China Closed 26% of Slaughterhouses

Authorities in China closed 26 percent of hog slaughterhouses last year, according to a teleconference held by 9 different government departments on January 17, 2013. Each locality was required to check up on the qualifications of hog slaughter facilities from December 2011 through November 2012 and over 5000 were closed. This blog has been reporting on this campaign over the past year (see posts from January and July 2012)

According to the announcement, the number of slaughter facilities was reduced from 19,938 to 14,720, a 26.2-percent reduction. Most of the closed slaughter facilities were small ones, which were reduced in number from 14,019 to 10,135, a reduction of 27.7 percent. The number of "designated hog slaughter facilities" also was reduced from 5,919 to 4,585, a reduction of 22.5 percent.

The objective was to speed up the consolidation of the sector by eliminating slaughter facilities with outdated equipment, reducing excess capacity and address chronic food safety concerns in the pork sector. The conference discussing the campaign acknowledged that progress in assuring the quality and safety is not achieved easily and reminded everyone that upgrading meat slaughter facilities is a long-term task.

Many counties have posted reports and decrees about their work on the campaign. An October 2012 report from Fei County in Shandong says officials began organizing inspections of the county's 22 designated slaughterhouses in March. They found many of the small ones lacked proper equipment and facilities and plans were made to refurbish 12 of them, including 2 newly-built facilities. A long list of equipment was purchased: offices, holding barns, 4780 square meters of concrete, 300 meters of hanging rails, 26 mechanical hoists, 5 shaver/dryers, 13 splitting saws, an incinerator for disposing of carcasses, posters and lists of regulations to hang on walls, and improvements in quarantine and inspection record-keeping. All this was accomplished by raising 2.9 million yuan (about $460,000). In October, officials approved 13 slaughter facilities for continued operation.

A 2010 report reveals that Fei County officials have been trying to address food safety problems in hog slaughter for a number of years. The big problems were pumping water into hogs before they are slaughtered,  selling meat from dead or sick animals and spent sows, and unlicensed, un-inspected butchers.

The Fei County report expressed frustration over the problem of pumping water into pigs. They set up "strict checks" for this behavior but noted that it is hard to gain control. At the time, most slaughter facilities lacked equipment to test for this. Slaughter facilities were asked to put up a bond at the beginning of the year. If they were caught pumping water into pigs, fines would be deducted. If they had no violations they would get the funds back at the end of the year, plus an award.

The county also was concerned about the frequent sale of meat from sick and dead pigs, especially on the outskirts of the city. The county set up a complaint system that included a telephone hot line for reporting illegal butchers and sale of bad meat. Calls were kept confidential and callers could get cash rewards if their complaints were verified. They got 5 calls, of which 4 were verified and they had records of 11 other complaints. Officials raided four illegal butchers and stopped the sale of 300 kg of diseased meat.

Slaughterhouses were required to keep records on inspections, certificates and sick pigs. Most facilities did not have adequate facilities to dispose of diseased carcasses and used "simple" methods (if they didn't sell the meat). In early 2010 the county brought in a set of disposal equipment and six facilities had proper equipment.

The experience of a town in Guangdong Province's Mei County in 2009 illustrates why it is so challenging to impose "safe" supply chains that eliminate the vicious competition that characterizes rural China.

Chengdong Town had about 30 pork dealers who rode motorcycles out to villages, collected pigs, had them slaughtered, and sold the pork. They bought pigs at 6.2 yuan/500g and sold the pork at 12 yuan/500g, making 150-250 yuan per day.

Then one day a notice appeared on an alley wall announcing that the town was building a new slaughterhouse that would be operated by a boss from somewhere else. Within a month the slaughterhouse was built and opened. Only pork from this slaughterhouse would be permitted for sale in the town. Traders would not be allowed to buy pigs from farmers on their own, nor could they buy pork elsewhere and sell it in the town.

One of the traders, Old Zhang, was puzzled by these regulations but he had to make a living. He and other traders hopped on their motorcycles and went to the gate of the new slaughterhouse to buy pork. They were surprised to find that the slaughterhouse had raised the price to 7.5 yuan/500g. The price was 1.2 yuan higher than before and Old Zhang spent an extra 130 yuan daily on his purchases. "Under pressure from the local government," Mr. Zhang had no choice but to buy the more expensive pork.

The slaughterhouse kept raising the price--it went up 35 percent by the end of the year. In the villages where they sold the pork, incomes were limited and the vendors claim they couldn't raise the price enough to pass on the higher cost of pork. Daily earnings by pork vendors fell to 30-80 yuan daily from the previous 150-250 yuan. The slaughterhouse also reduced the price they paid for pigs, from 6.2-6.5 yuan to 5.4-5.6 yuan/500g.

In May 2009, the Chengdong town government allowed vendors to buy pigs from farmers and have them slaughtered at the designated slaughterhouse for a fee of 15 yuan. However, as Old Zhang prepared to start buying pigs the town government announced that only 4 people would be allowed to conduct this business.

The frustrated pork vendors in Chengdong went on strike, but they could only hold out two days without income. Mr. Zhang appealed to the local news media. Officials explained that regulations required this arrangement, but Mr. Zhang described it as a "regional monopoly" that would have a "chain reaction" with the slaughterhouse taking all the profit.

"Ultimately rural people will have to either eat high-priced pork or not eat pork," said Old Zhang.

After reading a story like this, it's easier to see why illegal butchers and meat trade might spring up. There is money to be saved, profits to be made, and the participants might even feel like they're "sticking it to the man."