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Animal Health

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FEED Business Worldwide - August, 2011
American, EU & Asian agribusiness giants vie for control of Provimi

After being put up for sale by its private equity group owner Permira, Provimi attracted a slew of financially powerful bidders including Nutreco, Royal DSM NV Cargill and the New Hope Group.
A source familiar with the situation stated that Dutch rival Nutreco NV and Dutch life and materials sciences company Royal DSM NV submitted bids. According to press reports, Chinese agriculture firm New Hope Group and America's Cargill also put in bid in the auction's first round.
Based in Rotterdam, Provimi posted profit before tax of EUR65.1 million (US$93.1 million) on sales of EUR1.6 billion (US$2.3 billion) for the year ended December 31, 2010.
The company has been valued at up to EUR1.8 billion (US$2.6 billion), which could deter the Dutch bidders. Analysts say that Nutreco can only pay a maximum price of EUR1.3 billion (US$1.9 billion), while market observers see the strategic rationale of DSM buying Provimi but question the price that it may have to pay.
DSM also produces ingredients and animal feed additives but acquiring Provimi would enhance its exposure to emerging markets, such as India, Brazil and Russia, where Provimi has a strong market position.

Euroduna and Citoforte to collaborate in Asia Pacific

Germany-based speciality feed and food ingredients supplier Euroduna is collaborating with Singapore-incorporated Citoforte to make Euroduna-sourced ingredients available to customers from the Middle East, Asia, Australia and New Zealand.
Euroduna makes available a wide range of ingredients to the food, animal feed and pet food manufacturing sectors. Unique ingredients include Caromic, a natural feed ingredient containing high levels of energy and tannins for increased palatability and intestinal bio regulation for animals. Similarly, Carochoc which contains naturally high levels of carbohydrates is used in products such as ice cream, confectionaries and soft drinks, is also supplied by Euroduna.
Citoforte managing director Bent Mahler commented that, "There are many markets in Asia Pacific and beyond, where customers do not yet have access to Euroduna products."
Under their arrangement, Citoforte will manage tie-ups with reputable local partners and Euroduna will provide sourcing and logistics back-up. This tie-up is designed to provide new customers access to Euroduna's extensive ingredients expertise while leveraging the local partners' business operations.

Kemin opens innovation and technology centre in Belgium

During its 50th anniversary celebration, Kemin announced the opening of a new innovation and technology centre in Herentals, Belgium.
The new facility gives Kemin an additional 1,700 square metres of lab space where future innovations for the animal production industry are being worked on. The new facility also houses Kemin's Product Application Department, which supports innovation across departments for increased efficiency.
"This new innovation centre exemplifies Kemin's commitment to continuously provide new molecular solutions to customers," said Athanasios Katsanos, president of Kemin Industries' AgriFoods division in Europe.

Cargill, Louis Dreyfus end CLD joint venture

Cargill and Louis Dreyfus Commodities announced that they will end a joint venture that operates grain facilities in the Pacific Northwest within the next year.

CLD Pacific Grain, LLC was formed in 2001. The Cargill facilities in the joint venture include an export facility in Portland, Oregon and river facilities in Boardman and Arlington, Oregon; Burbank, Washington; and Lewiston, Idaho. The Louis Dreyfus Commodities facilities in the CLD joint venture include an export facility in Portland, Oregon and a river facility in Windust, Washington. Both companies plan to maintain a presence in the Pacific Northwest grain export business.
"CLD has been a successful business, and we appreciate the work of the CLD team," said Michael Ricks, food grain product line manager for Cargill and a CLD board member. "With the current market dynamics, we wanted to take a new approach to serving the export markets from the Pacific Northwest."
"CLD prospered because of the hard work of CLD personnel," said Erik Anderson, CEO of Louis Dreyfus Commodities North America and a CLD board member. "Louis Dreyfus Commodities has decided to pursue new ways to work with growers and customers in the Pacific Northwest export markets in a continuation of our long and successful relationships."
Over its ten year life, CLD has handled a variety of grains including soft white wheat, dark north spring wheat, hard red winter wheat, club wheat, hard white wheat and barley. The grains were exported primarily to Asia.

Merck renames its animal health division

Formerly known as Intervet/Schering-Plough Animal Health, Merck has renamed its animal health division. It will henceforth be called Merck Animal Health in North America and be known as MSD Animal Health outside the United States and Canada.
This name change follows a joint announcement in March 22 by Merck and Sanofi-Aventis that terminated their plans to form a new animal health joint venture. The increasing complexity of implementing the proposed transaction made the two companies to call of the They mutually decided to discontinue their agreement primarily because of.
"The name change reflects Merck's commitment to animal health and its complementary role to the overall business," said Raul Kohan, President of Merck Animal Health. "We aim to generate additional value and sustained growth by continuing to provide integrated solutions with innovative animal health products and services to meet the evolving needs of our customers." 

Rising pork prices trim Yurun's profits

Yurun Food Group Ltd, a major supplier of meat products in China's market, reported a "slight decrease" in its gross profit margin in the first five months of this year, following a record plunge in its stock value.
The lower profits were due to rising production costs, as its sales had "significant growth" in the period up to May 31 compared with 2010, Yurun said in a statement to the Hong Kong Stock Exchange, citing unaudited financial information.
In just 10 days from June 10th to June 20th, the price of marbled pork jumped 4.3%, setting a price record of RMB28.20/kg (US$4.35/kg), China's National Bureau of Statistics said in a June 24 statement on its website.
With feed costs and live hog costs rising faster than pork selling prices, many of China's pork producers are having their gross margins squeezed.

Novus and Verenium announce partnership to expand animal nutrition enzymes
Novus International, Inc. and Verenium Corporation announced a strategic collaboration to expand their range of enzyme solutions for livestock producers and the companion animal market.
"Our partnership with Verenium will allow us to work together to develop and commercialise a suite of new enzyme products for the global animal nutrition and health market," said Thad Simons, Novus International's president and CEO. "These new enzyme products will give us the ability to offer new solutions to the performance challenges our customers face."
Gary Hayen, Novus's global business director for its fermentation products business added that, "This partnership brings together the synergy of both the biotechnology and animal nutrition fields. We really believe we've only started to scratch the surface of the industry's demand for enzymes and are excited to provide innovative solutions, powered by Verenium, to meet the market's needs."
On the other side of this venture, James Levine, Verenium's president and CEO said that, "We are extremely enthusiastic about our partnership with Novus, the potential opportunity it represents for the continued development of our pipeline, and for Verenium to become a more active participant in the animal health and nutrition marketplace with our suite of high-performance enzyme products." 

Betagro expands swine output capacity

To increase its output of premium quality meat for both the domestic and export markets, Betagro Group is investing THB400 million (US$13.3) million to set up four new hog farms in Thailand's Lopburi province.
The group is also seeking land in Chiang Mai to set up a world-class slaughterhouse, which will require an additional Bt350 million (US$11.6 million). At present, the group has only one slaughterhouse, near its main integrated swine facility in Lopburi province.
Executive vice president Nopporn Vayuchote said the new farms will help Betagro achieve a production rate of 800 hogs per day by sometime in 2012. Betagro's swine output capacity is expected to grow to 600 head per day by the end of this year.
The new THB400-million (US$13.3 million) farms will include three parent  hog-breeding farms with a capacity of 40,000 head and one 24,000 head capacity pig-fattening farm. When fully operational, they will double Betagro's parent breeding stock inventory to 80,000 head.
 Nopporn said that, "We are stepping forward to ensure hygienic meat," adding that production from the new farms would be for export only.
Kriengmas Punchai, senior vice president for swine integration, said Betagro's pig business generated an average of THB4 billion (US$ 133 million) per year, including parent breeding stock, fresh meat and processed pork. Of this, exports accounted for THB500 million (US$16.7 million) or 12.5% of total revenues.
Betagro also plans to increase pork sausage output capacity from 300 to 800 tonnes by next year.
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