Expansion on Bayer menu as livestock farming grows

The formation of the Asean single market in 2015 is expected to encourage livestock farmers to upgrade and harmonise standards in an attempt to export higher-quality meat to global markets, according to Bayer HealthCare.

Meat consumers in Asean are increasingly unlikely to accept the low-standard meat products, said Dr Ernst Bottcher, the company’s general manager for Thailand, Indonesia and Malaysia.

Market integration under the Asean Economic Community (AEC) will allow more intraregional trading of pork, beef, poultry and fishery products, so farmers are actively investing to lift production standards.

“Some countries are preparing to increase their meat exports, while consumers will ask for an equal standard for the production process,” said Dr Bottcher. “There will be more investment for this objective from animal farmers and manufacturers who produce animal health products.

“Lifting the standard cannot be achieved by the investment from one company, but from all.”

Bayer HealthCare has manufacturing facilities in South Korea, Vietnam and New Zealand. Among the countries for which Dr Bottcher is responsible, Thailand is the largest market for Bayer HealthCare, and the livestock farm standards in this country are the highest.

Malaysia has been catching up to Thailand after the government a few years ago tightened law enforcement in order to force processors to produce meat products with higher standards to improve the country’s export prospects.

Indonesia is the largest meat consumer in Asean by virtue of its large population, but most livestock farms are “backyard style” and farmers have low awareness of international standards. All production in the country is needed to serve domestic demand and since no meat is exported, improving production processes does not seem to have a high priority.

Dr Bottcher said Southeast Asia was a growing market for animal health products because of rising populations and incomes, as well as consumers’ requirements for higher-standard foods. Sales in this region are expanding faster than in the company’s bigger markets in the United States and Europe, where demand is stable.

As Southeast Asian livestock operations expand to increase their share of exports, their main competition is from South America, according to Dr Bottcher. Thailand and Brazil, for example, are major rivals in the world poultry market.

Tourism is also a significant driver of meat production and consumption for Thailand, which welcomed more than 19 million foreign visitors last year. Meat exports are also on the rise now that the EU has lifted its ban on raw poultry, imposed in 2004 at the start of the bird flu outbreak. Poultry exports from Thailand this year are expected to grow by 9% from 2011, helped by an estimated 50,000 tonnes of raw chicken meat to be exported to the EU.

Poultry and aquaculture products, chiefly shrimp, represent 18.8% of Thailand’s total agricultural exports, according to data from the National Food Institute.

In recognition of the growth potential of the region, Bayer HealthCare has moved its office for Asia Pacific to Singapore. In 2010, it bought the New Zealand-based Bomac Group and built an innovation and development centre, aimed at developing products to serve the specific needs of Asia Pacific.

“Because of the rising trend in Southeast Asia, Bayer HealthCare has a target to grow higher than the market growth rate,” said Dr Bottcher. “A higher percentage of Bayer HealthCare’s investment is going to this region. We’re working closely with animal farmers in order to support them to do farming at a high and acceptable standard.”

Sourced: bangkokpost