News 319 views last update:7 Aug 2012

EU-compound feed production in decline

In 2006, the compound feed production for the EU-25 reached 143.2 million tonnes (mt), which is 0.2% below the figure for 2005 (143.5 mt). The ten new EU member states account for around 16.0 mt.

The figure includes an estimated amount of 1.5 mt, being the production for Malta, Luxembourg and Greece.

As expected, the poultry feed production was affected in the first half 2006 by the severe drop in poultry consumption due to consumer concerns regarding the Avian Influenza outbreak.

Strong drop in poultry feed
The consequences in terms of total compound feed volumes remained however relatively limited on a yearly basis (-4%), thanks to effective risk management efforts by authorities and operators of the poultry chain.

Mediterranean countries registered the most important decreases with -6% for France, -8% for Italy and -9% for Spain. Among the top poultry feed producing countries, Poland is the only one showing a positive development with almost 7% production increase and this for the second year in a row.

Cattle feed on the rise
The demand for cattle feed increased slightly (+1%) with very contrasting developments: after three years of serious drought, the agronomic conditions improved considerably in 2006 in the Iberian Peninsula. This resulted in a better roughage harvest and, therefore, in a lower demand for compound feed which decreased in Spain and Portugal by resp. 13 and 17%.

In most other countries, the situation was quite the reverse, with a growth between 2% for The Netherlands up to 17% for Ireland and even 20% for Poland.

Pig feed popular again
After several consecutive years of decrease anticipated by experts, the pig production in the 10 new EU member states began to recover, explaining the +7% in pig feed production mostly due to Poland.

The situation is similar in The Netherlands also showing a clear growth in pig feed production in 2006 (+4%), after almost 10 years of steady decrease. On the other hand, pig feed production in Spain decreased by 0.3%, mostly due to lighter carcass weights.

France largest producer
All species combined, France is the first compound feed producing country, ahead of Germany, which recovered its second place from Spain. The Spanish feed industry lost almost 1 mt in 2006 after a spectacular development over the last ten years.

Over the same period, the Dutch feed industry went into the opposite direction with almost 4 mt lost between 1993 and 2003, mostly pig feed, but has stabilised since then.

Germany is the leading cattle feed producer, Spain is now the leader for pig feed and France clearly breaks away from the other countries for poultry feed production.

Outlook for 2007
The key question for 2007 is how the present development of the demand for cereals and oilseeds for biofuel production can affect the livestock sector and the overall EU feed balance sheet.

According to Fefac experts, competition for land has started between grain for biofuel production and roughages for cattle in certain countries such as Germany, which may impact on the demand for compound feed.

Likewise, the spectacular increase in cereal prices in the EU may also encourage farmers to put their cereals on the market and purchase compound feed. This explains why Fefac experts consider that, although roughage resources for 2006-07 should be much better than in the past years, especially in the Iberian Peninsula, the demand for cattle feed should remain stable in 2007.

Pig feed production is expected to stabilise as well: the expected slight development in pork production should indeed be offset by better zootechnical management, in particular better feed conversion rates.

On the poultry side, the Fefac experts anticipate some recovery in poultry feed in particular in Italy, hence a +1% forecast for the EU-25. This would lead to a production of almost the same level as for 2006. The two new EU Member States, Romania and Bulgaria, produce together app. 2.5 mt of compound feed.

Editor AllAboutFeed

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