According to a new study released by MarketsandMarkets, the overall world feed additives market had revenues of approximately US$16.18 billion in 2012 and is expected total US$20.2 billion by 2018. Its predicted 3.8% growth rate is in the low range of feed supplement market studies we surveyed, which forecasted market growth rates ranging from 3.8% to 4.2% over the next five years. But these estimates are still roughly twice as fast as the forecasted 2% annual increase in world meat demand over the same time.

 

 

 

 

Offering great opportunities to supplement suppliers and livestock farmers alike, this wave of emerging, 21st century feed supplements are more than a set of new product classes. Much more than the old antibiotic growth promoter (AGP) and growth hormone based paradigm of yesteryear, the ascending set of sustainable feed supplements represent a web of natural ecosystem components that only work in an optimal manner when they are used together in a coordinated manner.

 

Encompassing everything from antibiotics to plant extracts, vitamins to organic acidifiers, overarching general market forecasts hide the considerable market transformation and profoundly different growth fundamentals of various livestock supplement submarkets.

 

 

 

Certain segments are growing at nearly twice the 4% overall rate, while others are staying flat or in decline. If one must generalize, traditional AGPs and synthetic additives have topped out and, in some geographic regions or market segments, are actually declining. Similarly, Europe is the most mature region and poultry the most mature livestock supplement species category.

 

These are being more than counterbalanced by changing laws and consumer attitudes, strong growth in natural supplement lines, the ability of some supplement classes to boost the productivity of AGP reared animals, new dose delivery formats for traditional minerals and the need for product classes such as toxin binders to support vaccines and other health control measures

 

Slowing growth in the EU and the world poultry sector is being counterbalanced by rapid supplement uptake in swine and aquaculture, as both these sectors have a large share of their animal inventories in rapidly growing East Asian markets. A the same time, the rising possibility of changes to the US legal or consumer demand landscape looms as a wild card that could boost the industry's overall growth up by up to one percentage point above expectations (see article on acidifiers).

 

Whereas the poultry sector accounts for 40% or more of demand for most feed supplement classes, aquaculture, which is the smallest segment, will lead in growth. MarketsandMarkets projects aquaculture related supplement revenues to rise at a 12.1% annual rate in the years from 2012 to 2018. The swine sector will grow at a markedly faster than pace, particularly with respect to feed enzymes, which hogs will demand 7.5% more of each year.

 

As is the case with other feed supplement classes, Europe's large market and ground breaking 2006 AGP ban gave it the largest share of the world feed enzyme revenues at 46%, with Asia-Pacific accounting for 23%, North America 21%, and other regions 10% respectively. Worldwide, phytase demand is growing most quickly among feed enzymes, followed by that of NSPs (though phytase's expansion does come at the expense of demand for phosphate supplementation in feed).

 

 

 

By value, the world feed enzyme market segment is also one of the fastest growing; with revenues of US$781.7 million in 2012, it is expected expand at an average rate of 7.3% over the next five years, with revenues totaling US$1.193 billion by 2018. With the mature European market already saturated by its early, post AGP ban uptake of feed enzymes, Asia Pacific and North America will compensate with above average growth rates of 7.1% and 7.6% respectively. Moreover, with the swine sector's demand for feed enzymes increasing at a 7.5% annual rate over this time, Asia and North America's rapid feed enzyme demand growth merely reflects that between them, they account for 66% of the world's hogs,

As the largest integrated livestock market facing the prospect of new regulations (which creates demand for natural supplements), we project North America's feed enzyme demand growth to lead all regions.

 

With phytase leading the way, North America's overall feed enzyme demand is expected to rise at a 7.1% rate by value in the five years from 2013 inclusive.

 

But it must be said that North America's phytase demand differs from that of other regions, as it mostly comes from the poultry sector.

 

By comparison, phytase demand in Europe mostly comes from the swine sector. The same is also true in Asia, where China, with half the world's hog inventory, has its phytase consumption also driven by swine. Although this makes swine a bigger driver of phytase demand than poultry that could change over the long run, particularly if India's poultry driven enzyme demand begins to take off.

 

Across all regions, phytase and non-starch polysaccharide enzymes (NSP) dominate the feed enzyme sector in terms of value. In particular, protease shows promising growth across all regions, and is projected to see world revenues rise an average 7.2% rate annually from 2013 to 2018. Growing meat consumption in Asia drives demand for poultry and swine meat, and in turn for NSP and phytase enzymes.

 

At the same time, we are now in an era when we are not only changing the type of feed supplements used to maximize animal performance, but also the livestock way are raised and the types of feed materials they are fed. If that was not enough, we need to co-ordinate the ways these new supplement classes are used together, and even the way we use them with older technologies, be they traditional antibiotics, vaccines or livestock housing techniques.