September 17, 2008

Compound animal feed production in the EU should settle in 2008 after last year's exceptional output saw the highest growth rate in 20 years, EU industry federation FEFAC said on Tuesday (September 16, 2008).

EU manufacturers produced 149.8 million tonnes of animal feed in 2007, around 3.4 percent higher than in 2006; with cattle feed seeing the most significant year-on-year increase.

Farm animals in the EU consume roughly 470 million tonnes of feed each year, of which 150 million are produced by compound feed manufacturers.

The main reason for the EU's record feed output in 2007 was that high cereals prices encouraged farmers to place their grain on the market rather than mixing them into feed for their farms.

FEFAC Secretary-General Alexander Doering said that some are starting to rethink that strategy and may turn back to using some of the new crop for home-mixing purposes. If so, that could depress demand for compound feed.

He added that it's still early but it would be the logical consequence if cereal prices stay on a lower level compared with last year.

High cereals prices last year also encouraged farmers to use the most cost-efficient, industrial compound feed for their animals, particularly in the pig sector, FEFAC says.