2021 EU compound feed production has been affected by the spread of animal diseases and the continuing Global grain market rally.
EU 27 compound feed production for food producing animals in 2021 is estimated at 149,9 mio. t, a slight decrease of 0.16% compared to 2020, according to forecast data provided by FEFAC members.
Following the 2021 EU critical pig meat situation, facing challenges of reduced meat demand in key export markets (sanitary import ban), high costs for feed grains and the impact of African Swine Fever, the pig feed production is estimated to decrease by 1.3%. The countries most affected are particularly Germany, Austria, Portugal, Finland and Hungary. In addition, some Member States, (e.g. The Netherlands & Belgium), are depopulating their pig herds in order to lower agricultural environmental emissions.
Despite the continuing spread of Avian influenza in several parts of Europe in 2021, poultry feed production is set to slightly increase by 0.8%. This is mainly due to the improved situation in the HORECA chain (Hotel/Restaurant/Catering) when businesses reopened following lifting up the lockdown measures across Europe, especially in the summer tourist destinations such as Portugal & Spain but also in Hungary and Romania. With the UK leaving the EU in 2021, poultry feed production lost its position as the leading segment of EU industrial compound feed production to pig feed.
Cattle feed production is estimated to slightly increase by +0.1% compared to the previous year, mainly due to a higher increase of production in Italy, Poland and Romania (+3-5%). The situation in other EU countries is rather stable or shows a minor decrease. This is mainly due to higher forage production lowering demand for cattle feed.
In general terms, demand for compound feed was lifted due to the continuing global grain market rally making industrial compound feed economically more attractive over home-grown feed cereals.
Due to supply chain difficulties and the high cost of procurement to source the “non-gm” protein sources, market partners are demanding more certified/verified responsibly produced protein sources (soy products).
Market outlook for 2022
FEFAC members expect a continuation of several key market drivers which could weigh in against demand for compound feed in 2022:
- Reduced export opportunities for pig meat producers.
- Continuation of the Global grain market rally (expected to continue until the end of MY 2021/2022).
- The continued spread of animal diseases (ASF & AI).
- Covid pandemic & lockdown measures.
- Environmental concerns (pressure on lowering GHG and other emissions).