Harm de Wildt, managing director, Nutreco EMEA, was first in:
“The global trend over 2014 was one of reduced raw material prices and less price volatile markets than in recent years.
This has had a positive impact on the overall demand for premix and feed specialties, which had been under pressure over the last few years. But commodity stocks are not yet at levels that could provide an adequate buffer.
Other factors for the year to come are regional, such as uncertain Chinese demand growth and the effects of the abolition of the EU milk quota system.
The fundamental drivers of our industry, however, will remain favorable, notably in emerging economies.
Coupled with the continuing trend of professionalization at farm level, demand for specialty nutritional solutions such as young animal feed and feed additives will remain strong.”
Alltech’s chief innovation officer, Aidan Connolly, predicts good growth for smaller countries in terms of overall feed output over the next year. “Smaller countries are beginning to see the positive impacts of the technologies that larger countries have been using for some time now,” he said.
Alltech is just about to release the findings of its 2014 Global Feed Survey in which over 31,000 feed mills in 130 countries around the world were assessed.
“Initial analysis of the survey indicates that global feed tonnage exhibits a slight decline compared to last year’s survey, weighing in at just short of 960 million metric tons.
In 2015, we predict that larger countries will continue to produce more animal proteins - up about 1% - and consume feed at roughly the same rate as they did in 2014. Smaller countries, though, will continue their upward momentum at a faster rate, and will continue to expand throughout the next 12 months, which should lead to overall growth, probably up 1 or 2% overall.”
In 2012 and 2013, the feed survey revealed small, steady increases in feed production across the board, said Connolly.
“This year, however, we have observed a slight decline overall. Among the top five feed producers - China, USA, Brazil, Mexico and Spain - there was a slight downward trend in total tonnage, however some of the smaller countries have had remarkable growth.
There are a number of factors that contribute to this, the main one being that advances in feed technology continue to improve its efficiency. Farmers today can produce more protein with less feed,” he said.
Henrie Verwayen, marketing manager, ForFarmers, forecasts challenges ahead, particularly due to the unrelenting pressure on milk, meat and egg prices.
“On top of this, we also see an increasing focus in several regions on criteria such as feed safety, animal welfare and sustainability."
He said these factors will see margins in the feed to food chain squeezed, especially in net exporting countries like the EU, with a knock-on impact on profitability at farm level.
“For our farmer customers this means they need to further increase scale,” added Verwayen.
Matthieu Leroy, director of projects, communication and institutional relations and CEO advisor, InVivo NSA, says the feed industry picture in 2015 will look quite different from one geographical area to the next.
“We anticipate that volumes will remain stable or experience a slight decrease in Europe in spite of very heterogeneous market trends,” he said.
Regarding Asia and Latin America, Leroy said feed demand should be buoyant in most countries, on the back of increasing animal protein consumption combined with strong population growth.
And he predicts a gradual widening of the range of fish species farmed in aquaculture markets, in particular in countries such as Brazil or Indonesia.
He said that, in general, the global complete feed market will continue to chase superior technical expertise and know-how in order to address current animal nutrition challenges. And he notes more and more emphasis is being placed on feed safety, traceability and sustainability given the trend of increasing feed and food industry convergence.
In terms of the regulatory outlook for 2015, Ruud Tijssens, president of the European Feed Manufacturers' Federation (FEFAC), said the trade group eagerly awaits the outcome of the negotiations between the European Parliament and the Council on the review of EU legislation on official food and food controls.
“FEFAC hopes the mandatory fee system covering all official control costs will recognize the checks performed by feed and food business operators and will allow for more efficient, more targeted controls paving the way for constructive dialogue and cooperation,” he said.
Tjssens also anticipates EU import approval of the 12 GM crops which have already been positively assessed by the European Food Safety Authority (EFSA) – a final decision is awaited from the European Commission.
“The approval is essential to maintain vital feed supplies of protein-rich ingredients and the competitiveness of the EU livestock sector which has to tackle the negative repercussions of the Russian import ban. And FEFAC expects the European Commission will ensure a more predictable, scientific-based approach in its announced review of the GM-decision making process,” he added.
In proactive terms, he said FEFAC intends to put the importance of securing strategic raw material supplies including the sourcing of responsibly produced soy higher on the EU political agenda in 2015.
The trade group will also closely follow developments around the EU Parliament and Council’s scrutiny of the proposal on the recasting of the medicated feed legislation. The 25-year-old Directive needs to be aligned with the principles of the revised general EU feed safety framework, said Tijssens.
Joel Newman, president and CEO of the American Feed Industry Association (AFIA), said 2014 was a year where the US feed industry overcame barriers such as increased regulation in the form of the Food Safety Modernization Act (FSMA) and where it also experienced positive trends including the decline of commodity prices resulting in lower costs in terms of feeding animals in the US.
“Now as 2015 begins, we expect the more cost effective feeding trend to result in sector growth.
A keyword in the New Year will be ‘implementation’ as the industry begins to see how the FSMA rules will affect it. The AFIA will continue to offer education and training programs and work with the industry and the US Food and Drug Administration (FDA) as the rule comes to fruition.
More so, 2015 will bring a republican majority in Congress mixed with a democratic administration. AFIA and the industry will address critical issues such as immigration and energy policy as the year pans out.
Specifically pertaining to feed, global trade will be an area of growth in 2015 and for years to come.
I am optimistic about the year ahead. AFIA plans not to pick up right where we left off, but to hit the ground running with fresh ideas, determination toward our goals and with great expectations for the coming 12 months.”