Chinese machinery firm eyeing markets in South America, report Zhong Nan and Guo Jun.
After riding the domestic growth wave for more than two decades, Muyang Co Ltd, the largest Chinese feed machinery manufacturer by revenue, aims to expand its footprint in South America.
It expects to have many opportunities as nations in the region modernize their animal husbandry and oilseed processing industries, which aim to export more and better agricultural products.
According to estimates by Grand View Research Inc, a San Francisco-based market research and consulting company, the global feed additive market will reach $20 billion in 2020, thanks to surging demand from the Asia-Pacific region, South America, the Middle East and Africa.
Based in East China's Jiangsu province, Muyang has an 8 percent share of the market in South America, where sales amounted to $40 million last year. It is especially active in Brazil, Colombia, Venezuela and Cuba.
Liu Guangdao, vice-president of Muyang, said that animal husbandry has long been a core industry for the continent, and demand for feed machinery is strong－but there is tough competition from Western companies.
Eager to grab more market share, Muyang has established nine sales offices and maintenance centers throughout South America. It also plans to build a manufacturing facility in one South American nation, which it has not identified, over the next five years. That facility will enhance its ability to build an efficient supply chain and service network.
"In comparison with Western companies, such as those from the Netherlands, France and Germany, we are able to offer fast and flexible financing to our clients," Liu said.
Founded in 1967, the company has built a presence in more than 80 countries and has more than 3,000 employees. It is also investing heavily to recruit local staff for its future plant in South America. And it is seeking more Chinese employees who are fluent in Spanish and Portuguese.
Booming global market conditions aside, South America's rising demand for feed machinery also indicates the health of the continent's economy and the size of its population
"In South America, meat consumption is rising, and people are eating a broader variety. The daily diet, including meat, fish, eggs and milk, has become more sophisticated, and people now look for more choices for healthy and convenient food," said Ding Lixin, a researcher at the Chinese Academy of Agricultural Sciences in Beijing.
"In terms of agricultural modernization, South America is on an upward trajectory, especially in the meat production chain. Pork, chicken and beef are being produced increasingly using modern methods. Fewer animals are being raised in backyards, and more are in a modern feeding system," Ding said.
To promote the global use of feed machinery, Muyang also worked with various international organizations and government agencies from the United States, Spain, Denmark and South Korea to establish the Feed Machinery Technical Committee of the International Organization for Standardization earlier this month.
The organization's secretariat is also located in Muyang's headquarters in Yangzhou.
Muyang also has its eyes on Africa, where there is abundant land, and governments want to expand food sales abroad to broaden their export channels.
Sun Xuqing, another Muyang vice-president, said there is much potential for many African nations, where manual farming remains the norm amid a transition to modern farming machinery.
Sun said the company sees opportunities to not only provide its machinery but also offer after-sales services.
