Analysis of socio-economic and agribusiness developments in the Chinese beef and cattle industry

• Chinese Academy of Social Sciences, China
• Chinese Academy of Agricultural Sciences, China
• Ministry of Agriculture, China

Beef production in China expanded more than 15-fold between 1978 and 1994. This astonishing rate of increase was far greater than that of the pig or poultry sectors. Chinese beef grew into an enormous industry by world standards; at the time this project began China had 123 million cattle producing 3.3 million tonnes of beef per annum. The industry was modernising and commercialising at a remarkable pace, and in recognition of this the Chinese Ministry of Agriculture designated beef a major area of research.
The sudden growth and change in the beef sector was having major effects on the traditional production and distribution system, as well as on rural development in certain parts of China. Not all of the effects were necessarily beneficial. There was an urgent need to develop policies and strategies at the local, regional and national levels to guide the future development of this important new source of protein. Sensible handling of the beef industry was regarded as critically important for the future sustainable development of China's pastoral regions.
Small feedlots were starting up in China and likely to become increasingly important. However, most existing feedlots were small-scale individual enterprises with generally low levels of technical and managerial expertise. The long experience of Australia in beef production was regarded as an asset to both countries. To this end, the Meat Research Corporation (MRC) in Australia funded the agribusiness component of the project.

The main aim of this project was to gain a comprehensive overview of the recent substantial changes in the Chinese beef and cattle industry. An important objective was to help Chinese and Australian beef industry officials formulate strategies and policies to take advantage of the recent developments in the Chinese industry.

Researchers drew information and data from both official and unofficial sources in China. The newness of the beef industry there meant that official statistics were not always well developed and therefore required verification and careful interpretation. Databases were developed for variables such as cattle numbers, beef production and consumption, turnoff rates and carcass weights
The project team also collected information on social and environmental factors. The fieldwork sites were chosen to ensure that all production systems, marketing issues and local government policies were covered and to allow for comparative analysis. Of particular relevance were work patterns within households, changes in income distribution and the impact of the increased emphasis of cattle-raising on pasture degradation.
Information on the use of effluent from feedlots and the dispersion of pollutants from feedlots and abattoirs was also collected. This type of information was not readily available from published sources and required extensive fieldwork and interviewing.
Researchers sought to identify the key policy issues relevant to the economic, social and environmental effects of the changes in production and marketing systems, and to examine the agribusiness and trade opportunities afforded by the latest developments in China.

In the course of undertaking a comprehensive analysis of the socioeconomic and agribusiness aspects of developments in the Chinese cattle and beef industry the project researchers examined many specific areas and grouped them into various dimensions of the analysis. Development was a central component of the project, and the main focus was the two-way relationship between industry development on the one hand and rural incomes, government revenues and other social issues on the other.
The regional dimension became a key aspect of the project. Researchers identified the spatial distribution of the cattle and beef industry as a crucial theme, and incorporated issues of regional comparative advantage, integration and development.
Agribusiness impacts were a major part of the overall project. The team analysed how overseas agribusiness interests could help improve marketing channels and supply chains to assist industry and rural development.
The project made a strong contribution to the study of environmental aspects of the beef industry. Whilst Chinese decision-makers emphasised the positive but not the negative environmental effects of industry development, both were explored in the project.
The main forms of project output were publications and an 'end-of-project' workshop. A large number of publications appeared in both English and Chinese, with emphasis placed on ensuring that key results were published through widely available Chinese sources. Publications were diverse, taking the form of substantive research reports and papers as well as conference papers, the intent being to disseminate and peer-review findings of the research in the widest possible way.
The list of publications also included many student theses associated with the project. While none of the eight students received direct assistance from the project in terms of salaries or research expenses, they benefited through access to project information and personnel, participation in fieldwork interviews, and other indirect benefits from loose association with the project. Conversely, the project gained much from their contributions by allowing specific areas to be covered in much greater detail than would otherwise have been possible.
The study produced a database of contacts throughout the Chinese cattle and beef industries that contains in excess of 300 contacts and a reference database of over 500 references pertaining to the study. Another important project-initiated resource is a catalogue of field reports that present an unedited record of the 400+ interviews.
The project forged closer links between the various participants within the Chinese beef industry and enhanced the research capability of the collaborating Chinese institutes. The outputs also alerted Australian industry to the likely trade opportunities that are emerging as the Chinese industry seeks to continue its modernisation. Although the Sino-Australian beef trade is small, the developments in China could markedly alter the nature of the North Asian beef market, which is one of Australia's most important outlets. This project provided important economic information about this for the Australian beef industry.