Latest Technology is Key to SurvivalBy Jan Hogewoning | Thu, 06/25/2020 - 10:00
Q: What is the key to your success as a manufacturer of agricultural construction equipment and parts?
A: Our company started in the area of agriculture construction, specifically metallic structures to keep chickens. We went on to develop a wide range of structures and machinery. As our company grew, we not only became one of the biggest players in Mexico but also started exporting to Central and South America. The vision from the beginning has always been to incorporate the latest technology. This has helped us to remain standing. Many other Mexican companies in our niche stopped doing their own product development and started selling products from American and European companies. Today, we produce all kinds of equipment, and a lot of it can be controlled with mobile devices. Phones can monitor things such as the feeding process, the drinking system, the production of eggs and climate conditions. We build eighty-five percent of our products. The control software is not ours, but we have agreements with third parties.
Q: Of all your product areas, which one attracts the greatest demand?
A: Our portfolio is broad. We can make specific things for specific animals, such as areas for pregnant pigs, or special feeding spaces. But we also make large structures for industrial warehouses. We even build trailers for food transport. We also have special chemical coatings, such as electrostatic paints. Of all our divisions, agriculture remains the biggest, with the poultry sector being our main client. However, the other areas serve us well when agrobusiness is a bit slower.
Q: How does De Anda Grupo Industrial encourage transfer of technology to smaller farmers that sometimes lack access to these kinds of sophisticated systems?
A: Many small producers want to increase their level of technology. Sometimes they are new in the business and want to immediately have a sophisticated operation that they can run with few employees. This is not always a good idea. If your production is small, and you invest to automize it, you risk not getting the returns to pay off the investment. We advise clients on the best solution, taking into account the existing infrastructure and the scale of production. If they want an operation with a high level of technology, they need to have a reliable supply of electricity, and sometimes a good internet connection. If they meet these conditions, we help them with everything they need to get set up.
Q: What is the level of technology penetration in the country’s poultry sector?
A: I would say about 50 percent of the sector is using advanced technology. This includes the very large companies. A big segment of the industry, however, is between manual and full automatization. This basically means that the cages are elevated and the egg collection is automated, but the environment does not have elements such as climate control. There are also small producers that are working a manual operation. With such a large segment seeking more technology, there is a great deal of potential in Mexico. The advantage of automatization is that it greatly increases your production. Manual production results in 20,000 to 30,000 eggs a day. In the semi-automated area, you can reach around 50,000. In the case of fully automated, you are talking about 100,000 eggs.
Q: How do you compete against foreign companies in your niche?
A: It is important to always be up to date with the latest advances in technology. Otherwise, clients will not come looking for you. Many second- and third-generation business owners in the poultry sector are young people who do not intend to spend their whole life on the farm. This makes remote control a very attractive option for them. With respect to our foreign competitors, they are very strong and have strong support from their governments. At events and conferences, their governments will have entire pavilions to promote these businesses. Unfortunately, we have not received a great deal of support from our government to help expand our export base. Bodies like ProMéxico are disappearing. Nonetheless, we continue to participate in these events and work hard to be the preferential choice for potential clients.
Q: What are the principal tendencies in the market?
A: A tendency right now is cage-free chickens. In the EU and the US, this is already advanced. In Mexico, it is starting to grow. One obstacle is that introducing these types of standards also increases production costs. You need bigger spaces for the same number of chickens and the eggs need cleaning to remove the dirt. In the Mexican market, most consumers will not buy an egg that suddenly costs 10 cents more. At the same time, these costly changes could take away jobs. In this respect, the conditions in this country are holding back this transformation.
Q: What are your goals for the next year?
A: We will continue to modernize our offer, including equipment for cage-free chickens. At the same time, we are reengineering certain aspects of our products for pork production. Our objective is to continue to consolidate our position in the national market as the biggest market player. However, we also want to grow our exports. Peru has gone very well, and Guatemala and El Salvador have proven very successful. After consolidating our position in Peru, we will move to other countries in South America. In terms of new clients, we are seeing more uncertainty in the Mexican market. Many businesses want to grow but they are taking smaller steps. As the economy picks up, we expect their appetite for investment will return too.
De Anda Grupo Industrial, based in Jalisco, manufactures agricultural construction equipment and spare parts. It is major player in the poultry, pork and cattle segments. The company also builds structures for other agricultural and industrial purposes