Meat products with high added value will be the development direction of the industry.

Over the past year, pig prices have risen by nearly 80%, and the performance of listed meat companies in the first half of this year has been "ice and fire." Through the upgrading of product structure, the production of high-end low-temperature meat with relatively high added value has become a magic weapon for enterprises to improve profits. Chen Wei, executive vice president and secretary general of the China Meat Association, said a few days ago that high-end meat products have high added value, but less than 17% of China's meat is now used for processed meat products, following changes in consumer demand. At present, the meat industry is accelerating the transformation and upgrading of product supply structure, and strive to increase this proportion to more than 25% by the end of the 13th five-year Plan period.

The benefits of adjusting the product structure and increasing the output of high value-added products have brought returns to enterprises. The data released by Shuanghui Development (hereinafter referred to as Shuanghui) recently showed that during the reporting period, Shuanghui achieved an operating income of 25.527 billion yuan, an increase of 25.41% over the same period last year, and a net profit of 2.151 billion yuan, an increase of 8.51% over the same period last year.

When analyzing its core competitiveness in the semi-annual report, Shuanghui said that in the first half of this year, through structural adjustment and network expansion, the output of cold meat and low-temperature meat products was ahead of its major competitors in the industry. the proportion of cold meat and low-temperature meat products in similar products is also better than that of major competitors in the industry, and the advantages of the output and structure of these high value-added products will significantly enhance the company's profitability.

Zhongyuan Research News analysis believes that the income growth of Shuanghui in the first half of the year benefited from the improvement of product structure, and the introduction of new products improved the aging situation of the company's product structure and enhanced its profitability. In the first half of the year, Shuanghui launched a series of high-end products such as garlic sausage and bacon, accounting for 10.5% of the company's product sales, up nearly 2% from the same period last year. Zhongyuan Research News predicts that with the market promotion, the start-up rate of new products in Shuanghui is expected to reach 50% in the second half of the year.

At present, the market share of Shuanghui meat products in Shangchao channel continues to rise, reaching 38.4% as of June 30. Soochow Securities analysis believes that the meat industry presents a single oligarch pattern, Shuanghui meat products supermarket share increased to 38.4%, a dominant. Structural upgrading, new products, profits are expected to be carefree in the second half of the year.

After the parent company Wanzhou International Co., Ltd. (hereinafter referred to as WH International) acquired the American meat company Smithfield, Shuanghui, as a subsidiary, has become the biggest beneficiary, and major changes have taken place in its business strategy and product structure. In 2016, Shuanghui put forward the strategic guiding ideology of "innovative transformation and creating the future" and the management policy of "stabilizing high temperature and upper low temperature", vigorously promoting product structure adjustment and transformation and upgrading.

Shuanghui's strategy in product structure is "stable high temperature, high temperature and low temperature, push western style". At the end of last year, Zhengzhou Shuanghui American factory put into production, Smithfield bacon, ham, sausage three categories of products officially on the market, this is Shuanghui introduced the world brand Smithfield and the use of advanced technology and equipment in Europe and the United States, the use of high-quality imported pork raw materials to produce high-quality low-temperature meat products, but also Shuanghui structure adjustment, promote transformation, meet the consumption upgrading of the main new products. In order to overcome the criticism of aging product structure, Shuanghui's R & D center has expanded from one in the past to eight at present, speeding up R & D and looking for new products and growth points.

Chen Wei said that at present, the overall development of processed meat products in China is relatively slow, with less than 17% of the meat used for processing meat products, while such data in developed countries are mostly 80% and 90%. The existing gap shows that there is a huge space for the development of meat processing products in China, which is the general direction of the future development of the industry.

In Chen Wei's view, the current consumption environment has changed, and more and more Western-style products have entered the homes of ordinary people, and it is the right time to adapt to the supply-side reform, the transformation and upgrading of meat processing products. The product concept of "western-style technology of Chinese products" and "Chinese-style flavor of western-style products" put forward by the industry more than 20 years ago is no longer in line with the market demand, and the original "western-style flavor of western-style products" has a certain market basis. it also meets the diversified consumer demand. In addition, consumers pay more and more attention to food safety and healthy diet, low-temperature meat products will have better development prospects.

Chen Wei also said that meat processing products have higher profits and more room for development, which will be the general direction of the development of the meat industry in the future. By the end of the 13th five-year Plan period, we will strive to increase the proportion of processed meat products in China's total meat output from 17 percent to more than 25 percent.

Guo Lijun, executive vice president and chief financial officer of Wanzhou International, previously said that the operating profit margin of the company's meat products in the first half of the year was 22%. It is expected that the future launch of new products will improve the operating profit margin, and the target level of operating profit margin in the future will not be less than 20%.

In order to spread Chinese and Western food culture, promote the integration of Chinese and Western food, and promote the upgrading of China's meat industry, Shuanghui actively teaches product recipes and cooking methods to consumers while ploughing sales channels to promote new products. On September 12th, "good things become double Mid-Autumn Festival Food Fair-Smithfield Pure American Taste Fair" will be held in Beijing, where many Chinese and Western dishes such as caramel bacon made with American products will be presented, demonstrating Shuanghui's business advantages after internationalization, the strong strength of technological research and development, and the determination and thinking of product innovation and marketing innovation.