Henan Dayong Bangjie Food Co has signed a deal with the local government of Xincheng county in Guangxi province for an RMB250 million investment in feedlots, processing plants and cold chain facilities. The firm will target the domestic market for packaged meat as well as the international halal market.
Located in the country’s deep south, Guangxi province is one of China’s poorest and most rural regions, but in recent years has become a magnet for meat companies forced to shift feedlots and plants from more wealthy regions that are cracking down on pollution. The new deal will see 10,000 “impoverished” families brought into the Bangjie scheme as farm hands and factory workers, explained Li Chao Hui, deputy secretary general of the local Communist Party office. Li said local government would “support the project with favourable policies”, but didn’t elaborate on what they were. Typically, such inducements include access to local land as well as low-cost rates for utilities like electricity.
Based in Zhoukou in China’s most populous province, Henan, Bangjie claims to produce 800 different types of beef, pork and poultry products. These include high-temperature meat sausages, a ‘Western-style’ sausage series and a ‘Chinese-Western’ range of low-temperature products. Bangjie has annual capacity to kill 60,000 cattle as well as 12 million head of chicken and (while the firm trades as a halal producer for beef and chicken) 300,000 pigs. However, a string of expansions will give the company capacity for a 200,000 annual cattle kill by 2017.
Meat snack packs
With an ambition to be the number one halal brand in China, Bangjie has branched out in China’s north (about 1,500km from the Guangxi site) with a large subsidiary producing sheep and cattle for the halal market. The firm claims to export to the Middle East and Russia.
Domestically, Bangjie targets the lower end of the market with packaged, dried tripe and cumin-flavoured beef cubes. These are sold in colourful packets in convenience stores and railway stations across China. Bangjie sells a 630g gift box of its ‘Bangjie Boy’ snack packets for RMB160. A new range of higher-end ready meals, meanwhile, sells for between RMB98 and RMB165 (for two meals) and features local favourites such as meat balls in a black bean sauce, as well as spicy tripe and spiced beef tendon.
A feature of Bangjie projects is the company’s keenness to work with local governments and financial institutions, using political support to secure favourable land and financial support in return for investment and jobs. Founded in 2008, Bangjie is well-connected, being one of the firms appointed to manage state meat reserves. The company has benefited from an impetus by Henan provincial officials to improve freezing and cold-chain capabilities in local food processors. Its huge population and location in China’s centre make Henan a launch pad for many major food brands who then spread nationally – a prime example being the country’s biggest pork processor Shuanghui/WH Group.
There is growing demand for beef in China and a shortage of local supply. China’s beef imports will jump 22% to 1.2 million tons in 2016, according to the US Department of Agriculture – that would represent a fourfold increase on 2012. Imports now account for 36% of demand.