, but our foundation is unstable, and the core technology is not in our hands." ”

Especially after the concepts of "big food" and "national food security" were proposed, Chinese dairy companies announced to increase probiotic research in the consideration of supply chain security and cost reduction.

(Source: Internet)

From media reports and publicity of major dairy companies, it is not difficult to see that China's dairy industry has made breakthroughs in strain screening and cultivation, breaking the problem of "stuck neck" in foreign technology:

Mengniu has cultivated PC-01, a Chinese patented probiotic with independent intellectual property rights, which is not inferior to or even surpasses imported strains in terms of tolerance, activity, efficacy and diversity, and currently claims that it has a resource bank of 12,000 strains and has laid out more than 30 patent barriers around PC-01 and Youyi C products.

Yili has also been deploying probiotics for a long time, such as spending ten years to build a platform covering the upstream and downstream of the probiotics R&D and application industry chain, Quanjiayi, and currently independently developing three proprietary probiotic strains "BL-99, K56 and ET-22" with China's independent intellectual property rights, and widely used in its products.

Bright Dairy currently has more than 5,400 strains in stock, and has also cooperated with Jiangnan University to realize the transformation of the invention patent gold medal strain "Lactobacillus plantarum CCFM8610";

New Hope cooperated with West China Medical College of Sichuan University to develop Rhamnobacterium GRX10 and launched the high-end yogurt "Huorun";

From the external publicity of dairy companies such as Mengniu, Yili and Guangming, it is not difficult to see that domestic probiotics have not only achieved success in research and development, but also applied in their yogurt and lactic acid bacteria drinks, and China's dairy industry seems to have firmly held "milk bottles in the hands of Chinese themselves." ”

[2] The dairy industry is still "stuck", and breaking through the "stuck neck" is self-congratulatory

Corresponding to the continuous promotion of "successful cultivation of probiotic strains" by major domestic dairy groups, domestic probiotics are still in a marginal position in terms of market share and other data, and foreign capital controls the throat of China's probiotic industry.

Relevant data show that China's probiotics market is still controlled by two foreign manufacturers, DuPont of the United States and Chr. Hansen of Denmark, accounting for 85% of the domestic probiotics market, and the market share of Chinese probiotics manufacturers is less than 10%, and 100% of the infant probiotics used in infant formula milk powder need to be imported, and foreign capital has the absolute right to speak and price.

"Although the domestic report on what kind of breakthrough has been made in the research and development of probiotics to solve the problem of stuck neck, but the real market is that the market share of foreign manufacturers has not changed", a media person who has been tracking the dairy industry for a long time revealed to the Treasury Finance and Economics that it is more self-entertaining to solve the problem of stuck neck, and the price of domestic probiotics of the same category and quality is 20% lower than that of imported probiotics in order to have a market.

(Source: Internet)

Probiotics are completely unable to achieve domestic replacement, and China's probiotics market is still growing, data show that from 2018 to 2022, the average annual compound growth rate of probiotics production reached 14.12%, and the market size increased from 36.778 billion yuan to 68.816 billion yuan.

The market is growing rapidly, Mengniu, Yili, Guangming these dairy companies are not lacking in capital and technology, why have domestic probiotics been unable to solve the "stuck neck" problem for a long time?

First, the clinical verification cycle is long, as an edible and improved body function of microorganisms, the China Food Industry Association took the lead in issuing the "Probiotic Food" group standard, making four specifications for probiotic strains.

(1) the strain number and isolation source should be clarified, (2) the identification, preservation and safety evaluation should be carried out by a third-party institution, (3) the whole genome sequencing should be supported by relevant scientific literature, and (4) the scientific literature should be supported by human or clinical trial studies.

At present, the research and development time of domestic probiotic enterprises is relatively short, Mengniu Yili and other enterprises have only cultivated strains for about ten years, and DuPont has spent more than 40 years in order to cultivate the "Lactobacillus acidophilus NCFM" used in infant food, and there are nearly 4,000 clinical trials before marketing.

Second, the industrialization requirements are strict, and the probiotics announced by China Dairy are all at the laboratory level, such as Guoren and Guoren 2, which Mengniu isolated from space, have not yet come out of clinical trials and are far from industrialization.

"The laboratory level is not the same thing as industrialization, which has strict requirements for the production environment, storage and transportation methods," an investor who tracks the food industry told Treasury Finance that the strains and starter cultures used in domestic probiotic yogurt are almost monopolized by foreign companies.

[3] The dairy industry was "stuck" and there was no substantial breakthrough

The dairy industry is an industry that affects the livelihood of tens of millions of herdsmen upstream, and is related to the health and safety of hundreds of millions of consumers.

However, no matter how China's major dairy companies publicize innovation and breakthroughs, China's dairy industry has been "stuck" in the most basic and important link, and there is no power to fight back in the face of foreign companies.

Forage: Alfalfa grass protein content accounts for about 17%-20% of the total hay mass, and it is a high-quality roughage for animals to feed. However, at present, the domestic alfalfa commercial grass area has reached about 1.3 million mu, and nearly 90% of it is imported. The reason why forage grass seeds are heavily dependent on imports is that their nutritional value is different.

According to the Treasury Finance, only calcium, the calcium content of imported forage grass exceeds 30% of domestic forage, in order to raise good cattle and produce more milk, domestic pastures are mainly imported from the United States, Australia, Spain and other countries.

Breeding cows: Dairy cows must have good cattle in order to be productive. According to the data, in 2020 alone, the total number of domestic imported dairy cows was 260,000. According to the data, the average milk production of domestic dairy cows in 2020 was 0.83 tons, and the milk production of domestic dairy cows in 2023 will reach 1.2 tons.

But at the same time, importing countries such as New Zealand have refused to sell frozen sperm eggs from breeding cattle and high-yielding dairy cows to China, and 20% of China's dairy cows still need to be imported from abroad.

(Source: Internet)

In the past few decades, China's dairy industry has developed rapidly, and the courtesy goods of visiting relatives during the holidays have gradually become essential daily consumer goods for families. According to the data of the National Bureau of Statistics, in 2023, China's total output of raw milk will be 41.97 million tons, and the output of dairy products will be 30.546 million tons, an increase of 6.7% and 3.1% year-on-year, respectively. The rapid growth of China's dairy industry has also contributed to China's dairy enterprises, with Yili and Mengniu ranking fifth and eighth respectively in the 2023 list of the world's top 20 dairy companies.

The consumption of dairy products is growing, and the revenue scale of dairy enterprises is growing, but China's dairy industry seems to be a huge and stable industrial chain, but it is leaking everywhere, from the source of high-quality forage, high-yield dairy cows, to probiotic strains, major domestic dairy companies continue to publicize new breakthroughs, break the "stuck neck", but in fact, the fact that it is "stuck neck" has not changed, and there is no change in the number and market share of grass seeds, dairy cows, and probiotics.