DSM’s animal nutrition business showing strong, sustained volume growth

By Jane Byrne contact

- Last updated on GMT

© GettyImages/skynesher
© GettyImages/skynesher

Related tags: Dsm, Latin America, China

DSM’s animal nutrition business delivered 7% organic sales growth in the first nine months of 2021.

The company called it “a very good performance”​ particularly when building upon 8% organic growth in the prior year.

The vitamins maker said the strong, sustained volume growth in the nine months was underpinned by customers’ desire to operate at higher inventory levels given the widespread and ongoing supply certainty concerns.

The business benefitted from continued good business conditions across all species and especially strong demand in China and Latin America.

Q3 review

In an update on progress for Q3 2021, the specialty chemicals producer said its animal nutrition unit delivered 12% organic sales growth, led by very strong volume growth of 14%, supported by the reopening of global economies.

“Business conditions remained favorable, consistent with the first half of the year. All species continued to perform well, with aquaculture showing a strong recovery as food services reopened.”

Geographically, all regions saw continued good conditions, with Latin America being exceptionally strong and only some softness in North America caused by ongoing labor shortages in the meat packing industry, said the Netherlands-headquartered firm.

“Prices were -2% against a tough comparable of +5% in Q3 2020 when the business experienced COVID19 related price effects and the pass-through pricing of externally sourced ingredients, foreign exchange related price increases, and strong sales mix effects across regions.”

The recently acquired Erber businesses, Biomin and Romer Labs, which were consolidated from 1 October 2020, delivered another strong quarter with €80m (US$93m) sales and total adjusted EBITDA of €21m, reported DSM.

For the full year, the company said it continues to expect an adjusted EBITDA increase in its overall nutrition division at the upper end of its mid-term strategic ambition of high single digit growth.

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