Liu Chao, vice chairman of the China Dairy Industry Association: Structural excess and shortage in the dairy market coexist

Dear leaders, dairy colleagues and media friends, good afternoon, I am very happy to participate in the fourth China Dairy Capital Forum organized by Securities Daily, I saw in the background materials of the forum, I wrote that 2021 is the beginning of the "14th Five-Year Plan", but also continue to promote the double cycle into a new development pattern of a year, involving the international people's livelihood of the dairy industry after withstanding last year's epidemic test, is at the historical node how to open a new bureau, seek a new chapter, to create a new engine for the high-quality development of China's dairy industry, Become a top priority for the industry and enterprises. Various factors have superimposed, and the dairy industry has ushered in more challenges and shown a high-speed development trend, which has given the capital market the confidence to invest. At this special moment in the opening year of the "14th Five-Year Plan", Securities Daily wants what the industry thinks, is anxious about the industry, and does what we want to do, so on behalf of the China Dairy Industry Association, I express my heartfelt thanks to the Fourth China Dairy Capital Forum held by Securities Daily, and wish the forum a complete success.

During the "13th Five-Year Plan" period, China's dairy industry has made remarkable achievements in processing technology and equipment, enterprise management, laws and regulations, product quality and safety, product quality upgrading and strengthening the construction of dairy product characteristic areas. China's dairy industry has become a food manufacturing industry with the world's advanced level of modernization, and this good situation should be said to continue to this day. According to the data of the State Land Administration, only from January to July 2021, the output of liquid milk in China increased by 14.61% year-on-year, the output of dairy products increased by 8.53% year-on-year, the national dairy processing and sales revenue increased by 14.22% year-on-year, and the total profit increased by 39.09% year-on-year, and the increase in sales revenue was far greater than the increase in products, which shows that after the epidemic, consumption upgrades are obvious, and the overall trend of enterprise products is high-end. From January to August this year, because of the strong market demand, China's dairy imports refuted the rapid growth. A total of 2.8545 million tons of various dairy products were imported, an increase of 31% year-on-year. The import value increased by 17.7% year-on-year, and the converted fresh milk increased by 28.8% year-on-year, and the continuous growth of imported products shows that China's dairy market demand is strong and has great potential.

The semi-annual report of listed dairy companies also shows that the overall momentum of the industry is growing strongly, and the growth of most listed dairy companies has reached double digits. Some dairy enterprises have grown by more than 50%, and the specific data of Yili, Mengniu and Sanyuan that we attended today have been made public, so I will not repeat it here.

This year is the centenary of the founding of the party, under the leadership of the party, our country has a comprehensive and healthy well-off society, is moving towards the goal of building a socialist modern power in an all-round way, which has laid a solid material foundation for the development of China's dairy industry, added a cup of milk to a healthy China, and met the people's yearning for a better life, which is the historical responsibility and mission of China's dairy industry. In addition, the advent of the era of great health has also laid a solid social foundation for the development of the dairy industry. The new crown epidemic has changed many of our lifestyles, people pay more attention to nutrition and health, there is a parameter, called national health literacy (sound), this data is currently internationally recognized to measure the level of development of a country, but also a comprehensive indicator of nutrition and health. In developed countries, this data is on average to reach 32%, and in the past, the National Health Commission also vigorously promoted the publicity of national health literacy. The effect is not so obvious, but last year's new crown epidemic year, the national health literacy increased by 4 percentage points, indicating that everyone is now very concerned about their own health, concerned about their own nutrition, but also know that by drinking milk can improve our body's immunity. However, with the rapid development of the dairy industry, deep-seated problems have become more and more prominent, such as the price of our raw milk and the growth of dairy products, the imbalance of regional development, the coexistence of excess and shortage of dairy market structure, which is also increasingly dependent on the international market, which has affected the healthy and stable development of our industry.

First, the dairy market is in a structural surplus and shortage of coexistence of contradictions, since the reform and opening up, dairy products is one of the fastest growing industries in the food manufacturing industry, in 1978 the national resistant output was only 971,000 tons, last year we reached 34.4 million tons, an increase of 35 times, per capita share of the past less than a kilogram, growth to now nearly 40 kilograms, whether urban or rural, a variety of dairy products are dazzling, sufficient supply. But the original type of milk powder, cheese, cream, milk lightweight products.

Second, the dependence on the international market is getting bigger and bigger, at present, China imports dairy products from nearly 60 countries and regions in the world, the types of imports are complete, and the amount is increasing year by year to reach a quarter of the total world dairy trade. In 2020, the total value of imported dairy products in China was 102.621 billion yuan, equivalent to 24.5% of the total output value of the domestic dairy industry.

Third, China has entered the world's high milk price industry, "during the "Thirteenth Five-Year Plan" period with the continuous prominence of small-scale family cattle raising, the scale of dairy farms expanded, dairy farms led to an increase in feeding costs, the average price of fresh milk in ten provinces and cities in China, October 2015 was 3.47 yuan kg, last October was 3.95 kg, in October this year milk prices have been fluctuating at 4.37 yuan kg, and the international milk price in the same period is basically at a price of more than 2 yuan, so with the arrival of the fourth quarter dairy sales season, we predict that milk prices are still difficult to adjust. In the face of the real problem of what to do with the dairy industry, "Securities Daily" seems to give us ideas, that is, to take precautions, active layout, and strengthen confidence in the development of the industry.

First, we must unswervingly take the road of industrial development of the whole industry and vigorously develop dairy farming. Second, guided by win-win cooperation, promote the stable development of the industry, advocate and support processing enterprises and dairy farms to carry out vertical development, and increase the ability to resist risks with the advantages of the industrial chain. Third, to optimize the product structure of scientific and technological innovation to provide products, because of the importance of the development of adult powder, attention to the development of cheese, cheese, milk protein, milk light powder, lactose, in order to solve the supply. Fourth, promote the further upgrading of the industrial chain, improve laws and regulations, formulate corresponding standards for new raw materials, new categories, and new processing technologies, use standards to escort product safety and industry upgrades, promote the green and low-carbon development of the industry, and enhance the consumption reduction and energy saving of dairy processing enterprises, and the comprehensive treatment of sewage and sewage. Promote the intelligent development of the industry and make use of the advantages of the whole industry chain of the Internet and the Internet of Things. Through the collection of information monitoring and analysis and technical control to establish a sound dairy products guarantee platform, fifth, strengthen the cultivation of the specialty milk market, characteristic milk with Chinese characteristics including sheep milk, yak milk, buffalo milk, special milk to help enrich the varieties of dairy products, to meet the needs of market segmentation, sixth, strengthen the layout of the double cycle, accelerate the process of internationalization, in recent years we have gone out of the dairy enterprises, including Yili, Mengniu, Guangming, Travel. Oceania and the Middle East have established our investment in factories and acquisition enterprises, using foreign resource advantages to produce products, making up for the domestic market at the same time, relying on foreign factories to enter the international market. To enhance the brand, international visibility and influence of Chinese dairy enterprises. Dear dairy colleagues, the "14th Five-Year Plan" period is an important development period for the core structure of China's social and economic development, entering a century of social change and development opportunities, scientific analysis of the problems existing in China's dairy industry, to cope with the opportunities and challenges of industry development, to grasp the direction of industry development, to establish a sustainable development innovation system, and to continuously promote China's dairy industry to move towards a dairy power, how to create a new pattern of dairy industry, how to make the cheese industry bigger and stronger, Probiotic industrialization development opportunities and challenges are wonderful, are our dairy industry concerned about the topic, I wish the conference a complete success, thank you!