Brussels event exposes EUDR linked supply chain disruption and feed import dependency
Pedro Cordero, FEFAC President, warned in his address to kickstart the FEFAC annual public meeting on May 31 that European feed companies have yet to receive soybean meal offers for January 2025. These offers would typically already be in place; their absence indicates significant supply chain disruption stemming from growing market uncertainty linked to EUDR implementation.
“We hope common sense will prevail and solutions can be found,” Cordero said.
Questions remain about the technical aspects of the EU Deforestation Regulation (EUDR) and whether the Commission’s timeline aligns with business needs, according to the feed sector. FEFAC and other EU trade groups, in a letter to Ursula von der Leyen, EU Commission President, last month, emphasized issues with the regulation's information system. This register is intended to facilitate the submission and processing of due diligence statements for stakeholders, ensuring a smooth transition at the end of 2024 when the EUDR takes effect. However, the system is currently not on track to meet the requirements of properly functioning supply chains, the signatories stressed.
Policy frameworks and innovation
In addition to discussing market disruptions linked to the EUDR, the Brussels conference focused on the future direction of the EU livestock and feed industry, particularly on facilitating the green transition sustainably and profitably. Speakers emphasized the importance of policy frameworks, innovation, low-impact livestock production, and a more ambitious approach to addressing climate challenges.
Strengthening the resilience and competitiveness of the EU livestock sector is crucial, said Pierre Bascou, deputy director general, DG Agri, European Commission, in his keynote speech. He highlighted the need to reduce the EU’s dependency on feed protein imports while recognizing the increasing domestic output of crude protein from crops over the past 15 years.
Referencing policy instruments such as coupled income support for legumes and protein crops, now included in 20 CAP Strategic Plans, Bascou said the supported area for protein-rich plants in the EU is expected to grow from 4.2 million hectares in 2022 to 6.4 million hectares in 2023, and then to almost 7.1 million hectares in 2027. Moreover, eco-schemes foreseen in 20 CAP Strategic Plans also indirectly support the production of legumes.
It is not just about policy instruments. The Commission, he continued, has been investing in research and innovation in the field of protein crops and feeding systems under Horizon Europe and the European Innovation Partnership on Agriculture to make livestock production systems more sustainable, resilient, and circular.
However, it is worth exploring whether more could be done at the EU and national levels to incentivize farmers to help boost EU protein production, Bascou said.
Despite these efforts, the DG Agri representative would not specify when the long-awaited EU Commission’s protein strategy, originally scheduled for release in Q2 2024, would be published. The upcoming review will be “much more comprehensive and ambitious in scope” though compared to previous protein plans, considering both the demand and supply sides.
Infrastructure
Erik Wibholm, Cargill's director of oilseeds in Europe and the Middle East, emphasized the minimal volume of domestic soybean production in the EU compared to the millions imported each year, despite the efforts that have been made to boost the local supply.
Discussing ongoing geopolitical tensions, during a panel debate, he said that maintaining open markets and a diverse pool of origins is essential for resilience in the face of disruptions.
Ensuring the accessibility of Black Sea ports for EU supply chains is paramount. Compared to sea or river transport, alternatives like truck and rail transportation are less efficient in moving cargo, stressed Wibholm.
Overreliance on amino acid and vitamin imports
Bascou also raised growing concerns about the EU’s overreliance on amino acid and vitamin imports, which could undermine the EU’s strategic autonomy. This dependency has been prioritized as a key issue during meetings of the European food security crisis preparedness and response mechanism (EFSCM). “We are already investing considerable effort to address this issue, working closely with the private sector and the industry. We need to prevent crises rather than waiting and trying to address their consequences,” he remarked.
The EU is not alone in this regard with the US looking to reduce its heavy dependence on Chinese vitamin and amino acid production as well.
Environmental benefits of farming
Additionally, Bascou said it was critical to consider the EU livestock sector in a more balanced way, recognizing what works well and identifying areas for improvement.
Noting the negative environmental impact of animal farming on greenhouse gas (GHG) emissions, on water and soil quality, and on air quality, as well as increasing society demands for improved animal welfare and better production conditions, he remarked:
“It is important to highlight that, despite environmental and climate concerns, the livestock sector has many positive externalities. These include economic benefits, contributions to food security, and environmental advantages such as carbon sequestration, protection of natural habitats and farmland, and biodiversity support.”
The social license to operate
Responding to those comments, Patrick Pagani, deputy secretary general of the EU farmers' lobby, Copa-Cogeca, emphasized that collaboration across the value chain is essential to reposition agriculture and livestock as strategic sectors for our future. He stressed that farmers need confidence in their future, enabling them to continue their businesses with the trust of society, institutions, and stakeholders.
He addressed the growing frustration among farmers over the EU Green Deal policy agenda over the past few years, noting the farmer protests of late arose due to various national issues: “But the underlying sentiment is that farmers feel unheard and misunderstood. However, in recent months, there has been a noticeable shift in approach from the Commission. Farmers are now being listened to, and the Commission has implemented measures to provide greater flexibility.”
Full house for the 68th FEFAC Public Annual Meeting!!
— FEFAC (@FEFAC_EU) May 31, 2024
Warm thanks to our sponsors! @CortevaEUR@Bayer4CropsUS@CargillAnimal@Elanco@USSEC@dsmfirmenichANH@Alltech@HuvepharmaSEA! pic.twitter.com/82pmZwpuQS
Shaping narratives
Also weighing in on the social license of animal farming during the panel session was Birthe Steenberg, secretary general of the EU poultry meat association, AVEC.
To reduce the environmental impact of broiler meat production, collaboration with organizations like FEFAC is crucial, as 75% of emissions in broiler production originate from feed, she commented.
"We must closely engage with the feed sector, which we are doing through the European Livestock Voice (ELV)." The ELV is a consortium of 14 associations in Brussels involved in livestock-related activities.
NGOs perceive campaign groups like the ELV and farming bodies negatively, she noted. This perception has arisen because of livestock organizations' historical silence, she claimed.
While industrializing agriculture was necessary to feed a growing population, farming groups failed to communicate their actions effectively. With the advent of social media, a decade or so ago, they neglected to utilize these platforms, as their focus remained on food production, she said. Meanwhile, others adeptly leveraged social media to shape narratives. "Additionally, as urbanization progresses, fewer people have a connection to farming, resulting in limited awareness of our industry's practices. Hence, we must proactively share our story, and we are now doing so.”
1st panel discussion on EU Open Strategic Autonomy Objectives for the agri-food chain.
— FEFAC (@FEFAC_EU) May 31, 2024
From the @EU2024BE, @AvecPoultry@BirtheSteenberg, @CargillAnimal, to the @EUAgri ➡️ #autonomy#innovation#resilience! pic.twitter.com/Avk7ReXwmo
