Chapter 346 Protracted War
At the end of June, spring rapeseed harvesting in major producing areas across the country has basically been completed.
At the beginning of July, it is the time for warehousing and processing.
The first increase in rapeseed revenue this year has driven down the prices of other raw materials.
Although the decline is limited, it also makes oil processing companies feel a lot better.
However, I was only happy for a moment, the price butcher Jiahe Cereals and Oils struck again!
Another 5% drop!
The entire industry is confused.
No one wanted to follow up, but after only two or three days, price-sensitive consumers voted.
The market share is being eroded little by little.
Arowana, Fulinmen, Luhua, Xiwang, Huifu, etc. almost followed up with tears in their eyes.
And small brands are already in collapse...
Jiuquan in July has entered the hot summer again.
However, the red flowers blooming in the Gobi Desert and the lush sea-buckthorn forest diluted the heat.
Jiahe’s group building is busy.
Several people were waiting inside and outside Guo Yang's office. In order to facilitate understanding of progress and decision-making, each major section was assigned separate secretaries.
“About 70% of the water-saving project in the Shule River Basin has been completed, the melting water from ice and snow has also entered its peak period, and the twin tower reservoirs are regularly releasing ecological water.”
“The drip irrigation plant is already under construction and will be completed by the end of the year. It will be put into operation."
"The Institute of Desertification and Desertification Control has also released its ecological management plan for the Dunhuang West Lake Wetland."
"Liu Xiang is in good health."
"Hexi Dairy's entire line of products is in place, and many new products have been launched this time."
"Cuscuta's impact on the North American alfalfa industry continues, and global high-quality forage prices have soared this year."
“The seed production contracts signed with farmers are expiring this year, and Mr. Yan means that they will not be renewed.”
Having just returned from other places, Guo Yang followed closely and listened to the work report all morning. .
Find and fill in gaps from clues.
For example, forage, the global market is booming now, but when the financial crisis breaks out, the global economy will be affected, and export trade will definitely be affected.
We also need to consider the consequences of terminating the contract with the seed farmers. In the future, Shahai Agriculture and Animal Husbandry will have to contact Zhangye to control desertification.
It was not until noon that I had time to rest for a while.
Take a sip of frozen carrot juice and milk, and your whole body will feel refreshed.
Just as he was about to go to dinner, the urgent phone rang again, and Gothe's voice came.
"Boss, this time I hit my opponent where it hurts. There are various reports on the market."
Guo Yang asked: "Is there CCTV?"
"There is only one text message. "
"Don't worry about it." After a pause, Guo Yang said: "How is the promotion of high-end edible oil brands?"
"The Nutrition and Health Institute is still studying. It won’t be launched until the end of the year at the earliest.”
Gaode thought for a while and said: "The current research and development direction is sunflower seed oil. Last year, Tianhe launched an oil sunflower variety with high levels of unsaturated fatty acids and vitamins, but it has not yet reached the harvest season."
“The other aspect is corn oil, which is also the focus of research and development.”
Price wars have enough temptations for consumers, and there are sufficient reasons for large companies that want to seize market share.
But this is a double-edged sword after all.
While embracing it passionately, you may also be stabbed in the back.
From the perspective of long-term interests, edible oil companies must escape the quagmire of price wars and use brand as a magic weapon for competition.
Strong products and marketing are the most powerful weapons.
There are not many such brands on the market at present.
Golden Arowana's dietary fatty acid balancing oil, Luhua's fragrant peanut oil...the others are very niche.
After thinking about it, Guo Yang thought that the current progress was not too slow.
In terms of grain and oil research and development, Jiahe is indeed a step behind, but the Nutrition and Health Research Institute with an investment of 1 billion yuan can make up for it.
In addition to oil sunflower, there will also be the trump card of gallnut oil in the future.
The important thing now is to get more market share.
After communicating with AutoNavi for a while about the layout of the third and fourth tier sinking markets, Guo Yang hung up the phone.
Then I went straight to the canteen to eat, took a nap, and then read the news about the grain and oil industry.
There are really mixed reviews.
But Guo Yang liked to see his opponents jump around, so he specifically looked for reports that criticized Jiahe Cereals and Oils.
The first is from Southern Metropolis Daily:
“Yesterday, following the previous two sharp price cuts, Jiahe Cereals and Oils launched a new round of price cuts.”
“A discerning person It can be seen that Jiahe Cereals and Oils uses the banner of expanding the market share of small-package brand oil and cracking down on bulk oil, but in fact it is in urgent need of a larger market share as support after expanding its production capacity.”
"Prices of branded edible oils have been reduced every year, but never as thoroughly, so urgently, and so recklessly as this time."
"However, can Jiahe Cereals and Oils, which is waging a price war, really get what it wants?"< br>
“Compared with Arowana, Fulinmen, Luhua and other established companies that have been deeply involved in the edible oil market for more than ten or twenty years, Jiahe Cereals and Oils is just a new force.”
“The three major The brand occupies an absolute market share.”
“Jiahe Cereals and Oils has no say in independent pricing and no ability to dominate the market.”
"Jiahe Cereals and Oils are making wedding dresses for others!"
"The three major brands are very willing to engage in price wars. Round after round of price wars will only push countless small brands into losses. "
"This will only increase the concentration of the industry and impose a high degree of control on edible oil prices in the future."
"The ecology of the domestic edible oil market will eventually be destroyed. It’s still the farmers and consumers who pay the bill.”
“The culprit is Jiahe.”
"It's time for industry authorities to take action."
After reading the entire article, Guo Yang only felt that this was not a roar, but full of lust and lust.
Are you screaming?
Why is it so uninteresting?
Guo Yang looked at other reports or interviews.
What is surprising is that the statements of several mainstream edible oil brands are completely contrary to those of Southern Metropolis Daily.
Luhua's Sun Dong said in an interview, "No, Luhua has never thought about a price war, but it will fight to the death."
Fang Hong of Fulinmen:< br>
“The current price, even Fulinmen’s industrial chain, has entered a serious loss range, which is not what we thought.”
Arowana: “I want to raise the price Come on.”
China Business News also expressed its opinion:
Currently grain and oil processing companies are facing a dilemma, losing money or losing market share.
No matter what choice you make, it is like cutting flesh with a dull knife.
Compared with the relatively mild attitude of big brands, small brands and some tabloids are full of aggression towards Jiahe Cereals and Oils.
“Unfortunately, we have stopped work and local residents have lost another reliable option.”
"While international grain and oil prices remain high, domestic edible oil prices have fallen to the bottom. This price inversion is extremely unreasonable."
"Big companies and big capital are greedy hyenas."
“Since hundreds of millions have been spent to reduce prices and attack small brands, why not just use the money to acquire small brands?”
Work hard.
Chairman Lu Hua’s words have become a famous saying circulating in the market.
Almost all businesses are suffering.
Boiled frog, some companies are on the verge of bankruptcy, but the ones that have suffered the biggest impact are companies that have long used imported soybeans as raw materials.
These businesses are usually close to the coast.
The cost of importing raw materials in the early stage was high. Because of the soybean crisis in the past few years, investment was concentrated on terminals, ports and overseas imports.
There are almost no purchasing channels for domestically produced soybeans and corn.
The losses in this wave of price cuts were also the most severe.
Two days later, Guo Baichun, chairman of Yangcheng Zhizhiyuan Oils and Fats Co., Ltd., expressed grief and anger in an interview.
“Jiahe Cereals and Oils is a company with no bottom line.” “Jiahe claims to serve farmers, but drastic price cuts without a bottom line will ultimately harm the interests of domestic farmers.”
There are not many such remarks.
Attacks against Jiahe Cereals and Oils can almost be seen in newspapers, television, and online new media.
Intensifying in coastal areas.
Jiahe Cereals and Oils did not pay much attention to this information and did not respond. Only the special promotion price tags in major supermarkets have always existed.
…
On this day, Yao Richang, the editor-in-chief of Farmers Daily, came to Jiahe headquarters.
"Dr. Guo, you are really hard to make an appointment with."
"Too busy." Guo Yang made freshly baked kenaf tea for Yao Richang, "I don't even know where I will appear next day. City."
"It seems that the public opinion in the past two days has not affected you." Yao Richang took a sip of tea and praised: "This tea is good, good for health."
"Let's go. At that time, I asked someone to put a few boxes in. "Then I would be disrespectful."
"Haha." Guo Yang laughed twice. It can be seen from Yao Richang's attitude that today's interview will be very gentle. After all, people are happy to see a price cut for cooking oil.
Faced with Yao Richang's question about when the price war will end, Guo Yang was also confident.
“Until imported soybeans lose the domestic market.”
“Can it be done?” Yao Richang was surprised, “The production cost of imported soybeans has always been lower.”
< br>"That's not necessarily true now." Guo Yang said calmly: "In terms of the degree of mechanization, the domestic cost is higher."
"But from the perspective of yield per unit area, domestically produced soybeans now have the cost advantage."
"In general, imported soybeans do not have an advantage over domestically produced soybeans, and this does not include freight costs."
Yao Richang asked: "Guo Baichun of Yangcheng Zhizhiyuan Oil Company said that Jiahe was harming the interests of farmers."
Guo Yang smiled contemptuously, "Editor-in-chief Yao has learned about this company Company? ”
“Want to hear the details”
Guo Yang said: "The raw materials used by this company are all imported soybeans, and so far it has not processed a single domestic soybean. Its partner is Louis Dreyfus."
"Such a situation is very common along the coast. Coastal processing There are very few domestic soybean companies.”
“Making farmers rich has always been Jiahe’s vision.”
“In fact, in addition to the production cost factor, the domestic soybean oil extraction rate has increased. The impact of factors such as the increase in land area and excess corn production”
“According to Tianhe’s survey, the domestic soybean planting area has increased significantly this year.”
“We won’t say that we will achieve complete self-sufficiency this year, but there is definitely no problem with being self-sufficient by more than 90%.”
“And domestically, including Fulinmen, Arowana, Luhua, Huifu, and a large number of grain and oil processing companies along the coast, due to After the reshuffle in the past few years, the habit of using imported soybeans is still maintained."
"If we continue to be content with the status quo, it will be harmful to the interests of farmers."
"This price. The battle is bound to come, and it is better to take the initiative than to respond passively."
Yao Richang left with satisfaction, and published the interview with Chairman Jiahe almost intact the next day.
Then CCTV also sent out a quick news.
The general idea is that domestic soybeans are regaining lost ground. The price war is not only brand cleansing, but also a clarion call for domestic soybeans to counterattack.
This caused a huge response in the grain and oil industry.
The authoritative industry media "Grain and Oil Market News", which has not spoken out for a long time, stood up for the first time and gave their judgment:
"In recent years, the growth of Jiahe Grain and Oil has alarmed many people. Being unprepared and unpredicted led to today’s panic.”
“When domestic soybeans are in turmoil, Jiahe Cereals and Oils has invested 6 billion yuan in a massive way. It is like a reckless man who is rampaging through mergers and acquisitions, building factories, expanding production capacity, setting up production area warehousing and logistics...”
“In With the huge price inversion between domestic soybeans and imported soybeans, grain and oil processing companies have embraced imported genetically modified soybeans.” Build the factory."
"Then Jiahe Cereals and Oils came"
"What did he do?"
"He purchased domestic soybeans at a reciprocal price. At the highest point, he lost 900 yuan per ton of domestic soybeans processed. The losses lasted for half a year."
"The planting area of domestic non-GMO soybeans was finally saved. Otherwise, The country will be flooded with various genetically modified soybean oils."
"Then Tiandou No. 1 began to be widely promoted in the Northeast and coastal saline-alkali lands, and the building was about to collapse."
"It arrived last year. This year, while Jiahe Cereals and Oils continues to expand its production capacity, it also invests heavily in further improving warehousing and logistics.”
“Jiahe Cereals and Oils is the first company to respond to the ‘four-dispersion’ transportation and is ahead of everyone else. .”
"Both Fulinmen and Arowana once said that they have the largest production capacity, the most complete industrial chain, the most abundant and smooth international procurement channels, and the lowest cost in the country."
"However, when Jiahe Jinmen Grain and Oil Comprehensive Base, Zhenjiang By the time large-scale grain and oil factories were put into operation, the situation had already changed. "
"Five years ago, multinational grain merchants took advantage of raw material production costs and capital to engage in price wars, eventually dominating domestic soybean trade and processing. ”
“Now, a fierce price war has struck again”
“The difference is that this is a counterattack from the domestic grain and oil upstarts”
"In addition, during the interview, Gao De, general manager of Jiahe Cereals and Oils, specifically emphasized the Jiahe Nutrition and Health Institute."
"Soon, Jiahe will launch healthy, natural, nutritious, and scarce high-end edible oils..."
Farmers Daily, CCTV Express, Grain and Oil Market Report... the successive characterizations have rapidly changed the reputation of Jiahe Grain and Oil.
The counterattack against multinational grain merchants, the final battle between domestic soybeans and imported soybeans...
The pain caused by the earthquake has not yet been eliminated, and the Olympic Games have not yet arrived.
A soybean without smoke or flames of war begins a thrilling journey.
After the "Grain and Oil Market News" report, some peer companies finally came forward to respond to Jiahe.
Xue Liqiang said in an interview: "Jiusan Grain and Oil will resolutely defend the position of domestically produced non-GMO soybeans."
However, Xue Liqiang was noncommittal about today's price war.
There are differences between people, and there are also gaps between companies.
Jiu San also suffered a lot from the loss.
But there is another person who is more painful.
Zhangjiagang, East China Sea Grain and Oil Terminal, is the largest comprehensive grain and oil processing base of National Grain.
Has an annual throughput of 3 million tons.
Even though it has continued to suffer losses in recent times, it still bites the bullet and imports soybeans from overseas.
However, with the upper management's determination and the nature of pursuing profits, Yu Bo, general manager of Guofang, had to adjust his strategy.
The number of calls at the East China Sea Grain and Oil Terminal began to decrease.
Domestic soybeans will have a bumper harvest in September. This year’s area and output far exceed last year’s, which will definitely have an impact on the market.
Because of such expectations, Fulinmen, Arowana, and Luhua will follow up the price war. This will make them uncomfortable, but small brands will feel even more uncomfortable.
However, the soybeans of the national grain have always been purchased through ADM, and the purchasing channels for domestic soybeans are not smooth.
Persistence or change?
Compared with national grains, Yihai Kerry general manager Fang Hong finally chose to import soybeans after asking chairman Guo Guangfeng for instructions.
Guo Guangfeng said this to Fang Hong:
"It is difficult to say which is the higher cost of Chinese and American soybeans. Yihai Kerry has advantages in overseas channels."
< br>“But in China, Jiahe has a certain degree of binding with soybean farmers through seeds, and we can’t compete.”
"The price war has to be fought, and it may even become a protracted war."
…
The outside world is turbulent, but Jiahe is calm.
Guo Yang didn't even pay much attention to the news trends in the past two days. Instead, he studied crude oil futures.
This is completely unfamiliar territory to him.
But the unreasonable rise makes today's trend look so moving.
Dong dong.
Gaode knocked on the door and walked in, "Boss, crude oil futures have just exceeded 140 US dollars per barrel."
Guo Yang was eager to try, "Then buy some?"
(End of this chapter)