Competition in China’s aquafeed sector continues to heat up, with a leading animal feed firm entering the sector just as two leading players engage in a price war to grab market share.
Zonghai Aquatic Science and Technology Group recently opened a new CNY 60 million (USD 9 million, EUR 7.9 million) aquafeed processing plant in the Zhangzhou district of Fuzhou, in the heart of south China’s aquaculture sector. With a capacity of 200,000 metric tons per year, the company aims to double production at the plant within the next five years to compete with leading Chinese aquafeed players like Guangdong Haid and Tongwei Group.
The majority shareholder in the new venture, Te Qu Livestock Science and Technology Co., claims to be the leading producer of pig feed in southwest China and has partnered with local firm Meishan Zonghai Management Consultancy Co. on the plant.
Its opening is the latest sign that China’s aquaculture feed sector is attracting investment from leading pig feed firms keen to tap into perceived future growth potential. It also comes as Haid and Tongwei are engaged in a price war, with the former offering vannemei shrimp feed for CNY 300 (USD 44.73, EUR 39.53) per ton this week in southern China, down from a 12-month high of CNY 480 (USD 71.56, EUR 63.25).
“We want to produce feed but we will also sell fry and antibiotics,” Zonghai Head of Product Bai Shi Jun said. He pointed to growth potential in China’s aquafeed sector, and to an absence of the same major players who’ve risen to dominance in the pork sector.
While there are opportunities in the sector, he warned there are also many companies interested in diving in.
“Competition will intensify,” he said.
