Feed­ing Chi­nese tech to the world

Well­hope Agri-Tech is go­ing full steam ahead to dom­i­nate the animal feed in­dus­try

China Daily (Hong Kong) - - BUSINESS - By WU YONG in Shenyang wuy­ong@chi­nadaily.com.cn

Wang Zheny­ong has just ap­plied for his fourth pass­port. That’s be­cause as over­seas busi­ness vice-pres­i­dent of Well­hope Agri-Tech Joint Stock Co, China’s lead­ing feed pro­ducer and broiler meat pro­ces­sor, he trav­els a lot and the pages of his pass­port get filled up quickly with visas and ar­rival stamps.

Wang’s an­nual busi­ness trav­els in­clude, but are not lim­ited to, five vis­its to In­dia, four trips to the Demo­cratic Peo­ple’s Repub­lic of Korea, three land­ings each in Rus­sia and Iran, one visit each to Nepal and Uganda — all to ex­pand Well­hope’s global foot­print.

He notches up 300,000 miles (480,000 kilo­miteres) ev­ery year. He is a top cus­tomer for many air­lines. By the end of this Oc­to­ber, Wang helped set up three joint ven­tures in In­dia, Iran and the Philippines.

And an­other two are un­der ne­go­ti­a­tion. In­ter­na­tional mar­kets have al­ready con­trib­uted over 400 mil­lion yuan ($57.9 mil­lion) in rev­enue to Well­hope.

Founded in 1995, the Shang­hai-listed Well­hope’s Jan­uary-Septem­ber rev­enue reached 8.48 bil­lion yuan, up 15 per­cent year-on-year.

On Oct 20, the com­pany an­nounced that it in­vested 24 mil­lion yuan in a feed pro­duc­tion and pig breed­ing fa­cil­ity in Manila, the cap­i­tal of the Philippines. The joint ven­ture would hire around 500 lo­cal work­ers, ac­cord­ing to Wang.

This will help Well­hope to el­bow its way into the lo­cal mar­ket that has a pop­u­la­tion of over 100 mil­lion.

“The Philippines is one of our tar­gets over­seas as it has short­age of meat sup­ply but abun­dant wa­ter, soil and la­bor. South­east Asia, South Asia and East Africa are on top of our agenda,” said Jin Wei­dong, chair­man of Well­hope.

The com­pany has tied up with South­east Feeds Spe­cial­ist Corp in the Philippines. “We are grate­ful for Well­hope’s trust and we would never in­fringe on Well­hope’s ben­e­fit. And af­ter re­tire­ment, our suc­ces­sors will also write such a guar­an­tee,” said Ge­orge Co, gen­eral man­ager of South­east Feeds.

Jin ex­pects in­ter­na­tional mar­kets will ac­count for 500,000 met­ric tons of feed sales and net profit will reach 100 mil­lion yuan be­fore 2018.

“The in­ter­na­tional sec­tor gen­er­ally con­trib­utes over one-third of the rev­enue for big names in the field such as Charoen Pokp­hand Group, Cargill and ABN. In the fol­low­ing 10 years, our aim is to be the top 10 in feed in­dus­try around the world,” said Jin.

Well­hope is among the first few Chi­nese agri-tech com­pa­nies that started to ex­pand glob­ally over a decade ago. In early 2005, the com­pany signed a joint ven­ture con­tract with the Vaidya fam­ily in Nepal, an in­flu­en­tial in­dus­trial player in the re­gion.

The Nepalese ven­ture proved to be a big suc­cess in the fol­low­ing years and set the bench­mark for the feed busi­ness in the coun­try.

“More im­por­tant is that the Nepalese com­pany worked as a seed for the mar­ket. That seed will sprout and soon branches will be vis­i­ble,” said Wang. “Go­ing global may be hard. But the hard­est thing was to con­vince my col­leagues who could not speak English and feared to go abroad.”

But Wang did not worry af­ter 2011 when China’s feed mil­lion yuan mar­ket saw sur­plus. China’s over­all an­nual out­put reached the peak of 200 mil­lion tons, ac­cord­ing to re­search of In­dus­trial Se­cu­ri­ties.

“Go­ing global and ex­tend­ing in­dus­trial chain be­come a rea­son­able choice for those am­bi­tious and fledg­ling com­pa­nies,” said Chen Jiao, chief agri­cul­tural an­a­lyst at In­dus­trial Se­cu­ri­ties.

What’s more, the Belt and Road ini­tia­tive worked as a spring­board for the Chi­nese com­pa­nies seek­ing to ex­pand into in­ter­na­tional mar­kets. Af­ter the ini­tia­tive was launched, Chi­nese com­pa­nies won the trust and re­spect from lo­cal part­ners in var­i­ous mar­kets out­side China, said Wang.

In 2014, Well­hope fi­nally went pub­lic. Jin de­ter­mined to go full steam ahead to re­al­ize his dream of mak­ing Well­hope a global leader.

But that was eas­ier said than done. The past few years saw the tide turn­ing against the in­ter­na­tional oper­a­tions of Chi­nese pri­vate and Sta­te­owned en­ter­prises. Only those helmed by a cap­tain with both fore­sight and a qual­i­fied crew suc­ceeded to weather the storm.

Jin is one such cap­tain. He re­ceived a PhD from Shenyang Agriculture Univer­sity. That’s ex­tra­or­di­nary be­cause agriculture was and re­mains the last choice as a ca­reer op­tion for most Chi­nese, given the hard work re­quired and low re­turns.

Few ed­u­cated peo­ple choose the feed in­dus­try as their field of en­deavor even though it was opened up to pri­vate and in­ter­na­tional busi­ness in the early 1980s.

“I take part in all over­seas ne­go­ti­a­tions be­cause the abil­ity to com­mu­ni­cate in a for­eign lan­guage is vital in any over­seas ne­go­ti­a­tion. It helps me find a po­ten­tial op­por­tu­nity, qual­i­fied lo­cal part­ners and judge the in­vest­ment en­vi­ron­ment,” said Jin. “And I be­lieve this is the key for the suc­cess of our in­ter­na­tional busi­ness.”

Be­sides Jin, six out of seven found­ing mem­bers of Well­hope hold doc­tor­ate de­grees, ef­fec­tively mak­ing it more of a tech­nol­ogy com­pany than one en­gaged in agriculture.

Ten years af­ter start­ing up, Jin chose to co­op­er­ate with De Heus, Hol­land’s largest feed com­pany, which helped im­prove com­pany’s tech­ni­cal level and also en­hanced its in­ter­na­tional way of think­ing and op­er­at­ing.

Zhang Xin, vice-pres­i­dent and hu­man re­sources man­ager of Well­hope, said the com­pany now hires only those who are versed in the English lan­guage. It also pro­vides weekly English classes and ad­min­is­ters an an­nual English lan­guage pro­fi­ciency test to its staff.

“Af­ter 30 years of de­vel­op­ment, Chi­nese feed com­pa­nies have built up ad­van­tage in terms of tech­nol­ogy, cap­i­tal, tal­ent and man­age­ment. It is time for them to set sail,” said Chen.

For the com­ing year, Wang said his new mis­sion is to make lead­ing com­pa­nies in var­i­ous lo­cal mar­kets out­side China Well­hope’s part­ners.

“The emerg­ing mar­kets look like nuts with a hard shell. But if you have a handy nut-cracker, you can en­joy the de­li­cious ker­nel.

South­east Asia, South Asia and East Africa are at the top of our agenda.” Jing Wei­dong, chair­man of Well­hope Agri-Tech the in­vest­ment that the com­pany will pour in a feed pro­duc­tion and pig breed­ing fa­cil­ity in Manila

PRO­VIDED TO CHINA DAILY

Jan Cor­tan­bach, CTO of Royal De Heus China, an in­vestor in Well­hope, in­spects one of its fa­cil­i­ties in March.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.