I See through Everything

Chapter 262: Chapter 141: Cut in Half

The whole point of imitating a formula is to get the same results. If we just make a watered-down version, what’s the point?

Chen Dan opened his eyes and made a decision on the spot. "Xiao He, go to Shanmei as soon as you can. Find Hailufeng Company and start negotiations. We can accept the same terms as Haida Group."

"Yes, Chairman." Xiao He nodded.

It wasn’t just Hengxing Group. Yuehai Group and Aohua Group also caught on. Leveraging their proximity to Peng City, they preemptively sent their own negotiation teams to Shanmei.

As the instigator of this whole affair, Haida Group naturally knew the other feed manufacturers wouldn’t just sit back and do nothing. However, having already seized the first-mover advantage, Haida Group wasn’t overly concerned.

After all, the first spoils of this opportunity were about to be devoured by Haida Group.

Even if other feed manufacturers managed to get a technology license from Hailufeng Company, they would still need to adjust their production lines and research new formulas, a process that would take three to four months at the very least.

Moreover, Haida Group was incredibly shrewd. Emulating Hailufeng Company, they had spent the last few months rapidly filing for over a hundred patents. All of these patents covered feed formulas that used Egyptian Catfish Meal and fish oil.

When the time came, any other company wanting to produce feed using Egyptian Catfish Meal and fish oil would, in all likelihood, infringe upon Haida Group’s patents.

The other feed manufacturers would soon discover this problem. To produce the new feed quickly, their only option would be to come to Haida Group for help. While this move might seem a bit ruthless, sometimes in business, you have to be willing to do whatever it takes.

Of course, Haida Group knew not to push things too far. They could just have the other feed manufacturers pay a licensing fee. That way, the company could make money effortlessly while avoiding turning these competitors into outright enemies.

In reality, for large corporations, patents are a double-edged sword.

Wielded effectively, they can fuel a company’s growth.

Used poorly, they can easily provoke hostility from competitors and may even foster complacency within the company.

It has only been in the last twenty years that patents have started to be taken seriously in the domestic market.

Just a decade or so ago, many companies paid no mind to patents. They wouldn’t just copy from other domestic firms; they’d copy from foreign ones, too.

But that era of wild, unregulated growth is long gone.

Nowadays, brazenly copying another company’s patents has severe consequences.

Just as the major domestic feed manufacturers were all scrambling to send negotiation teams to either Hailufeng Company or Haida Group, the international market began to react.

Although Haida Group had currently produced only 50,000 tons of fishmeal.

But one mustn’t forget, that was only in the first five days of February. Production was set to continue.

Even though Haida Group was already controlling the scale of its Egyptian Catfish farming, it would still be producing 150,000 to 200,000 tons of fishmeal per month, amounting to 1.8 to 2.4 million tons annually.

This volume represented roughly one-third of the world’s total fishmeal production capacity.

Coincidentally, the country’s annual fishmeal imports were also in the range of 1.4 to 1.8 million tons.

In other words, the domestic market would no longer need large-scale fishmeal imports. It might even become an exporter. For the global fishmeal market, this was nothing short of a fatal blow.

Global fishmeal production had already dropped by 30% last year due to major cuts at the Peruvian Fishery. Even so, the moment Haida Group’s production capacity came to light, international fishmeal prices plummeted in response.

Whether it was fishmeal from Hokkaido, Peru, Newfoundland, or the North Sea, prices were in a free fall.

In less than a week, international fishmeal prices were slashed in half.

The price of Peruvian fishmeal with 67% crude protein content, which had peaked at 17,000 yuan per ton last year, plummeted to around 8,300 yuan per ton. Yet, the price hadn’t stabilized; on the contrary, it showed signs of falling even further.

This was happening primarily because the world’s largest importer of fishmeal—a country that consumed a third of the entire global supply annually—suddenly no longer needed it. The consequences were dire.

「Lima, the capital of Peru.」

Many fishmeal producers had been planning to head out to sea early for the fishing season. They hoped to avoid a repeat of last year’s massive production shortfall, caused by extreme weather.

Now, however, dozens of deep-sea fishing companies had, as if by a silent signal, halted their plans.

Inside the office building of a fishmeal producer at Lima Port, the head of the International Market Research department knocked and rushed in. He held a document just sent back from East Asia, his expression grim. "Mr. Oster," he said, "I believe it’s imperative that we reduce the scale of this year’s sea harvest."

As the general manager of the Peruvian branch of Austral Group S.A.A, Austin Oster felt a massive headache coming on after he finished reading the document.

He held the document, scrutinizing it for over ten minutes. Austin Oster knew this was big trouble. He immediately prepared to call headquarters.

But before he could, a call from headquarters came through.

RING RING RING...

"Hello, this is Austin."

"Austin, headquarters has decided to reduce this year’s catch from the Peruvian Fishery. We’re planning a 50% reduction."

"That much?" Austin was aghast.

"Headquarters has just reviewed the outlook for the new technology in East Asia. Their production costs are extremely low. We can’t win a price war. We have to react. Cutting production now can slow the rate at which fishmeal prices are falling."

"I understand."

Likewise, at Lima Port, the Copeinca Company, Diamond Fisheries, and Exalmar Fisheries also decided to cut production.

Other major global fishmeal producers followed suit, all independently resolving to cut production to varying degrees. This included Lucia’s Norebo Group, Chile’s Corpesca S.A., Denmark’s FF Skagen, America’s Omega Protein Corporation, East Japan’s Nissui Company, and Siam’s Thai Union Group.

Even vertically integrated producers who make fishmeal for their own use were considering restructuring their product lines. They also had to prepare for the market to be flooded with massive quantities of cheap fishmeal and fish oil.

After all, the fishmeal and fish oil industries are deeply interconnected. Even companies in the fish oil deep-processing sector would likely find it difficult to escape the fallout from this market shock.

To survive, many companies were already brainstorming ways to further refine their products.

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