The Kentucky-based feed additive company presented results from its eighth annual global feed survey on Tuesday [January 29]. It relies on information from almost 30,000 feed mills along with industry associations and government data in 144 countries to generate the report.
The survey provides insights into the changes in economic growth, prosperity and the industry, said Mark Lyons, president and CEO with Alltech. The company has representatives in more than 120 countries who also provide information and insight.
Feed for broilers and swine saw the most production, with about 304m metric tons of broiler feed produced globally, followed by 293m metric tons of swine feed, the company said. For production species, aquaculture had the smallest amount of feed generated at 40m metric tons.
“We find that the survey helps us to find other economic factors and we find that it’s interesting to many institutions, investors and governments themselves,” Lyons said regarding why Alltech continues to present the report. “We find that it helps us to be better advocates for agriculture and the impact that agriculture has around the world.”
Regionally, Asia-Pacific generated the largest percentage of feed overall in 2018, manufacturing about 394.9m metric tons, he said. Europe followed generating about 25% of the feed made or 277.1m metric tons, then North America at 198.9m metric tons and Latin America with 164.4m metric tons.
Africa contributed about 4% to global feed production with about 40.6m metric tons overall, and the Middle East created about 27.6m metric tons, he added.
“If we looked beyond this we see growth, and we can see that Africa is representing an interesting new opportunity [with] 5% growth in Africa this year, which reflects certainly the economic growth we see in this continent,” Lyons said.
Overall, top five feed producers for broiler feed included China, the US, Brazil, India and Russia, Alltech said.
The top five feed producers for swine feed were China, the US, Brazil, Russia and Spain, while the top manufacturers of aqua feed were China, Vietnam, India, Norway and Indonesia.
North America saw about 2% growth in feed production that spread across all major production species in both the US and Canada, Alltech said. The region also continues to have the lead in the manufacture of beef feed, which increased by 3% in 2018.
However, there have been some shifts in production, especially on the dairy side, said Lyons. There also continue to be questions about the potential for consumers to trend away from beef.
Latin America generated the second largest amount of broiler feed of any region, despite the fact that broiler feed production dropped 2% based on results from Brazil, Colombia, Venezuela and Chile, he said. Brazil saw some challenges in 2018 but is expected to have more opportunities in 2019.
“Mexico is an area where we look for great growth,” he said. “We’re looking for some tremendous growth from Mexico in 2019 in our own business and the industry, in general, is quite optimistic.”
Production in Europe expanded 4% and continued to see Russia play a role, said Lyons. The country generated about 39.2m tons of feed last year, with about 42% going to feed swine.
“Spain also [was] pig dominated with over 30m tons of feed,” he said. “The Turkish market again a market that has been growing quite quickly and a very diversified market, [with] 25% of the feed tonnage going to dairy.”
The Asia-Pacific region, which had 3% growth in total, saw strong generation in aquafeed along with broiler and layer feed, said Lyons. “The poultry sector is really dominating what we’re seeing in Asia,” he added.
However, in China, the dominant species of interest in terms of feed production is the pig, he said. About 42% of the feed produced is for swine.
However, with the outbreak of African Swine Fever there could be challenges for producers in the next few years, he said. “There were estimates of African Swine Fever having such an impact that it could remove 30% of production in 2019 and 2020,” he added.
“That’s something to really think about because as that pork is removed from the market we know that exports can only represent a certain percentage of the picture,” Lyons said. “We know that the Chinese market is so dominant, so large that there are few countries that could export enough pork to make up that gap.”
India saw strong growth during 2018, with about a 13% increase in feed generation, he said.
In Southeast Asia, aqua feed played a large role, he said. Most feed production comes from Vietnam, the Philippines, Thailand and Indonesia and those countries tend to have less expensive feed costs, overall.
Despite having the largest growth in total feed production, Africa continues to see high feed costs, said Lyons. Producers face challenges with logistics and regulations along with the amount of imported materials.
“We believe that Africa over the next decade will represent one of the biggest opportunities for the feed industry,” he said. “There’s a lot that we can do globally to really think about the Africa market and how it’s going to change because the population growth is there and we also know that the GDP growth is there.”
Countries in the Middle East continued to see increased production in broiler feed, especially in Iran, he said. However, there also is support for dairy production.