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Chinese Pig Farmers Help Struggling Dairy Sector

16 January 2015, at 11:28am

CHINA - In the rural areas of north China's Hebei Province, local farmers have started feeding pigs fresh cow's milk in order to try and support local dairy farmers, whose milk prices have slumped.

Plummeting milk prices have fueled a rush among local farmers to sell milk at extremely low prices, however possible, including selling to local pig farmers.

To recover their costs, some dairy farmers are feeding the milk to calves, or simply throwing out the nutritious liquid. Some have even killed their cows to prevent further losses.

The downturn has come as a surprise to many. In late 2013, China's dairy products saw a price hike following a production decrease caused by disease and individual farmers leaving the industry. Milk prices jumped to more than 5.0 yuan (80 US cents) per kilogram in December 2013 from 3.4 yuan per kg a year earlier.

The dairy boom sent ripples of excitement through the sector, with farmers purchasing large numbers of dairy cows at high prices to boost production.

But the boom proved to be a flash in the pan. In March 2014, international milk prices began to fall drastically due to overproduction. Many dairy companies resorted to cheap overseas sources and limited purchases from domestic suppliers, causing dairy prices to dip to new lows.

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