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Story Publication logo November 3, 2014

Feeding China: Iowa Firm Helps Hatch Egg Industry Expansion


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China faces huge challenges in feeding its people sustainably and safely. Iowa and U.S...

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Every year, about 250,000 chicks make a 7,000-mile journey from central Iowa to China.

The migrations begin at a hatchery in Perry, where crates of day-old chicks travel by roller-bed truck to airports in Chicago or Indianapolis, then by Air China or Federal Express plane to Beijing or Shanghai. Then it's back on the road to breeding farms in places like Handan, in Iowa's sister state of Hebei.

Their progeny will end up in egg-laying operations all over China, the world's largest egg producer.

Hy-Line International, based in West Des Moines, is a quiet company with a global impact. Its central Iowa research farms produce chicks that will grow up to be "grandparents" to laying hens prized for their productivity and hardiness. Hy-Line breeds chickens to thrive in places as varied as Colombia, France, Australia and India.

The company estimates that 40 percent of the laying hens in the world come from its genetic lines.

Hy-Line is positioning itself to have a greater role as China's egg industry moves from 10,000-hen farms to U.S.-style operations of 1 million birds or more. It's supplying not only chicks, but also technical expertise to help customers like the Handan-based Huayu Group expand.

"Hy-Line will grow as China's industry grows," said Charley Zheng, Hy-Line's business manager in China.

Why China's egg production matters to Iowa

Iowa is the nation's largest egg producer. It's also home to one of the world's largest suppliers of poultry genetics, Hy-Line International.

Growth in China's poultry industry means more opportunities for Iowa farmers to sell corn and soybean feed.

The relationship between Hy-Line and Huayu is an example of how companies in Iowa and China cooperate. Huayu is Hy-Line's second-biggest customer in China, buying 60,000 chicks a year, and is growing quickly. It's been a customer of Hy-Line since 2006, but the two formed closer ties after Xi Jinping, now China's president, visited Iowa in 2012.

Hy-Line is assisting Huayu Group with its expansion plans, which include new breeding facilities, a research and development center, incubators and other operations.

Huayu Group's goals include expanding from producing 80 million layers a year to 200 million.

Corn, hen breeders share Iowa roots

What DuPont Pioneer is to seed corn, Hy-Line is to poultry genetics, except even more dominant. In fact, the companies have common roots.

Hy-Line was established in 1936 by Henry B. Wallace. He used the hybrid breeding practices developed by his father, Henry A. Wallace, who founded Pioneer Hi-Bred and became secretary of agriculture and vice president under Franklin Roosevelt.

Hy-Line is now owned by a German company, EW Group.

The company promotes that its birds' genetics offer increased egg production and quality and greater disease resistance. It hosts customers from all over the world at its technical school in West Des Moines, where producers learn about biosecurity, nutrition, animal welfare and other practices.

It has about 180 employees, research farms and operations scattered around central Iowa, including a layer breeding stock hatchery outside Dallas Center. In 2012, the company opened another high-security hatchery in Perry.

That's the starting place for the chicks bound for China. The day-old chicks are sorted by sex, vaccinated, banded and put in a box. One shipment could include anywhere from 7,000 to 42,000 chicks, at a cost of $30 per chick.

Hy-Line has a window of 40 to 48 hours to get the chicks to China, or their health will deteriorate.

Hy-Line emphasizes that it follows strict animal welfare practices, and it has improved conditions for the chicks.

Zheng said a few years ago, the company had problems with mortality. It lost a whole shipment of chicks when snowstorms delayed transportation or other problems occurred in China.

New trucks are ensuring safer shipments, Zheng said, and the company has avoided winter shipments. Mortality is now under 10 percent, he said.

About 80 percent of the chicks Hy-Line sends to China are related to the venerable U.S. breed Rhode Island reds, and they produce brown eggs.

Iowa expertise aids company expansion

Huayu's expansion plans are taking root 60 miles west of Handan, in the Taihang Mountains in southwest Hebei Province.

A one-lane paved road rises out of a small village, past an unfinished Buddhist temple, to a collection of breeding houses under construction. Few poultry or hogs are raised in this area, making it a good location to prevent the spread of disease.

At 1,900 feet above sea level, the air quality is better here for chickens. Handan has some of China's worst air pollution.

Hy-Line helped choose this location and provided other technical expertise. The buildings have automatic feeders and other controls. Four rows of cages are stacked four floors high, and each of the cages — which range from 8 to 30 feet in length — will hold anywhere from 50 to 100 birds. Some of the cages have perches.

Huayu is experimenting to determine the best approach. Some houses have Japanese equipment, and the others are supplied by Big Dutchman, a German company with major U.S. operations.

These houses will hold parent stock, and their eggs will travel to the company's incubators.

Huayu officials say they're having trouble keeping up with demand and have plans to build incubators that would be triple current size.

One of its incubator facilities in Handan can handle up to 500,000 eggs a day. Eggs spend about 20 days in the incubator. As soon as they hatch, the chicks travel by conveyor belts to a room where they are given injections to prevent disease.

The chicks will be shipped within 48 hours by plane to egg-laying farms in China, completing the journey begun in Iowa.



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