January 7, 2014
Diamond V: 70 years of expertise in animal nutrition and health
An eFeedLink Exclusive
Diamond V is an innovative American company that has become a global leader in animal nutrition and health. Dr Mark Kujawa, Diamond V's vice president of international business development and Michael Wright, its global marketing and research director, discuss the company's achievements and future development.
by YANG Yang
Along with a growing world population, rising incomes are boosting per capita meat consumption and creating demand for safer, higher quality meat. Simultaneously, with increasing concern about the use of antibiotics, livestock producers are seeking alternatives to maintain animal production efficiency while delivering similar benefits offered by antibiotic growth promoters (AGPs). This has created huge opportunities for the feed additive business. According to a report by Global Industry Analysts, Inc. (GIA), the global market for animal feed additives is estimated to reach US$26 billion by 2018.
As a manufacturer of nutritional fermentation products with a commitment to innovation, technology and quality, Diamond V has earned a reputation of trust and reliability in the animal feed industry.
Founded in 1943 by C.W. Bloomhall and currently helmed by John C. Bloomhall, Diamond V has maintained its position as a global leader in the animal health and nutrition business through three generations. Even though its facilities, product portfolio, manufacturing technology and services have expanded through seven decades of development, the company's tradition of quality, value and purpose has stood firm.
An evolving business
Over the past 70 years, Diamond V has marked a number of key milestones, the first of which was the creation of a proprietary anaerobic fermentation technology platform. With a consistent focus on microbial-based fermentation research and technological innovation designed to promote animal health and performance, Diamond V has established its core Original Product Line of all-natural, fermentation-based feed additives.
The company's fermentation technology delivers a stable product, which will not be affected by extreme temperatures, pH levels or processing, therefore ruling out the need for special storage. And unlike many single-type compounds in the marketplace, the company's product is composed of numerous metabolites designed for animal health and performance.
This has defined the product's status as one of a kind in the market. "Diamond V fermentation metabolites are unique in the world," says Michael Wright, director of global marketing and research. "There are no similar types of products."
Backed by its technological strength, Diamond V's market share has increased over the years. Established as an US company selling to America's feed industry, Iowa-based Diamond V quickly expanded its business and is now selling products to most countries around the world.
To meet growing global demand for its products, the company is enhancing its production capacity with the addition of a state-of-the-art manufacturing facility in Iowa. "Our capacity in Iowa is doubling as we speak," says Dr Mark Kujawa, Diamond V's vice president of international business development.
After expanding outside the United States, Diamond V's market focus evolved in response to the livestock needs of various countries: It now offers supplements for swine, poultry, beef and dairy cattle, as well as aquaculture. If Diamond V was focused on animals in general before, it is now focused on products, people and resources by species.
For many years, Diamond V's focus in the United States had mostly been on the dairy business, and the company continues to demonstrate its strength in this area. In July this year, the US Food and Drug Administration (FDA) granted Diamond V Original Product the functional claim that it "helps support the dry matter intake (DMI) of dairy cows when fed as part of a total mixed ration during the first 70 days of lactation", making Diamond V the only company in the category with an FDA-accepted functional claim for DMI.
The FDA functional claim is an indication of the company's commitment to research, and has won praise from the director of North American Dairy, veterinarian Gerald Poppy. "Too often in our industry, products are sold without employing a peer-reviewed research process. This leaves a dairy producer or dairy professional guessing as to whether or not the products will work as presented," he says. "In contrast, Diamond V leads by investing in peer-reviewed research, which can support an application for an FDA functional claim."
By leveraging its fermentation expertise and through extensive research, the company has found new ways to provide value for swine and poultry producers, and more recently, aquaculture. Furthermore, by expanding the range of organisms used in its anaerobic fermentation technology platform, Diamond V added a new line of organic selenium products, including SelenoSource® AF, DiaMune® Se, and SynGenX™.
While SelenoSource® AF is a premium source of selenium that provides essential nutrients for livestock and poultry, DiaMune® Se combines the organic selenium source with the Original Product™. "The advantage of the DiaMune® Se products is that it contains benefits of both organic selenium and Diamond V's fermentation metabolites in one product," comments Wright.
With fermentation metabolites produced by non-yeast microorganisms under controlled conditions, SynGenX™ is a new concept that Diamond V has developed, signifying the company's reputation as a science-based feed ingredient supplier. Targeted at the nursery pig feed market, SynGenX™ naturally supports digestive and immune system health by promoting a healthy balance of beneficial bacteria in the pig's gastrointestinal tract. By increasing feed intake and encouraging better feed conversion, SynGenX™ helps pigs gain weight faster.
With the addition of a new line of organic selenium products, Diamond V is diversifying its product portfolio. "Using our fermentation technology, we are able to create one of the highest-quality organic selenium product lines in the world for livestock," Wright says.
While Diamond V has made headway in the animal health business, the company has opened a new front in human health with the introduction of a new group - Embria Health Sciences, raising the stakes in the human dietary supplement market. As an extension of its core fermentation technology, the company has developed the EpiCor® human dietary supplement. Sold to other manufacturers as a raw material, EpiCor® can be added to vitamins, supplements, and energy sports drinks and other consumer products.
Rising to livestock industry challenges
Despite the progress made in the technology to treat animal diseases, the potential threat of new diseases, or of old diseases re-emerging in new, more virulent strains, present new challenges to all livestock industry lines.
Traditionally, health problems with livestock are treated with antibiotics. In United States and many other parts of the world, they are also used as antibiotic growth promoters (AGPs), which have become a major concern everywhere as they could adversely impact human health and the environment in general.
Consequently, there has been a shift in attitudes towards the use of AGPs, as people realise the danger associated with them. Since 2006, the European Union has banned the use of AGPs, as did Japan and South Korea a few years later.
In the United States where it is a common practice of using the "wonder drugs of the 20th century" to accelerate the growth of livestock, a reversal of the trend is taking shape. On December 11, 2013, FDA announced a new policy to restrict the use of antibiotics in animals raised for meat, symbolising the serious effort by the US government to curb the overuse of AGPs in the county's livestock industry. Hence, the way antibiotics are used in livestock is changing out of concern about food safety and human health.
Although antibiotics cannot be totally replaced, their usage can be minimised with the introduction of more natural alternatives. "Most professionals in our business agree that there is a real need for the correct use of antibiotics. We all want to try to reduce the overuse of antibiotics but still use them in the right way," Dr Kujawa notes.
"How can we as an industry provide efficient food production through animals at the lowest possible cost, yet have healthy animals? That means trying to develop a more balanced use of antibiotics," he adds.
Diamond V's Original Product Line is able to help balance the animal's immune system. "An efficient immune system requires energy to be activated, fight off disease, and help minimise the impact of disease," Dr Kujawa comments.
A number of research studies have shown that the Diamond V Original Product Line supports the immune system health by promoting better balance and efficiency, enabling the animals to use less energy and be more effective in fighting diseases. With healthier animals, farmers depend less on antibiotic treatments, thus reducing both the use of antibiotics and livestock treatment costs.
On one hand, fierce competition and volatile markets are driving livestock producers to push costs down while maintaining production. On the other hand, the cost of animal feed inputs has risen dramatically over the past few years. This motivates livestock producers to use lower-cost, alternative ingredients but also creates concerns about the efficiency of animal production.
With aquaculture in particular, Diamond V has clearly proven that the Original Product Line improves diet digestibility while maintaining low mortality. In beef cattle, research meta-analysis conducted by John Wagner, professor of Animal Science at Colorado State University, has found a positive effect on average daily gain (ADG), feed efficiency and carcass quality grade, when Original Product was fed throughout the entire feeding period.
Key trends in the animal nutrition industry
Shedding light on the market trends, Dr Kujawa points out that customers are becoming increasingly demanding, as farm technology is changing rapidly. With farm equipment becoming more affordable and more widely available, livestock producers can accurately measure how livestock performance responds to changes in feed composition or livestock management.
Coupled with this technological trend, new regulations that require the measuring of bacterial loads at farms and during food processing are changing the competitive landscape.
"Knowing when bacterial levels become unsafe is huge for the business," says Dr Kujawa. "Knowing when it becomes unsafe in advance of the problem is important, so we can make a change."
For Diamond V, that is certainly good news. By showing farmers when and how to use products for optimal results, the company can help farmers and food processors recognise the benefit of higher-value products. When technology empowers farmers and processors to accurately measure their impact, they can make better-informed buying decisions.
In addition, food safety now carries a high level of interest, as livestock producers and food processing companies are looking at all parts of their business to reduce food-safety concerns. For example, in the swine and poultry sectors, there is growing demand for effective solutions that will lower the probability of a salmonella outbreak.
Dr Kujawa believes that Diamond V's Original Product Line can be part of an effective overall food-safety programme, with a start in animal production. And he has concrete scientific evidence to back up this claim.
In a research using an in-vitro poultry intestinal model, results indicated that Original XPC™ may have preferentially shifted poultry intestinal microbial fermentation towards suppressing the growth of pathogens Salmonella Arizonae (SA) and Salmonella Heidelberg (SH).
In a similar vein, researchers investigating the individual and combined effects of feeding Diamond V Original XPC™ (a Saccharomyces cerevisiae fermentation product) and Salinomycin (an anticoccidial) concluded that it can help prevent coccidosis in broilers.
With a presence in over 45 countries, Diamond V's current growth pillars are Southeast Asia and China, complimented by large potential in Brazil and steady growth in Europe.
Today, Southeast Asia and China have the world's fastest-growing economies. East Asians are using their rising personal incomes to make more selective and sophisticated food buying decisions. As they boost their per capita consumption of various protein lines, this creates strong, rapidly growing demand for safe, high-quality meat, milk, eggs and fish. "That demand makes the market exciting," says Dr Kujawa. "Southeast Asia and China are where the current opportunity is."
Diamond V is also exploring emerging markets that are just as promising as East Asia but at an earlier stage of development, with much attention being given to Russia and India.
Though entry barriers to Russia are high, Russian agribusiness has shown interest in high-quality products and services. Despite the fact that it can be hard to work within the system, Dr Kujawa is optimistic about the prospects in that market, "Russia is what China was 50 years ago, but things always change."
As for India, Dr Kujawa expresses confidence in this large and diverse country's potential, commenting that, "It is poised to become another China, in my opinion, for animal business."
Of course, Diamond V faces strong and aggressive competition from other manufacturers of animal nutrition and health products around the world, with many functional ingredient companies competing for market share.
Besides producing a product that cannot be replicated by other manufacturers, Dr Kujawa mentions another edge of Diamond V, "Without doubt, it is the quality of our people here and around the world," he says. "We spend a lot of time finding the right people, training them, and continuing to invest in their technical expertise."
With their technical competence, Diamond V's staff is able to communicate with farmers, processors, feed millers, and nutritionists at different levels of scientific detail and understanding. "It takes skills to communicate at different levels of language and effectively communicate, to get the idea across," Dr Kujawa says. "It's not only having answers, but also being able to clearly communicate the answers to whomever you are talking with."
Speaking of the future development of Diamond V, Dr Kujawa says the company is driving business by bringing offices and services geographically close to its customers. "Being close is very important. Customers can't realistically travel halfway around the world to visit a Diamond V office," Dr Kujawa explains. "To understand our customers' needs, cultural differences, and their businesses, we must be where they are."
To better understand individual business, preferences, as well as specific issues and come up with customised solutions, the company has a network of experts to provide on-farm support, including sales professionals, nutritionists, veterinarians, researchers and experts in risk management.
"We share information in various ways. We communicate electronically, we are in trade publications, we publish in scientific journals, and we have technical experts at numerous trade shows. But nothing beats one-on-one conversations in my opinion," Dr Kujawa adds. "We are in a technical business, and our customers -feed millers and farmers- want new ideas and cost-effective solutions from us."
Although Diamond V has extended its product lines, expanded far beyond the United States and entered many new markets, the company's main focus has stayed the same: Using its exclusive fermentation technology platform to produce the highest quality fermentation-based products backed by scientific research. "That's part of the company's culture, the way we have always done business and continue to do business," says Dr Kujawa.
"By our business model, our design, we've been focused on animal nutrition and health," Dr Kujawa elaborates. "We are not a division of another company; we are not owned by another company; we don't have a distracting side business. We are singularly focused on improving animal production to help feed the world."
Concluding with the philosophy of Diamond V, Dr Kujawa continues, "From the beginning, Diamond V believed that if you are going to do something, do it correctly, and do the best that you can. That is the philosophy of our people, our company."
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