E.U. compound feed on upward trend

by Susan Reidy
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EU feed
FEFAC report shows feed production is up 7.7% from 2009.
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E.U. compound feed production continued its upward trend in 2015, showing a slight increase to 155 million tonnes from 153.3 million tonnes a year earlier, but up 7.7% from 2009.

The 155 million tonnes accounted for 80% of all purchased feeding stuffs, according to the Feed & Food Statistical Yearbook 2015 released by the European Feed Manufacturers (FEFAC) in December 2016. Cattle feed production decreased slightly while pig feed increased slightly. The largest increase was seen in poultry feed, which was up 3.25%, to 53.7 million tonnes.

Although production was up, the total number of feed production units was down 1.7%, to 3,564. The number of units has continued a mostly downward trend, and is down 12% from 2005, according to the FEFAC yearbook.

Overall, global compound feed production in 2015 was 986 million tonnes. China produced the largest amount at 180 million tonnes followed by the U.S. at 174 million tonnes and then the E.U.

Compound feeds are manufactured from a mixture of raw materials designed to achieve pre-determined performance objectives among animals. These raw materials are obtained from a variety of sources. As a result, the industry provides a major market for E.U. cereals, oilseeds and pulses. Some raw materials are obtained from the co-products of the food industry.

The top ingredient used in compound feed production was feed cereals, amounting to 48% of the total at 74.1 million tonnes. The second-most popular feed material was cakes and meals at 43.9 million tonnes, representing 28% of the materials used. Co-products from the food and ethanol industry was next at 17.5 million tonnes, or 11.5%.

Other important ingredients, which cannot be grown in sufficient quantity in the E.U., are imported from third countries. These diverse sources of raw material supplies are an important factor in the industry’s ability to manufacture feeds of both high quality and at competitive prices for livestock farmers, FEFAC said.

FEFAC represents 25 national associations in 24 E.U. member states as well as associations from Norway, Turkey, Serbia, Russia and Switzerland.

Country breakdown

EU feed
Global compound feed production (million tonnes).
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Within the E.U., Germany produced the most compound feed at 23.3 million tonnes, down slightly from 24 million tonnes a year earlier. Rounding out the top five producers were Spain at 22.3 million tonnes; France at 21.1 million tonnes; the U.K. at 15.4 million tonnes and the Netherlands at 14.3 million tonnes.

Production was down slightly in France and the U.K., but increased slightly in Spain and the Netherlands. The biggest increases in feed production were seen in Bulgaria with a 21.1% increase to 1.2 million tonnes. Lithuania produced 507,000 tonnes, an increase of 12.9%, while Romania’s production was up 7.3% to 2.5 million tonnes and Ireland’s production increased 7.2% to 3.9 million tonnes.

Feedstuff value

EU feed
Feed material consumption by the compound feed industry.
To view the full chart, click here.
 
The value of all feeding stuffs used by E.U. livestock producers, including forages produced on the farm, is estimated at €90.8 billion in 2015. This accounts for 37% of all inputs and 55% of the turnover in livestock production, according to the report.

Animal feed, including feed materials and compound feeds, are the main input into livestock production. About 477 million tonnes of feed are consumed by livestock each year. Out of this, 233 million tonnes are roughages grown and used on the farm. The remaining 244 million tonnes of feed includes cereals grown and used on the farm of origin (51 million tonnes) and feed purchased by livestock producers to supplement their own feed resources (either feed materials or compound feed).

Purchases of compound feed in 2014 amounted to €49 billion. The compound feed industry has become capital intensive in recent years and makes use of a high level of technology. Advanced methods are used to formulate feeds according to the demands of the livestock farmer — which reflects final consumers’ demand — and to control the raw materials used, the manufacturing process and the quality of the finished feeds, the report said.

The compound feed industry is subject to a complex body of both E.U. and national legislation affecting almost every part of its operation. This legislation is designed to ensure that feeds are of high quality and are safe for both livestock and consumers, FEFAC said.

Livestock products

The market for feed is dependent on the market for livestock products, the report said. In 2015, the livestock population produced 50.3 million tonnes of meat (7.6 million tonnes of beef, 22.9 million tonnes of pork and 14.4 million tonnes of poultry), 164 million tonnes of milk and 7.6 million tonnes of eggs. The value of livestock production, amounting to €164.3 billion, accounts for 39.7% of the overall agricultural output of €414 billion in 2015.

Average per capita consumption of meat (including horse meat, rabbit and offals) in 2015 was 91.6 kg, compared to only 50 kg during the late 1950s. Growth of compound feed production increased more than 7.5% per year during the 1960s and 1970s. This was due to the demand for animal products linked to increasing purchasing power. The pig and poultry sectors were becoming more intensive, requiring greater use of industrial compound feed to meet high performance and quality requirements, FEFAC said.

For the rest of the 1970s, annual average growth in compound feed production slowed down to 4.4%, partly reflecting the effects of the 1973 “oil price shock” on consumers’ income. Following a period of steady increases from the mid-1980s on, consumption of livestock products grew more slowly. This was due to a saturation of the market and increasing consumer concern about health matters and animal welfare.

From 1996 on, compound feed production was hurt by the BSE crisis, which resulted in a 9% reduction in cattle feed from 1995 to 1998. The decrease partially was offset by a growth in consumer demand for white meat. As a result, compound feed production in the E.U. has remained almost stable since 1996, FEFAC said.

Increases in 2004, 2007 and 2013 brought an additional 22 million tonnes of compound feed to E.U. production.
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