Archive for ‘Chinese State Council’

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26/10/2019

Merger of China’s shipbuilding giants gets the green light

  • After nearly 10 years of planning, the country’s two shipbuilders will be reunited with a combined revenue of US$141.5 billion
China’s two shipbuilding giants have built hundreds of military vessels over the past few years as the country’s navy seeks to modernise rapidly. Photo: Xinhua
China’s two shipbuilding giants have built hundreds of military vessels over the past few years as the country’s navy seeks to modernise rapidly. Photo: Xinhua

China on Friday announced the merger of the country’s two largest state-owned shipbuilding giants, a step Beijing has been preparing for nearly a decade to strengthen the competitiveness of its shipbuilding industry.

The intention to merge the Shanghai-based China State Shipbuilding Corp (CSSC) and the China Shipbuilding Industry Co (CSIC), based in Dalian, Northern Liaoning province, was announced in a statement on the website of the state-owned Assets Supervision and Administration Commission of the State Council, China’s cabinet.

The merger would enable China to establish a shipbuilding giant with a combined revenue up to 1 trillion yuan (US$141.5 billion), capable of building vessels ranging from warships, like aircraft carriers, to civilian ships such as container ships and oil tankers, said a source familiar with the merger plan.

“This merger has been in the making since Hu Wenming, a former party leader of the state-owned aviation industry, was assigned to CSSC as party secretary in 2010,” the source said, requesting anonymity because of the sensitivity of the issue.

“The merger plan was put on the drawing board at a time when the world shipping industry had entered a golden period in 2009, and the business of CSSC and CSIC was at its peak, but [China’s] analysis indicated a decline was on the horizon, as has actually happened in recent years.”
Chinese shipbuilder touts warships in push to expand arms sales in region

CSIC and CSSC were part of the same group until 1999 when they were split into two separate entities. Since then, China has overtaken South Korea and Japan to become the world’s largest builder of merchant ships, a rise spurred by the boom in world trade and the country’s accession to the World Trade Organisation in 2001.

CSSC manages shipbuilding business in the east and south of China, while CSIC oversees activities in the northern and western parts of the country. Both are also primary contractors for PLA naval ships.

Commercial shipbuilding was the major source of revenue for both enterprises, given they were generally less technologically challenging and of lower cost to build, the source said.

“Developing and building warships for the PLA needs more manpower and more advanced technologies because naval ships, which are built for sea battles, take longer to build and require cutting-edge technologies, hence the higher costs,” the source said.

China tests new warships in live-fire drills near Vietnam
CSSC and CSIC have built hundreds of military vessels over the past few years as the Chinese navy seeks to modernise rapidly. These have included aircraft carriers, Type 055 destroyers, Type 075 amphibious assault ships and Type 094A nuclear submarines.
But, the source said, the two giants’ naval warship building mission would be cut back next year, as Beijing expected greater financial pressure as a result of slower economic growth. The merger would allow the two companies to pool their resources and enhance their competitiveness, especially in the development of mega vessels.
But the source said the two giants’ naval warships building missions would be cut back beginning next year as Beijing foresees greater financial pressure as a result of slower economic growth. The merger will allow the two companies to pool their resources and enhance their competitiveness, especially in areas of mega vessels.
“The merger is also part of China’s long-term maritime energy development plan to meet President Xi Jinping’s sustainable and clean energy goal, because China needs more giant vessels to help ship oil and gas from other countries,” the source said.
Source: SCMP

Posted in aircraft carriers, Assets Supervision and Administration Commission, Beijing, China Shipbuilding Industry Co (CSIC), China State Shipbuilding Corp (CSSC), China’s, China’s cabinet, Chinese State Council, civilian ships, competitiveness, container ships, Dalian, giants, green light, industry, Japan, Liaoning province, merchant ships, Merger, military vessels, oil tankers, PLA naval ships, Shanghai, shipbuilding, shipbuilding giants, South Korea, Uncategorized, Vietnam, warships, World Trade Organisation (WTO) | Leave a Comment »

11/09/2019

China aims to become self-sufficient in pork production despite African swine fever

  • Agriculture ministry says long-term goal is achievable despite the loss of a third of domestic livestock owing to impact of disease
  • Observers believe foreign producers will never be able to produce enough to satisfy the world’s largest market for the meat
A pork vendor sleeps at a stall at a Beijing wholesale market. Photo: Simon Song
A pork vendor sleeps at a stall at a Beijing wholesale market. Photo: Simon Song

China will continue to strive for self-sufficiency in pork production although its farming industry has suffered a devastating blow after African swine fever wiped out about one-third of its hog herds, officials said on Wednesday.

Yu Kangzhen, a vice-minister for agriculture, said it was unrealistic for China to pin its hope on imports in meeting the country’s demand for pork.

Last year, China consumed about half of the world’s pork but more than 95 per cent was sourced from domestic supplies, which have taken a serious hit this year due to swine fever.

The disease is deadly for pigs, although not for humans, and there is currently no cure or vaccine.

“Even at its highest level, imports accounted for about 2 per cent of China’s domestic production,” said Yu at a press conference in Beijing.

“So from the statistics alone, we can see that we must adhere to the principle of self-sufficiency if we are to meet our demand for meat, and this also explains why we have put forward a 95 per cent self-sufficiency target.”

According to Yu, the total global trade in pork last year was 8 million tonnes – less than 15 per cent of China’s total production of 54 mi

Peng Shaozong, an official from the pricing department of the National Development and Reform Commission (NDRC), expressed confidence that foreign suppliers would be interested in filling any gaps in the Chinese market.

“Imports are guided by the market. If there is money to be made [in selling to China], they will definitely come,” said Peng on the sidelines of the press conference.

Pan Chenjun, from agribusiness bank Rabobank, said China’s pork production was expected to continue to fall in the coming year, putting pressure on the country’s US$140 billion pork industry.

In July, China’s pig population had fallen by 32.2 per cent from a year earlier, and was down 9.4 per cent compared with the previous month, according to latest government figures.

However, Pan said the government’s 95 per cent self-sufficiency target was in line with market realities.

China’s domestic pig stocks have fallen by a third. Photo: AP
China’s domestic pig stocks have fallen by a third. Photo: AP

“In any case, the 95 per cent [self-sufficiency] goal is reasonable, as China’s pork market size is too big, and imports, despite rising this year, still represent just a small part,” Pan said.

Although China’s domestic shortfall may offer a windfall to foreign suppliers, they must obtain government approval before they could sell to China.

On Monday, Beijing approved imports from 25 Brazilian meat factories, bringing the country’s total number to 89.

On Wednesday, Danish officials completed a three-day trip to China, saying they expected to increase pork exports to China.

Danish food minister Mogens Jensen attended the opening of a new meat processing facility near Shanghai operated by Danish Crown.

China imported 230,000 tonnes of pork from Denmark in 2018, according to the country’s foreign ministry.

On Tuesday, the Chinese State Council issued a new set of guidelines to support the industry, outlining measures such as increased subsidies to boost domestic production in the face of worsening pork shortages that have sent prices to record highs.

The consumer price index released on Tuesday reinforced the bleak picture of a tight market supply as the data showed that pork prices rose by 46.7 per cent in August compared with a year earlier, almost double the 27 per cent rise witnessed in July.

Prices of pork are one of the major indicators used by Chinese citizens to gauge their well-being and, at the moment, that well-being is being eroded rapidly.

According to NDRC, China has already spent a total of 3.23 billion yuan (US$454 million) in subsidies so far this year to tackle the pork shortage crisis.

“As much as 1.1 billion yuan has been newly added under the budget of the central government, with the focus on supporting western provinces in the Yangtze River basin to carry out farm improvement works to control pollution and reduce livestock and poultry waste,” Peng from the NDRC said.

However, a report published by research firm Gavekal Dragonomics on Wednesday cautioned that the government’s plans to soften the blow on the industry might not be effective.

“As the overhaul of pig-raising practices to eliminate the disease would take years even if the government was moving more aggressively, high prices and pork shortages are going to persist,” the report said.

Source: SCMP

Posted in African swine fever, agribusiness bank, Agriculture ministry, aims, Beijing, Brazilian, China alert, Chinese State Council, cure, Danish Crown, Danish food minister, Denmark, despite, devastating blow, farming industry, Gavekal Dragonomics, meat factories, meat processing facility, Mogens Jensen, National Development and Reform Commission (NDRC), pork production, pork vendor, Rabobank, self-sufficient, Shanghai, sleeps, stall, Uncategorized, Vaccine, vice-minister for agriculture, wholesale market, Yangtze River basin | Leave a Comment »

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