Chapter 17 Fighting a Turnaround

"The pig breeds independently bred by our group have outstanding indicators. The meat yield rate of ordinary pigs is about 80%, but the meat yield rate of the pig breeds bred by our group can reach 83%. That is to say , a 200-pound dry feed pig, slaughtered about 170 pounds of bone-in meat, including 25 pounds of tenderloin, 20 pounds of ribs, 20 pounds of large bones, 50 pounds of front and rear legs, 30 pounds of pork belly, and 25 pounds of tenderloin."

"This is roughly the data."

Pigs are divided into dry feed pigs and wet feed pigs.

Dry feed pigs - drained, with bones, and after removing impurities, the meat yield rate is between 67% and 73%. Wet feed pigs are generally fed free range, and the meat yield rate is based on The fat and thinness are different, ranging between 60 and 75%. They are also drained, with bones and impurities removed, and the fluctuation is larger.

However, this is an ordinary three-yuan pig breed, and the pig breeds of [Chaoqun Group] are not ordinary.

“Last year, our group’s [pig farms] produced a total of 25.5 million pigs and produced 2.116 million tons of pork. In order not to impact the domestic pork market, in accordance with Dong Wu’s instructions, we processed two-thirds of the raw pork. Frozen, dynamically stored, only a third of raw pork is put on the market.”

In 2018, the national pork production was 54.04 million tons.

[Chaoqun Group] These 2.116 million tons may not seem like much, but they only account for 3.9% of the total.

But this was unplanned output.

Once [Chaoqun Group] puts all the pork on the market, it will inevitably cause the entire market to collapse and the price of live pigs to plummet.

It doesn't matter that [Chaoqun Group]'s overall pig cost is low, and even its sales channels are owned by itself, but other people in the pig industry chain, whether they are farmers or pork sellers, will suffer losses.

This goes against the long-standing principles of [Super Group].

In addition, Wu Siyuan saw that the supply of pork would seriously exceed demand in the future, leading to a sharp rise in pork prices. Naturally, he wanted to reserve food for the future. Naturally, he would not do anything to disrupt the market at will, but chose to freeze and store a large amount of these raw pork.

The preservation technology of frozen meat is not simple, on the contrary, it is very complicated.

During the freezing process, you need to go through multiple processes such as [pre-cooling and acid removal], [meat pre-freezing treatment], [freezing speed control], [primary freezing], [secondary freezing], [frozen meat refrigeration], etc., so that it can Minimize all kinds of losses of meat during the long freezing process.

However, if you operate this way, frozen meat will be inferior to fresh meat in terms of taste, aroma, and freshness. This is why outsiders are keen to buy [fresh pork]. However, in terms of nutritional value and food safety, there will be no What a difference.

In addition, freezing pork after processing is not something that can be done once and for all. It cannot be frozen for several years or decades.

There is some so-called "zombie meat" on the market, which refers to frozen meat that has been frozen for many years and disappeared from the market.

Most of these [zombie meat] are smuggled goods. The smuggled frozen goods do not enter the customs through normal channels and have not undergone any inspection and quarantine. The quality and safety cannot be guaranteed. The quality of meat that has been frozen for many years will be worse than that of fresh meat, and as long as there is no thawing during the freezing process, it is difficult to tell the difference in appearance and taste.

Out of the need for strategic reserves and stable prices, countries will take the initiative to freeze and store large amounts of meat, which is the main source of "zombie meat" in my country.

After this [zombie meat] enters our country without concealment, it is usually shipped to second- and third-tier cities, and its target is small restaurants.

Their cheap prices make them popular among small catering self-employed people.

In addition, foods that are heavy on salt and ingredients, such as [Pickled Pepper Chicken Feet], are also the main uses of [Zombie Meat].

Sprinkle salt and pepper for free, and you don’t even know whether what you are eating is meat or feces!

Some of these [zombie meats] are older than the consumers. Chicken wings from the 1970s and pork legs from the 1980s are not uncommon.

During the transportation process of smugglers, due to the lack of perfect cold chain logistics, these [zombie meat] will continue to thaw. The thawing process is the growth of microorganisms and bacteria, which will cause these frozen meats to become rotten and smelly, causing problems for users. It can cause great harm, may cause food poisoning, accelerate aging, reduce resistance, etc.

[Chaoqun Group] naturally will not keep the pork frozen for the sake of temporary convenience.

They adopt the dynamic meat freezing method.

Theoretically, pork can be frozen for one year at minus 18 degrees Celsius.

Of course, if the time is too long, the moisture in the pork will be lost.

Even in a frozen state, meat will lose moisture. In the technology of frozen meat, this is called "dry loss", that is, the water sublimates and the solid water molecules directly vaporize, which will cause the quality of the meat to deteriorate. This is freezing The reason why the meat is not as good as hot fresh meat in terms of aroma and taste.

[Chaoqun Group] In order to ensure the quality of the pork as much as possible and maintain the taste and aroma of the pork, of course the pork will not be frozen for a year.

According to experimental tests, [Chaoqun Group] allows pork to be frozen for no more than nine months.

Every other month, the earliest batch of pork is sold.

Thanks to the excellent freezing technology and the excellent quality of [Chaoqun Group]'s unique pig breed, the aroma and taste of pork frozen for nine months are not much worse than the so-called [hot fresh meat]. The quality is worse than [chilled meat].

Many housewives cannot tell the difference between [Chaoqun Group]'s frozen pork and ordinary hot fresh meat.

There are three main types of pork on the market.

One is frozen meat. It is stored in a cold storage at minus 18°C ​​and is displayed in supermarket freezers. After being frozen and preserved, the taste and nutrition of this kind of meat have greatly deteriorated. However, the advantage is that it is cheap. If it is stewed properly, it will not be different from normal meat. Not big.

The other is hot fresh meat. That is, meat that has just been slaughtered in the early morning of that day, and then cut into pieces and taken to the market for sale. This kind of meat is usually stored at room temperature, the price is moderate, the taste is average, and the nutrition is well preserved, but the hygienic conditions are much poorer. After all, you don’t know how many flies you have been bitten by during the transportation of pork at the pork stall in the wet market.

The last type is cold meat, which usually appears in the chilled section of supermarkets. It has perfect taste, moderate price and well-preserved nutrients.

[Chaoqun Group] The taste and aroma of pork that has been frozen for nine months are no worse than ordinary pork, and the taste and aroma of freshly slaughtered hot meat are naturally better, which is just worse than their own boutique [Sanwei Xiang Pig] .

This is why [Chaoqun Group] has the confidence to use this frozen pork to supply its own fresh food retail brand store [Xiao Xianrou].

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"Currently, there are 1.27 million tons of frozen pork in cold storages across our group." Guan Xue reported a figure.

"This storage quantity is still a bit low!" Wu Siyuan pondered for a moment and said.

Guan Xuelie was shocked when he heard this and said, "Dr. Wu, 1.27 million tons is not a small amount. If it is increased..."

It is normal for Guan Xuelie to be worried.

But Wu Siyuan has a pair of eyes that can see fragments of the future.

Only he knows how big the pork gap will be in the future!

In 2018, global pork consumption and supply were around 110 million tons, of which China accounted for about 50%. China's pork production is about 52 million tons, and its consumption is about 54 million tons.

In 2019, China's pork production will be reduced by between 11 million and 13.75 million tons.

This is a serious impact caused by African swine fever.

This is a heavy blow, and the seriousness behind it is something that many people have not seen.

In rural areas, when swine fever occurs in a farmer's household, no more pigs will be seen within a dozen miles because the local government will cull them.

For their own benefit, farmers have a very simple and crude way of dealing with it - selling them secretly.

This is why pork prices plummeted after the outbreak of African swine fever.

The price of pork is like a roller coaster. If it fluctuates, pig farmers will make almost no profit or even lose money.

Under such circumstances, many pig farmers have given up raising pigs.

With the emergence of new environmental protection laws, local governments have shut down many pig farms.

This has resulted in a growing shortage of live pigs.

And pig breeding has a lag.

Many people think that this African swine fever, like the previous outbreaks of swine fever, is just a gust of wind. Under the strong control of the government, prices will not fluctuate much.

But they all miscalculated.

Everyone had miscalculated.

By the time it really comes to light, the pork problem cannot be properly solved.

China's pork production in 2019 was around 39.63 million tons. If consumption remains unchanged in 2018, the pork gap will be approximately 14.37 million tons.

The total annual pork production value in the United States is only more than 10 million tons.

The U.S.'s annual pork production cannot close China's gap.

One can imagine how big the pork gap will be in 2019.

Therefore, the 2.17 million tons of pork stored by [Chaoqun Group] may seem like a lot, but when it comes to use, it is really a drop in the bucket and not enough!

"Is there any problem?" Wu Siyuan's eyes moved and he asked softly.

"Funds!" Guan Xuelie said directly.

Wu Siyuan suddenly understood and understood Guan Xuelia's worries.

At the beginning, [Chaoqun Group] borrowed 30 billion yuan from the bank and withdrew a large proportion of its own profits to invest in the construction of [pig farms] and [cold storage]!

[Cold Storage] Needless to say, the time required to pay back the capital may take ten years.

As for [Pig Farms], more than 60% of the pork produced by breeding pigs is frozen in the [Cold Storage], and only less than 30% of the pork flows into the market, which leads to While the [Pig Farm] is burdened with heavy debts, it is also in a state of huge losses.

Getting back the money is even more elusive.

Wu Siyuan plans to increase the amount of pork stored, which will inevitably increase the losses of the [pig farm] business.

If it is not handled well, it may cause heavy losses.

Guan Xuelie is a responsible manager, and he said this from the perspective of the group.

"I understand." Wu Siyuan nodded, and after a pause, he added, "However, Mr. Guan, this African swine fever is not as simple as the previous outbreaks of swine fever!"

"I already have reliable data. A large number of pig farmers have given up raising pigs, and as African swine fever continues to rage, the number of abandoned pigs will further expand."

"The combination of previous one-size-fits-all policies on environmental protection has led to the closure of many large and medium-sized pig farms."

"Mr. Guan, Mr. Su, do you know what this means?" Wu Siyuan asked his two senior executives.

"Gap!" Guan Xueliang reacted immediately, his eyes lit up, and he said, "After the wave of pig farmers abandoning and abandoning pigs, the problem of pig gap will expand, which will then be reflected in the price of pork!"

"Smart!" Wu Siyuan praised without hesitation.

Guan Xuelia's expression was happy at first, and then changed again. He hesitated and said, "Director Wu, do you mean that the 2.17 million tons of pork prepared by our group will not be able to meet the future domestic demand?"

"Yes!" Wu Siyuan nodded and said, "At least the storage capacity must be expanded five times to barely guarantee the stability of pork prices in the future."

"so much!"

Guan Xuelia and Su Shixian both looked shocked when they heard this.

"Yeah! I'm still making a conservative estimate!" Wu Siyuan said with certainty.

Neither Guan Xuelia nor Su Shixian doubted the accuracy of Wu Siyuan's guess.

In terms of strategic outlook, I have to say that Wu Siyuan has not missed it yet.

The group has grown from a small fruit shop to a giant enterprise spanning multiple industries, relying on Wu Siyuan's strategic decisions time and time again.

Guan Xuelia and Su Shixian were the first veterans to follow Wu Siyuan, and they had long been convinced by Wu Siyuan in this regard.

However, Wu Siyuan's requirements this time were still too high. Although Guan Xueliang did not doubt Wu Siyuan's strategic vision, he was not confident that he could complete Wu Siyuan's tactical execution. He said in embarrassment, "Dr. Wu, this quantity is too big." Already..."

"I understand your difficulty." Wu Siyuan waved his hand and said, "Expanding the pork storage capacity by five times is just our goal. Just go ahead and do your best. I will mention a few points below."

"First, compress the storage capacity of other materials in the cold storage and increase the storage range of pork."

"Secondly, the price of pork outside is now cheap, so you can purchase it in appropriate quantities and freeze it for storage."

"Third, expand the number of pigs in existing pig farms and increase pig breeding as much as possible on the basis of strict epidemic prevention."

"Fourth, if the cold storage area is still not enough, you can rent a cold storage to store frozen pork."

"fifth……"

Wu Siyuan Balabala said a lot.

Guan Xueliang's face became more and more bitter the more he listened.

After Wu Siyuan finished speaking, he turned into a bitter melon.

Wu Siyuan was angry and funny, and asked, "Is there any question?"

Guan Xuelie nodded.

"what is the problem?"

"No money!" Guan Xuelie answered simply.

How pitiful!

The group has now established a business department and is responsible for its own profits and losses.

The Agriculture and Animal Husbandry Development Division used to have a good life, but after launching this [Pig Farm] project, all the profits were filled in, but the entire division is still in the red every year.

You know, the profitability of a business unit is related to the richness of the year-end bonus of the business unit CEO.

Although Wu Siyuan has taken this into consideration in the past two years and favored Guan Xueliang in terms of year-end bonuses, Guan Xueliang's year-end bonus is still not as generous as Su Shixian's.

The losses were already very serious, but now Wu Siyuan has asked Guan Xueliang to continue to invest a large amount of money. If he cannot quickly recover his capital and turn losses into profits, Guan Xueliang's year-end bonus will also shrink.

Wu Siyuan could see the Xiao Jiujiu in Guan Xuelia's heart at a glance. He patted Guan Xuelia's shoulder and said, "Lao Guan, if you don't have any money, the group will lend you money!"

borrow? Guan Xuelie smiled bitterly.

Then Wu Siyuan added, "But I promise, you don't have to finish 2019, you can rely on this batch of pork prices to fight a turnaround!"

"Okay, just do it! The group will support you." After Wu Siyuan said to Guan Xuelia, he turned to look at Su Shixian and asked, "Mr. Su, please report on the operations of your terminal retail division. situation, especially the opening of [Xiao Xianrou] store.”

"I want to know where the pork produced by our own group can be sold!"