Ding Lei brings home bacon

Internet entrepreneur has ambitions to revolutionise pig farming

Ding Lei brings home bacon

Pondering how to clean up China’s food industry: Ding Lei

It’s been two years in the making, but Ding Lei’s ambitions for perfect profits with pork finally seem to be getting off the ground.

The billionaire internet entrepreneur first announced back in 2009 that he would show the country how to farm pigs organically, in the wake of the milk powder scandal. Now, with the papers full of tainted-pork stories, he’s back with news on his promised venture. Phase one – getting the farmland for his pig farms – is now complete.

Ding’s commitment to pig farming has often been questioned. Some pooh-pooh it, saying that he isn’t doing much more than raise stock for his family’s consumption. Others have seen it as a way to draw attention to his web portal, NetEase. But Ding insists otherwise; that he will bring about a “revolution” in the way that China farms pork.

What caused the initial delay in his plans? Compensating farmers for their land and dealing with other land purchase issues was a long process, Ding told the China Daily. His team also spent time investigating pig farming methods in Europe, the US and in China itself.

One thing Ding’s team won’t have missed in their travels: intensive pig farming, often relying on antibiotics and hormones to boost animal bulk. The largest hoggeries also generate huge amounts of manure, which can pollute waterways and neighbouring land.

Water pollution from pig farms even saw the industry banned from the southern city of Dongguan two years ago.

Pig farming is no niche business in China, which is already estimated to raise half the world’s pigs. But the recent scandal over the illegal additive clenbuterol (known colloquially as ‘lean meat powder’ because it promotes muscle development at the expense of fat) has further damaged the industry’s reputation (see WiC100).

“It’s really a big problem,” analyst Pan Chenjun told the Associated Press. “It’s not reported frequently so people sometimes think it’s not a big issue but actually it’s quite widespread” (see issue 61 for WiC’s earlier warning on clenbuterol, and how athletes were blaming dope test results on their sausage diets).

But if he’s successful, Ding’s farm could go some way to changing that reputation. “Our goal is to build a NetEase pig farm that can be replicated in other places rather than be just a one-shot deal,” says Ding’s assistant Zhou Jiong. “In the farm, we will achieve precise control of temperature and humidity, so that pigs live in a most comfortable environment.”

Reportedly, the farm will also only use organic pig feed and will avoid growth-stimulating antibiotics. “We can even trace which pig our meat comes from,” Mao Shan, the project’s general manager, told Kyodo News Service.

Ding claims he will share the farm’s design and working practices for free online, in a bid to encourage best practice behaviour elsewhere. “NetEase wants to present a safe, scientific production model that will not lose money,” he explains. “The model is open and can be replicated, so it is absolutely possible to promote it in China.”

In the long run, the company says it hopes the farm will help farmers improve their techniques, as well as lead to guarantees in food safety for shoppers.

It’s a lofty goal and one that needs the Zhejiang-based farm to prove its own performance first if others are to follow. Whether the 10,000-pig, 80-hectare, university-designed farm can turn a profit is still an open question (construction is yet to start). It certainly won’t be cheap to operate, so it’s likely to be a premium product. There are plenty of other questions too. Will Ding’s reputation for tech excellence and commercial savvy translate into trust when it comes to food?

But one group that may already have been inspired: other internet entrepreneurs. Chen Yizhou, chairman of Oak Pacific Interactive (the company that owns social networking site, and Liu Qiangdong, boss of have both announced agriculture projects too, in pork and rice respectively.

Keeping Track: Food safety issues have featured prominently in WiC over the past two weeks, particularly the concerns about pork tainted with ‘lean meat powder’ – clenbuterol. Now Chinese shoppers disillusioned with their pork suppliers and the government regulators are trying to take matters into their own hands. Sales of ‘clenbuterol detection tests’ are soaring on (they cost around $150 each). That’s despite experts’ warnings that those without the proper equipment won’t get accurate results. (Apr 8, 2011)

© ChinTell Ltd. All rights reserved.

Sponsored by HSBC.

The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.