June 20, 2017
FEFAC: EU compound feed production grows by +0.4% in 2016
According to data provided by FEFAC members, compound feed production in the EU-28 in 2016 reached 155.4 million tonnes which is 0.4% more than in 2015.
Poultry feed has seen its production grow by 2% whereas pig feed fell by 1% and cattle feed remained stable.
For pig feed, following two years of moderate growth, production decreased by 1% in 2016. This is partly attributed to the impact of African Swine Fever in Eastern Europe which significantly affect pork production. Low market prices is also blamed, specifically in the first half of 2016. Nevertheless, large availability of feed grade cereals at low prices benefitted on-farm mixing.
The situation contrasted throughout Europe for cattle feed. The Netherlands and Poland have seen their production of cattle feed increased by more than 8% while France moved in the opposite direction, reflecting the diverging national milk production following the abolishment of dairy quotas.
Finally, despite the avian influenza outbreak impacting several poultry-producing regions of Europe, poultry feed production performed rather well in 2016 and confirmed its position as the leading segment of EU industrial compound feed production, placing ahead of pig feed.
For the third year in a row, Poland was one of the best performing countries, with annual growth of more than 4.7%. The growth was boosted by the demand for poultry feed (+6%) which has turned Poland into the largest poultry-producing country in the EU. The country also saw a +8% growth in cattle feed.
Among other large, producing EU countries, Italy, the Netherlands, and Spain recorded positive results (+1.0/1.5%), whereby Germany remained stable. France has seen its production falling by 3% to 4% in all segments, as a result of shrinking dairy production following the withdrawal of the dairy quotas, or the impact of the AI in the South of France in particular.
However, France remains in third position in terms of total compound feed production, although the gap with second-placed Spain has widened significantly.
Germany remains the top producing country.
Forecast for 2017
FEFAC market experts are relatively prudent concerning industrial compound feed production in 2017.
The dairy sector is still recovering from a severe milk price crisis, which will likely affect dairy herds for 2017. National adjustments to meet environmental criteria could also influence the progress of the industry.
These developments may lead to a reduction of cattle feed production by 0.5%. The expected stabilisation of pork production in Europe could induce a moderate reduction in demand for pig feed (-1%).
Poultry exports will continue to be affected by avian influenza, thus exerting pressure on EU poultry production and, subsequently, the feed segment (+0%). Overall, this would lead to a 0.5% decrease in compound feed production in 2017 versus 2016.
A number of parameters will evidently affect this outlook. The evolution of outbreaks of avian influenza and African Swine Fever will be decisive, in particular in terms of EU export capacities preservation.