China’s growing dairy sector sees forage demand rise

The oft-ignored offshore forage market is getting bigger, even while some traditional markets are getting smaller, says the head of the U.S. forage exporters’ organization.

“2016 registered the first time the Chinese market (was) a bigger export market than Japan,” John Szczepanski of the U.S. Forage Export Council said during the Canadian Forage and Grassland Association’s annual meeting in Winnipeg Nov. 16.

“We’re seeing very world class equipment and facilities (being built in China) that demand similarly high quality input. That has created for us a great market.”

Szczepanski said U.S. forage exports now total US$1 to $1.2 billion per year, with Japan and South Korea usually making up more than 50 percent of the market.

In 2016, not only did China become a larger volume market than Japan, but Japan and South Korea dropped to less than 50 percent of the overall market for the first time.

Szczepanski said the changing dynamics of the market come from the increase in Chinese demand, a gentle decline of Japan and South Korea and shifting demand in the Middle East.

China’s growth is all about booming consumer demand and the desire of Chinese consumers for high-quality, safe dairy products, he said.

The Chinese government has embraced the idea of high-quality alfalfa as the basis for high-quality dairy products, so until the country can produce enough of its own alfalfa, its dairy farmers are being pushed to buy good offshore alfalfa.

Szczepanski said the Chinese market is hard to work with be-cause of both complex regulations and multiple differing interpretations of regulations in different areas. However, it is an excellent long-term market for American forage exports.

Japan and South Korea are declining in demand because of an aging population and, in Japan, a shrinking number of dairy farmers. Fewer consumers and farmers mean less demand for forages.

However, Japan is the top-paying customer for the U.S. industry, so it is still a key focus of exporters, Szczepanski said. Not only does it pay top dollar, but it’s farmers know how to use a wide variety of forages rather than just alfalfa.

“For any forage that we grow in the western United States, alfalfa might represent 50 percent of our exports to Japan, but whatever we grow, the Japanese have a place for it.”

Szczepanski said Middle Eastern demand has shifted in recent years as the United Arab Emirates became a less dependable market. However, the Saudi Arabian market is seen to offer growing long-term potential, especially with challenges to irrigation.

The Saudis are also willing to pay for quality forages.

“The dairy industry there matters,” said Szczepanski.

The biggest challenge to the growth of the American export forage industry is transportation, he said. The bankruptcy of a major world shipping company recently rattled overseas buyers.

“When Hanjin shut off, it impacted a lot of product that was sitting on the water,” said Szczepanski.

“Having a transportation network that works is critical for us.… Where we don’t have reliable supply, best in the world doesn’t mean anything.”

Szczepanski also said being “best in the world” doesn’t always mean having the best product or marketing strategy.

“Our customer base is not asking for the best in the world,” he said.

“They are asking for good product at a reasonable price. Trying to tell people that we’re the best in the world only goes so far.”

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  • old grouchy

    Reading between the lines the demand is for quality forages purchased as cheaply as possible. Sorry – – – the very old example is that you can have good, fast and cheap but you can only have TWO at a time. Somehow now everyone seems to expect all three. Oh well – – – you just aren’t going to get it!

    • Harold

      As good has no comparison, and fast has no measure, and cheap has no meaning, where is it written that you cannot have all three? I’d like to get it.

  • Denise

    I’m sure China is smart and will not to be talked into buying cheap quality GM alfalfa. Let’s hope so, or next thing you Canada will be growing GM alfalfa which will be the end of the very best and nutient- rich alfalfa grown, in North America. GM alfalfa will spread like a weed and take over the organic alfalfa crops.
    The alfalfa we have now produces amazingly bountiful crops (3 crops a year in normal growing conditions!) and restores richness the soil. It is very healthy for the cows digestive tracts. It would be a terrible tragedy to lose it.
    The US will try to convince China that it’s great stuff( GM alfalfa) for their dairy cattle, even though they know it’s not.

    • Happy Farmer

      Please show the proof that GM alfalfa is poorer quality than regular alfalfa. Please show proof that GM alfalfa will produce less than regular alfalfa. Note- I am not for or against GM alfalfa at this point. Just would like to see good proof to your claims.

      • Denise

        Here is a good starting point to get information.
        Forage International is trying to make inroads into Canada with Gm alfalfa. They are so seductive in their methods to release this alien crop into our fields. Why on earth would we ruin a perfectly productive and healthy form of feed and replace it with GM alfalfa that can be sprayed with pesticides.
        The alfalfa we have now, needs no spraying with pesticides and produces the most nutritious feed with no digestion problems for the cattle. Beware the trojan horse built by Forage International bearing gifts of GM alfalfa in Canada. Once it’s spread around you are stuck with it.

        • Happy Farmer

          So, I checked out the cban site. I cannot see any verification there as to lower nutritional or yield qualities of GM alfalfa. If you want to say there is going to be cross pollinatiwith other alfalfa I will agree with you. But please don’t keep repeating the (false) fact that GM plants and foods are lower in nutrition and yields.

          • Harold

            You have not completed your examination. From plant science you go to environmental science and then to Food science and then Human heath science. One statement does not encompass all sciences. A healthy GM plant and it’s yield, are not of it’s self the definition’s of nutrition, or of a healthy human being.

          • Denise

            There’s a chance that GM plants could have the necessary nutrients to sustain good health in people and animals but once you have crossed over the line,and sprayed it with Roundup, I don’t think so.
            Roundup Ready Alfalfa? Does it make sense? Can we let common sense prevail, for just once? We don’t need it.
            So I gather you are keen on lining the pockets of Monsanto and their enablers with:
            -patented seed control of RR Alfalfa
            -costs 2X as much for seed
            – Monsanto and buddies will make tons of money from pesticide sales.
            – remember markets overseas, like Japan, don’t want RR Alfalfa. What are you going to do with it? I guess American cattle will ,once again, have to bear the burden of another experiment.
            – there have been NO long term studies done to prove it is worthy of consideration and,we know, it is not safe to let loose in the environment,as it will overtake organic and conventional alfalfa.

          • Happy Farmer

            Can we let common sense prevail? Yes, if it has been derived from facts.
            Do I want to line Monsanto’s pockets. Not really, but as a farmer I realize that it does not matter what I buy I’m always lining someone else’s pocket before my own.
            Can you name any food, feed or plant products that have been studied long term? Any that have been under the same scrutiny as GM products? I will concede that many foods and plants have been around for years, but have they been “studied” with the same vigor as GM products.
            Just because a product may crossbreed with another does not make it a unsafe for people or the environment.

          • Harold

            Monsanto is a closed shop for which no one can claim that GM products have been studied with “rigor” or scrutiny. Further, all of the GM seeds are patented and therefore intellectually owned by the producer for profit. This should cause great alarm in contrast to original seed non-patent. Are seeds patented for the good of man kind? Remove the Patent and truth will appear.
            Monsanto can sue a farmer for crops that his seeds have contaminated, moreover, motivated by patent and profit. Is a farmer safe? Is science intended for this purpose?
            Perhaps you have forgotten what happened when crossbreeding contamination occurred with a killer bee. A bee is an Organic, it’s just not a plant, but nonetheless, it a created with modification by technology.

      • Denise

        You can google: GM-Alfalfa-in-Canada-Update-and-Background-April-5-2016

  • richard

    So we drench the entire plant with a systemic, antibiotic and a mineral chelator to be fed to… ruminants?….. whose entire physiology is dependent on…… healthy gut biome?…. YIKES!……..Alfalfa is called the “king of legumes” because it is the most competitive forage legume on the planet… doesnt need roundup!…..unless of course you need to bilk a few more yuan out of a decadent stand that should have been plowed up last year???

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