Study of the features of livestock sector growth of the world market

Table of contents: The Kazakh-American Free University Academic Journal №4 - 2012

Konurbayeva Zhadyra, East Kazakhstan State Technical University in honor of D. Serikbayev, Kazakhstan
Zakimova Alfiya, East Kazakhstan State Technical University in honor of D. Serikbayev, Kazakhstan
Rakhimberdinova Madina, East Kazakhstan State Technical University in honor of D. Serikbayev, Kazakhstan

Agriculture is considered to be one of the major sectors of the global economy. It is aimed to provide population with foodstuff and to supply light and food processing industry with raw materials. That is the only sector of material production which depends upon natural conditions.

However, its significance in the economy of different countries and regions varies much. The geography of agriculture has an extraordinary diversity of forms of production and agrarian relations. All of them can be united in two groups:

- Commodity agriculture is characterized by high efficiency, intensive development, a high level of differentiation;

- Consumer agriculture is characterized by low efficiency, extensive development, and lack of differentiation.

Agriculture of developed countries is characterized by sharp predominance of commercial agriculture based on mechanization, chemicals, biotechnology, advanced selection methods. Agriculture in developing countries is plural and includes a traditional sector (mainly crop area with small farms) and a modern one (commodity agriculture with well-organized plantations and farms).

Livestock is a most important branch of agriculture providing population with high-protein and health food, and a number of industries with raw materials. Livestock industry provides 45% of total production, accumulates 75% of fixed production assets and 70% of manpower resources in agriculture, livestock value is also determined by the fact that it produces the most relevant and biologically valuable products in the human diet [1].

Livestock affords valuable raw materials for the industry: wool, leather, lambskin, etc. The development of livestock sector can make productive use of agricultural labor and material resources in the course of the year. Crop sector waste is used in livestock, valuable organic fertilizer such as manure and slurry are produced.

The main task in the livestock industry is to create proper conditions for manufacturing of products whose volume and quality conform to population size and nutritional standards and whose prices ensure profitability of their production and commensurability with the size of most people’s income. In the past the main objective was to get more products, however now the main criterion of the industry is to achieve competitiveness and breakeven.

Livestock as a branch of agriculture is developing almost worldwide. The deployment of its branches depends first of all on the food reserve.

The contrasts in the development of animal husbandry over the world between developed and developing countries are even more than those in farming.

Animal husbandry comprises the following subsectors:

- livestock (cattle-breeding);

- swine-breeding;

- sheep-breeding;

- poultry keeping;

- horse-breeding;

- deer farming;

- fur animal breeding;

- bee keeping.

Cattle, pigs, sheep and poultry are the main subsectors among them.

The significance of cattle-breeding (1.3 billion animals per year) is in providing almost all the milk and more than one third of meat. The largest total number of livestock abroad is in Asia and Latin America.

There are three main areas in cattle-breeding:

- Dairy cattle (characteristic of densely populated areas of Europe and North America);

- Meat and dairy cattle (characteristic of forest and forest-steppe zones);

- Meat cattle (characteristic of dry areas of temperate and subtropical zones). India, Argentina, Brazil, the USA, China, and Russia have the largest number of cattle.

Cattle-breeding is spread relatively evenly through the world but its levels of productivity and differentiation vary in different zones. Meat and dairy cattle are ranched in forest and steppe temperate zones. Dairy cattle prevail with stalled and mixed keeping of cattle in suburban and other highly-populated areas. In arid zones with migratory cattle-breeding meat cattle predominate. Most of the livestock population (almost 60%) is in developing countries.

Pig breeding is considered to be the most dynamic sector of the livestock (more than 0.8 million head per year). Advance in the development of this sector promoted the fact that pork became cheaper than beef. Pig breeding is available everywhere. In Muslim countries there are practically no pigs for religious reasons. This sector is close to densely populated areas and areas with intensive potato and sugar beet growing. Chine is the first country in the number of pigs (almost half of the world total) followed by the U.S., Russia, Germany, and Brazil.

Sheep farming is the third leading livestock industry, producing wool, astrakhan fur, sheepskin, meat, fat, and milk. This is one of the most traditional and extensive production in agriculture.

Sheep breeding (1.2 billion head per year) prevails in the countries and areas with extensive pastures. While fine-wooled sheep breeding is most often found in areas with an arid climate and in the steppe and semi-desert, semi fine-wooled sheep breeding, meat and wool sheep breeding prevail in areas with humid and mild climate. Steppe regions of Australia are the world's largest area of sheep breeding.

Sheep farming predominates in the countries and areas with extensive pastures. Several breeds of sheep are grown for different purposes. Australia and New Zealand have the largest number of sheep. Sheep breeding falls into meat and wool, wooly and fat-rumped sheep. Wooly sheep farming is subdivided into fine-wooled, semi fine-wooled and astrakhan. Fine-wooled farming developed in arid and semiarid regions (China, Argentina, Iran, and Uzbekistan) provides the highest quality fine-wool. Central and Western Asia are suppliers of valuable astrakhan (newborn sheep skins).

Goat breeding is close to sheep breeding. Generally it has local significance, except Angora goats breeding giving mohair.

Poultry farming is one of the most fast developing livestock industries. Highly mechanized poultry farms for eggs and poultry are located not far from cities and major grain producing areas.

Fishing is a very ancient craft of mankind. Currently it is an important sector of the world economy. In freshwater 0.1 of the world fish catch is fished out, the rest part is got in the oceans and seas.

Many countries develop fishery as a sector. But nearly half the world's fish catch is produced by six countries such as Japan, China, Russia, the USA, Chile, and Peru. The disastrous decline in industrial fish reserves in the ocean promotes fish farming development.

This means also fish farming and increasing and improving the quality of fish stocks in natural waters (various species of sturgeon, salmon, and herring), and in special artificial reservoirs (bream, carp, crucian carp, etc.). Japan has the most significant advances in fish farming and growing other seafood.

There are other narrow prominent sectors of livestock such as camel breeding, horse breeding, reindeer breeding, bombycid growing, rabbit breeding, bee keeping, and fur animal breeding.

The leaders of livestock production are economically developed countries; the USA, China and Russia are leading producers of meat, Russia, Germany, France are leading producers of butter, and the USA, India, Russia are the leaders of dairy industry.

The main exporters of livestock products are:

- Poultry – France, the USA, the Netherlands;

- Mutton – New Zealand, Australia, Great Britain;

- Pork - the Netherlands, Belgium, Denmark, Canada;

- Beef – Australia, Germany, France;

- Butter - the Netherlands, Finland, and Germany;

- Wool – Australia, New Zealand, Argentine [2].

China has an average of 58.8 pounds of meat per person, which is high even for the world average. According to the Ministry of Agriculture of China its livestock sector achieved a stable delivery of milk, meat and eggs to the domestic market for five years from 2005 to 2010.

In 2010 meat production was 78.5 tons, milk production was more than 37 tons, and egg production reached 28 tons. For five years, the growth performance of milk production was 31%, meat and eggs - 13%. China has 21 pounds of eggs per capita, which exceeds the relevant data of any developed country.

In 2010 the number of pig and dairy farms among agricultural enterprises of this sector was 66% and 47% respectively. These figures increased more than 20% in comparison with 2005.

Over the last five years from 2005 to 2010 no state has allocated so much money to maintain and expand existing pastures as China. During this time the area of pastures increased by more than half. Expanding the natural forage for livestock is a breakthrough [3].

Table 1 - Geographic segmentation by livestock exporting countries [2]

Livestock products and live cattle Main exporting countries
Beef and veal Australia, Germany, Finland, New Zealand, Ireland, the Netherlands, the USA, Hungary
Pork The Netherlands, Belgium, Denmark, Canada, Hungary
Mutton New Zealand, Australia, Great Britain
Poultry France, the USA, the Netherlands, Brazil
Wool Australia, New Zealand, Argentina, Uruguay, the Republic of South Africa
Cattle Brazil, Argentina, Mexico
Swine Ethiopia, China, the Netherlands, Canada
Sheep and goats Australia, Turkey, Somalia, Ethiopia

The Table clearly characterizes the international trade of livestock products. It describes the leading position of the mature economies in trade and these are the first-rate exporters of meat and wool products. The percentage of the developing countries is somewhat higher in live cattle trade.

Livestock is a secondary sector in the most developing countries while it dominates over farming and is notable for intensive farming in the most developed countries. Industrialization, food supply improvement and progress in selection work in the developed countries promoted higher productivity in their livestock sector. Because of the common problems of livestock and farming in the developed countries e.g. economic glut, the governments of these countries pursue the policy of containment and cutback in production.

Economically developed countries are far ahead in absolute indicators of developing livestock production. This is due to the lower productivity of livestock in Asia, Africa and Latin America. Suffice it to say that they produce only 25% of the world beef and 14% of milk.

Figure 1 – World dynamics of production by country for 2009 and 2010 (KZT million)

Per capita indicators of livestock products in the developed countries tend to be many times higher. Especially there are small countries with a highly intensive livestock sector (New Zealand, the Netherlands). But countries with smaller population such as Australia and with more extensive livestock might also have high per capita indicators.

Livestock is as widespread as crops, and grasslands and pastures occupy three times more land than agricultural land in the structure of land. The bulk of the country's livestock production comes from the temperate zone.

The geography of the world livestock is characterized by cattle placement.

Different countries have a diverse level of livestock sector development. In advanced developed countries e.g. Europe, North America, Japan, and former socialist countries with transition economy e.g. Central Europe and CIS countries, the livestock sector is a highly intensive and mechanized industry based on the same intensive and mechanized feed production. Its main subsectors are dairy cattle breeding, stalled breeding of cattle for meat, swine breeding, and highly mechanized poultry breeding.

The livestock in these countries is a highly marketable sector closely related to processing and value chain of agriculture. However, in the countries with large pastures, livestock combines features of extensive production (but well technically equipped) associated with the other components of the agricultural sector. Pastures are used to grow cattle for meat, and to breed sheep. This is a characteristic of South-West of the USA, Australia, New Zealand, South Africa, and to the less extent the South of Ukraine and Russia, Kazakhstan, etc.

An extensive livestock using grazing and very little related to other branches of the agriculture sector has been formed in developing countries. There are the most developed subsectors such as meat cattle, meat and dairy cattle breeding (with cattle less productive in comparison with Europe or the U.S.), grazing sheep, horse breeding in some areas, camel breeding, etc.

Among developing countries, the most total number of livestock for meat is in Latin America (Brazil, Argentina, Mexico, Uruguay) and East Africa (Ethiopia), of sheep and goats - in South West and South Asia (Iran, Turkey, India, Pakistan).

Developing countries are going to increase wool production volume in the near future. Kazakhstan, India, Russia, China, and Turkey don’t process the whole amount of wool up to now. Only streamlining the collection and classification of wool will promote the growth of the total production of wool.

Traditional leaders in wool production, however, will reduce the production of wool, as the market is saturated and overstocked with the products. Prices for the input wool are very low in the world market, and close to the price of production. Traditional leaders will cut down livestock population, and shift from wool to meat and dairy farming.

Land in Europe is constantly becoming more expensive, and requires the maintenance of sheep grazing, so the number of sheep and wool production in Europe will continue to decline.

Figure 2 - Forecast of production of pure wool, by country, 2009-2014 (KZT, thousand) Source: International Wool Textile Organization (I.W.T.O.)

Production of pure wool will increase stably in developing countries, where state supports its farmers and home processing of raw materials.

Wool production is also influenced by weather conditions. Weather affects more sheep than beef cattle. In recent years, unstable weather in Australia and South America also prompted breeders to reduce the number of sheep.

Large foreign buyers of wool, such as China and India, require large volumes of supply and prefer to work with traditional suppliers, New Zealand and Austr alia with established inexpensive marine logistics. European countries also prefer to work with reliable suppliers who provide carefully selected and processed wool.

The number of people in the world grows to about 70-80 million people a year. Never have so many people lived at the same time in the world. If you consider agriculture and food, everyone tends to increase consuming, and therefore relative consuming increases together with absolute consuming due to population upsurge.

Figure 3 - Forecast of pure wool exports, by country, 2009-2014 (KZT, thousand)

Source: United Nations Statistical Division

Accordingly, more food will need to be produced by the same amount of land (or even by a smaller area) in the XXI century worldwide. Recent studies of future demand indicate that the world will have needed 70-100% more food by 2050.

When asked “What should be done to provide 10 billion food?” Ida Kubiszewski, professor at the University of Portland, the editor of The Solutions journal replied that there is absolutely enough food supply in the world today but about 30 to 50% of food in both developed and developing countries is wasted, though for very different reasons.

In developing countries, the loss is mainly due to the lack of infrastructure in the production chain, such as storage technology of food produced by farms, during transporting, storage prior to sale. Huge losses during storage are typical for developing countries, such as India, where 35-40% of fresh produce is lost because neither wholesale stores nor retail outlets are equipped with refrigerators.

Though rice can be stored without any special equipment there are its losses in South East Asia. So after harvest about a third of the crop is going to be lost due to pests and spoiling.

In developed countries, the food losses up to the retail stage are much lower, but the losses during retail trade, public catering and individual consumption are significant. For example, consumers are used to buying good looking products and, consequently, retailers have to throw a lot of edible, but slightly damaged products. For consumers in developed countries food is relatively cheap, which also promotes producing waste.

The world faces a triple problem in the XXI century from the point of view of world food security:

a) to satisfy growing demand for food;

b) to ensure sustainable food security in terms of the environment;

c) to cope with the problem of hunger.


1. http://be5. biz/ ekonomika1/ r2011/ 1298. htm

2. http://www. grandars. ru/ shkola/ geografiya/ zhivotnovodstvo. Html


Table of contents: The Kazakh-American Free University Academic Journal №4 - 2012

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