January 25, 2016

 

2016 seen as bad year for compound feed millers
 

 

Market experts from the European Feed Manufacturers' Federation (FEFAC) foresee a decrease in industrial compound feed production this year due to a generally depressed EU livestock market.

 

While they foresee the upward trend on poultry feed demand to persist, although at a lower pace of 1% than in 2015's 2%, they expect a significant reduction in pig feed demand (-2 to -3%), in line with expert forecasts on pigmeat production in the EU. Last year industrial pig feed production was the same as in 2015, at 49.2 million tonnes.

 

In the case of cattle feed, a 1% decrease is expected again this year as the weather conditions have been favourable to forages in Northern Europe so far, which should weigh on the demand for the feed.

 

Overall, compound feed production would decrease by 0.5% in 2016 compared with 2015, FEFAC said.

 

FEFAC cited several factors that may still alter the picture including the impact of El Niño in the Southern Hemisphere, the risk of rain deficit in South Europe, disease outbreak threats (avian influenza, bluetongue, African swine fever).

 

On the other hand, it added, the ongoing negotiations with Russia on sanitary aspects, if concluded positively, could reactivate exports of certain pig products to Russia and alleviate the pressure on the pigmeat market.

 
 

2015 better year

 

Comparatively 2015 was a better year as compound feed production in the EU increased .2% from the previous year to an estimated 156.1 million tonnes, according to data provided by FEFAC members.

 

Industrial pig feed production remained stable in 2015, at 49.2 million tonnes from the same level in 2014.

 

Industrial cattle feed decreased by 1% to 42.1 million tonnes from 42.5 million tonnes in the previous year.

 

Poultry feed production increased by almost 2% in 2015 to 52.7 million tonnes, boosted by an increasing per capita consumption of meat. Poultry feed consolidated its position as the leading segment of EU compound feed production, now well ahead of pig feed.

 

Feed costs remained low in 2015 and even decreased compared with 2014, due to a good 2015 cereals harvest in the EU and a largely sufficient supply of oilseed meals globally, especially soybean meal, FEFAC said.

 

Feed quotations have been on the downward trend since 2013 and the good global 2015 grain and oilseed harvest is expected to maintain this trend in the beginning of 2016. However, FEFAC said prudence is required, with uncertain impact of the drought in Northeastern Brazil on 2016 soya harvest.