Chapter 339 - 167: Layout and Stalemate

Chapter 339: Chapter 167: Layout and Stalemate

The cost was reduced by a full 0.52 yuan.

And this was with Hailufeng Company’s industrial chain not yet fully established. The concentrated feed, which requires soybean meal and corn, costs approximately 2.5 yuan per kilogram.

In other words, of the total feed cost per kilogram of raw milk, concentrated feed accounted for 0.76 yuan.

But once Hailufeng Company’s Monan Branch completes its soybean industry layout, the cost of soybean meal will drop significantly.

That would make it possible to lower the feed cost per kilogram to around 0.6 yuan.

This was the chain reaction of an integrated industrial chain.

What’s more, Jiang Miao hadn’t even begun to focus on feed formulas or cow breeding. If he were to tackle both of these areas and increase the milk yield per unit of feed, the cost could be reduced even further.

The fundamental reason for the high price of domestic dairy products is the insufficient supply of local feed. Large quantities of imports are needed to fill the demand gap, which further drives up production costs.

For example, many pastures in the southern regions have to purchase hay from outside sources. Coupled with the fact that soybean meal is also an indirectly imported raw material, this results in costs for both concentrated feed and roughage being much higher than in other countries.

Furthermore, the lower milk-producing capacity of domestic cow breeds also contributes to higher costs.

The few regions that do have access to low-cost roughage—like Monan, the Western Regions, and the Northeast Region—are located far from the country’s core consumer markets. The cost of land transport simply can’t compete with the cost of sea freight.

Transporting milk powder or roughage from Monan to the Yangtze River Basin or the Pearl River Basin costs more than importing it from New Zealand or Australia.

This was the larger context behind the persistently high prices of domestic dairy products.

Without a fundamental change in the industrial layout, there was no way to bring down the price of dairy products.

...

After chatting for over an hour, Jiang Miao decided not to stay at the Phoenix Town branch office. Instead, he had Liu Changqing take him to tour the nearby farms, ranches, and factories.

Their first stop was the Phoenix Town honey processing plant, located just south of Phoenix Town and west of Luling Huateng Vocational School.

When the factory director heard the big boss was visiting, he grew nervous. He quickly told his subordinates not to mess anything up and hurried out to greet them.

"Boss."

"Jiahe, how are you settling in?"

Tian Jiahe scratched his head shyly. "I’m settling in, but the food in Gannan is so spicy. A few of my colleagues and I can only eat at the factory cafeteria."

For people from the Lingnan Region, Gannan cuisine was indeed incredibly spicy.

Liu Changqing prompted him, "Factory Director Tian, why don’t you give the boss an overview of the plant!"

"Of course." Tian Jiahe snapped back to the present. "Boss, this plant covers an area of 350 mu. We currently have three steel-frame factory buildings, taking up 150 mu of that, and the other support facilities account for another 50 mu."

They walked into the factory area.

They could see several tanker trucks designed for transporting honey. Workers were operating pumping equipment, transferring raw honey from the trucks into massive storage vats.

Next, the group entered the honey processing building. From an internal corridor, they could watch the production line running at full speed through large glass windows.

"Is the honey selling well?"

Liu Changqing nodded. "It’s doing okay. We mainly process and package the honey before supplying it to distributors across the country. We don’t do much direct retail yet."

Supplying other factories wasn’t really an option. Few domestic manufacturers used honey as a raw material, opting instead for things like high-fructose corn syrup. After all, corn syrup costs less than a tenth of what honey does. Only a fool would use honey as an ingredient.

Thus, the domestic honey market primarily catered to individual consumers and high-end establishments like fine dining restaurants, pastry shops, and tea houses. Very few factories purchased honey.

They arrived at the warehouse area.

Tian Jiahe sliced open a packing box with a utility knife. Jiang Miao casually picked up a 100-gram glass jar of honey. It was Purple Alfalfa honey that had yet to crystallize, with a thick, glossy texture and a pale lavender hue.

He twisted off the cap and tore away the foil seal. He poured a small amount of the viscous Purple Alfalfa honey into the cap, then dipped his finger in to taste it.

It had the characteristic natural fragrance of Purple Alfalfa blossoms. The taste was sweet and pleasant, with a subtle, faint tartness. The aftertaste was crisp and clean, with the scent of alfalfa flowers and a hint of clover.

Through his identification panel, Jiang Miao saw that this Purple Alfalfa honey had a Baumé degree of around 42. He also saw its composition: 57% Purple Alfalfa honey, 28% White Clover honey, 12% Ryegrass honey, and 3% other wildflower honeys.

"Not bad." Jiang Miao screwed the cap back on tightly and handed the jar to Li Zixuan to hold.

Tian Jiahe breathed a silent sigh of relief. "Boss, shall we go see the other products?"

"Other products?"

Tian Jiahe explained, "Propolis and beeswax. They’re byproducts of the raw honey concentration process."

Hearing the words "propolis" and "beeswax," Jiang Miao quickly searched his memory for related information. He asked calmly, "How do you process the propolis and beeswax?"

Tian Jiahe quickly replied, "Right now, we can only sell it wholesale as a raw material to companies that need it. This plant produces about five to six tons of beeswax and 200 to 300 kilograms of propolis each month."

At his words, Jiang Miao’s eyes flickered with thought.

After a moment, he looked at Liu Changqing and Tian Jiahe. "For now, keep handling the propolis and beeswax as you are. I’ll figure out a way to develop other uses for them in the future."