I See through Everything

Chapter 56: Chapter 56: The Feed Problem

「Late April.」

Outside the window, the sun shone brightly, and birds chirped incessantly.

A ray of sunlight slanted through the glass, illuminating the devil’s ivy beside the table. Dust motes danced in the light, a clear display of the Tyndall effect.

The air conditioner worked tirelessly, filling the conference room with a contrasting chill.

In a small conference room at company headquarters, Jiang Miao had gathered a group of senior executives for a brief end-of-month meeting.

"...Boss, that concludes the income and expenditure report for April." Ye Meijing finished speaking and sat down.

Jiang Miao gently flipped through the financial report.

The revenue from Hailufeng Company’s core businesses had skyrocketed in April.

Eel fry sales revenue: 145.88 million yuan.

Eel product sales revenue: 2.77 million yuan.

Technology licensing fees: 143.67 million yuan.

Strawberry sales revenue: 730,000 yuan.

Gross profit from direct-to-consumer stores: 40,000 yuan.

Gross profit from the gold shop: 60,000 yuan.

Total: 293.15 million yuan.

This was nearly double the total income from the previous four months combined.

Of course, this was largely because the income from technology licensing fees made up the bulk of it.

The price of eel fry bottoming out and rebounding in April was also a major contributing factor. A mere two-mao increase in the average price per glass eel might not seem like much, but in reality, it added nearly 12 million yuan to Hailufeng Company’s revenue.

Jiang Miao continued to flip through the financial report, turning to the expenditures for the month. frёewebnoѵēl.com

Aside from the relatively fixed costs of salaries, performance bonuses, the five social insurances, rent, utilities, fuel, and office supplies...

The company’s largest expense in April was actually the purchase of raw gold materials, totaling 30 million yuan.

They had also spent 4.5 million yuan to acquire a gold jewelry processing plant in the neighboring Meilong Town of Hai Feng County, further completing the company’s industrial chain.

Meanwhile, the purchase of mature eels, previously a major expense, was gradually being replaced by the farm’s own cultivated eels, reducing monthly expenditures by several million yuan.

As for the cannery, did it purchase mature eels from other eel farms?

The answer was no.

Eels from other farms’ open-air ponds had a noticeable muddy taste, while eels from indoor, high-precision farms were too expensive. Both would affect the cannery’s product quality and production costs, so they did not source eels from other farms as raw materials.

Currently, Hailufeng Company’s soft-canned kabayaki eel was in a state of demand far exceeding supply. This was because the company’s culled female eels had almost no muddy taste and were moderately priced, making them highly sought after by many Japanese restaurants and sushi shops.

Just as Jiang Miao was looking over the financial report,

His brother-in-law spoke up. "Chairman, there’s something I need to bring up. The price of regular fish feed has risen a lot this year. One ton of high-standard fish feed costs nearly 17,000 yuan. To raise eels from the leptocephalus stage to maturity, it takes about 2.2 tons of feed per ton of mature eels. This brings our feed cost per ton of eels to around 36,000 yuan."

"This year, the wholesale price for mature eels is generally between 90,000 to 120,000 yuan per ton, and larger market eels are around 80,000 yuan per ton. The cannery sources its eels internally, so we can keep the cost down to about 50,000 yuan per ton, but this isn’t a sustainable solution."

Hearing what his brother-in-law said, Jiang Miao shook his head helplessly. "Fish feed requires imported fish meal as a raw material. There’s nothing domestic feed mills can do about it."

The price was difficult to control because of the raw materials, as the cost of imported fish meal rises every year.

The better quality codfish meal, for instance, generally costs 80,000 to 90,000 yuan per ton to import, while other common fish meals are around 17,000 yuan per ton.

Even if fish meal only makes up about one-tenth of the feed’s content, it still accounts for a very high percentage of the cost.

Unless plant-based soy or corn can be used to replace the high-protein fish meal, the price of fish feed is unlikely to come down.

Suddenly, Jiang Miao’s brow twitched. He had thought of a solution. "Manager Zhang, I’ve come up with a way to solve the fish feed price issue."

"Oh? Chairman, what is it?" His brother-in-law was immediately intrigued.

"Catfish! Egyptian Catfish!"

"Egyptian Fish?" His brother-in-law was taken aback. "Using Egyptian Fish to make fish feed? Is that feasible?"

"It is. The only problem is that Egyptian Fish have a very high geosmin content. If used as a raw material for fish meal, it will increase the muddy taste of the eels we raise."

His brother-in-law quickly caught on. "But don’t we have a special feed for removing that muddy taste?"

Jiang Miao smiled and nodded. "Exactly. In any case, the eels we use for breeding have to go through more than a month of indoor cultivation at the end. During that period, they can metabolize the geosmin in their bodies. So, using Egyptian Catfish as a raw material for fish meal isn’t a problem."

"So the Chairman’s idea is for us to farm the Egyptian Fish ourselves to make the feed?" Zhang Xincheng guessed.

Hearing this, Jiang Miao shook his head. "That’s not necessary. We need to further expand our local influence. Besides, Egyptian Fish are an inexpensive, commercially farmed species to begin with."

"Have other farmers raise them?"

"Mhm." Jiang Miao then gave his orders. "Manager Zhang, Jiale, form a temporary working group. Focus on Magong Town, Red Grass Town, and Meilong Town. Find local farmers and sign contracts with them. The purchase price will be four yuan per kilogram of Egyptian Catfish."

The Deputy Manager of the Purchasing Department, Chen Jiale, nodded. "No problem."

"How many mu do we need to contract for?" his brother-in-law asked cautiously.

Jiang Miao recalled the growth cycle and per-mu yield of Egyptian Catfish, then gave a rough estimate. "Egyptian Catfish can be raised for a little over three months, and the yield per mu can reach about five tons. Contract for at least a thousand mu to start. We can adjust it later based on the situation."

"A thousand mu? Alright." His brother-in-law nodded.

After all, many people in the Hailufeng Region used to farm Egyptian Catfish. It was only because of issues with its taste and an old rumor about them being "fed with feces" that the fish’s reputation plummeted.

But the taste of pond-raised Egyptian Catfish was truly hard to describe. The muddy flavor, in particular, was so overpowering that it could only be made barely palatable by masking it with heavy seasonings.

He then instructed the Purchasing Department Manager, Wang Feng, "Wang Feng, take some people to scout nearby factories. Find one we can take over for a feed mill. The site needs to be able to support an annual output of at least 200,000 tons of feed. Purchase the equipment as soon as possible, too."

"Yes, sir." Wang Feng quickly accepted the task.

The reason for a 200,000-ton capacity site was to prepare for future expansion.

With so much planned production capacity, Hailufeng Company’s own farms certainly couldn’t consume it all. Exporting was the inevitable choice.

And while Egyptian Catfish Meal was low-cost, its downside was that it increased the muddy taste in the fish meat.

This was also why many feed mills didn’t use freshwater fish as raw material. Many cheap freshwater fish had a muddy taste to some degree, and the cheaper the fish, the stronger the taste.

Saltwater fish have very little of this muddy taste. Codfish meal, in particular, is almost free of geosmin and has an extremely high protein content, so its price is naturally high as well.

For high-value commercial fish species today, a muddy taste is the biggest taboo. It can drastically reduce the selling price and even ruin a brand’s reputation.

Therefore, if Hailufeng Company were to sell its catfish feed, it must be paired with the specially formulated taste-removing feed. They would instruct farmers to use this special feed for one month before selling their eels, while also transferring the eels to small, flowing-water tanks. This would rapidly reduce the geosmin accumulated in the eels’ bodies.

If a cheaper feed were available, many farmers would certainly be willing to try it.

Otherwise, with farming costs remaining high, farmers’ net profits would be too low. This would, in turn, dampen their enthusiasm for farming, which would then affect the demand for eel fry.

Every link in the production chain affects the overall profitability of the product.

Fortunately, Hailufeng Company had suppressed the price of eel fry, bringing the cost of fry per mu of fishpond down to around 5,000 yuan. fɾeeweɓnѳveɭ.com

Previously, the cost of eel fry per mu of fishpond had been consistently around 6,000 to 7,000 yuan.

That extra thousand-plus yuan was the profit margin they had squeezed out.

With a profit margin, farmers would continue to raise eels. Otherwise, they would definitely switch to farming other aquatic products.