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GLOBAL

FEED PREMIXMARKET

Market Shares, Forecasts& Trends

2014 - 2020

mordorintelligence.com

Mordor Intelligence | 1 Global Feed Premix Market | Sample

1.1 Methodology

In the primary research process done for this research study, the sources – industry experts

such as CEOs, Vice Presidents, Marketing Directors, Technology & Innovation Directors and

related key executives from various key companies, organizations in the global animal feed

premix industry and related industries such as compound feed and feed additives industries,

have been interviewed to obtain and verify both qualitative and quantitative aspects of this

research report.

In the secondary research process for this study, several hundreds of secondary sources

such as certified publications, articles from recognized authors, white papers, annual reports

of companies, directories, and databases were used to identify and collect information

useful for this extensive technical and commercial study of the global market. Secondary

research was mainly used to obtain key information about the industry’s value chain,

market’s monetary chain, total pool of key players, the end-user consumption for each

premix type, market classification & segmentation, geographical markets, and key

developments from both market and technology oriented perspectives.

Top-down and bottom-up approaches were used extensively along with several data

triangulation methods to perform market estimation and market forecasting for all the

segment and sub-segment markets listed in this report. Extensive qualitative and further

quantitative analysis was also done from all the numbers arrived at in the complete market

engineering process, to list key information throughout the report.

Mordor Intelligence | 2 Sample | Global Feed Premix Market

1.2 Definition of the market

Feed premix is a uniform mixture of one or more micro-ingredients such as vitamins,

minerals, amino acids with a diluent and/or carrier. Premixes are used to facilitate uniform

dispersion of micro-ingredients in a larger mix. Manufacturers supply premixes to assure

regular uniform supply of nutrients to the animals, enhance the quality of feed and

productivity of the animals. This research report provides in-depth market intelligence on the

global feed premix market, which is currently witnessing steady growth due to an increasing

scope of applications in the livestock industry. The end consumers of feed premix are

compound feed manufacturers, integrators, farmers, home-mixers, the livestock and

aquaculture industries. Scientific evidence may help the feed premix sector gain

considerable market share in the future. This would be possible by increasing the

investments in R&D and cost management, coupled with information flow regarding the

nutrient requirements of animals. Adoption rate among farmers and meat producers, and

pricing and availability of raw materials, have brought about changes in the feed premix

market in terms of formulations, usage and production priorities.

This report takes into account this wide range of factors and their influence on the market

dynamics. This research report categorizes the global feed premix market on the basis of

ingredients, animal type and geography, forecasting revenues and analyzing trends in each

of the following submarkets:


Ingredients Animal Type Region

Antibiotics Ruminant North America

Vitamins Swine Europe

Antioxidants Poultry Asia-Pacific

Amino Acids Aquaculture South America

Minerals Others Africa

Others

ASSUMPTIONS

• All USD exchange rates are as of 2013. Final exchange rate for a year is arrived at by

taking an average rate as on January 1 and July 1 for that particular year.

• Inflation is not a part of pricing and price has been kept constant throughout the

year to determine market revenues.

• Market size for various countries has been estimated on the basis of regional

consumption.

• Europe includes Western Europe (including EU and non-EU members), Central, and

Eastern Europe.

• All market revenue figures have been calculated on the basis of sales, prices at the

suppliers’ side and consumption trends.

• All existing major applications are considered and potential applications are

estimated on the basis of feedback from primary respondents.

• The numbers may not match up due to rounding off at subsequent levels.


Executive Summary

The global feed premix industry is in a nascent stage and is expected to grow at a steady

rate till 2020. This growth is largely fuelled by the increasing meat consumption and rising

concern over its quality and safety. Growth is particularly high in emerging countries such

as China, India, and Brazil because of increasing income levels and rising per capita meat

consumption. Some major drivers of the feed premix industry identified in this report are rise

in global meat consumption, increasing awareness towards meat quality and safety,

increasing mass production of meat, and recent livestock disease outbreaks. The increasing

trend of on-farm mixing in North America is driving the market for feed premix, although the

impact created by it is less on the global market. Major restraints identified in this report are

regulatory structure and intervention, and rising raw material costs.

The global feed premix market revenues are estimated to grow at a CAGR of 3.1% from 2014

to 2020. The Asia-Pacific market is driving growth and is expected to hold 32% of the global

market revenue by 2020. The Asia-Pacific market is expected to have a high CAGR of 3.4%

due to increasing demand for meat products in the region and rising domestic meat

production. With rapid economic growth in the region, demand for meat protein is rising,

especially in China, India, Malaysia and Thailand. North America is a matured market, with a

28% share in 2013, resulting from increasing per capita meat consumption and rise in on-

farm mixing. In North America, the United States is the largest market with a revenue share

of around 70%.


The report has been further segmented on the basis of feed premix consumption in different

livestock. It includes swine, ruminants, poultry, aquatic animals and others. It is identified

that the poultry market has the largest market share of 42% as the adoption of intensive

farming system in the poultry segment is more than in any other livestock segment. Another

major reason for growth of the market is high slaughter head count resulting from

increasing preference towards poultry in different parts of the world including India, the U.S.

and Europe.

The market is segmented based on the use of additives in compound feed. Vitamins premix

accounted for the largest market share of 35% in 2013 and is estimated to be the fastest

growing segment. Major companies are analyzed in terms of strategy adopted, financial

revenues and their recent developments in the global feed premix market. Some of the

major players covered include Cargill Inc., Charoen Pokphand Foods, Archer Daniels Midland

Company, Nutreco N.V., Evialis, Land O Lakes Feed, De Heus, etc.

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3.1.1 Feed Price trend Analysis

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Intensification of livestock production and increased awareness about nutrient requirements

have increased dependency on commercially manufactured compound feed. The price of

manufactured compound feed, while varies widely by region, ranges from a few hundred

dollars to over $1000/ton depending on the species being fed. Compound feed prices have

been on the rise over the last decade, increasing by around 40% in just the last 5 years.

Increasing costs of ingredients, shortfalls in local supplies and rising oil prices will sustain

this price trend, constraining farmers from using commercial compound feed especially

when market prices of meat and dairy products fall.

Price Trends - Ruminant Feed, Swine Feed & Poultry Feed

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Source: OECD, FAO, FAPRI & USDA

0

100

200

300

400

500

600

2006 2007 2008 2009 2010 2011 2012 2013

Pri

ce

pe

r to

n (

US

$)

Ruminant Feed Swine Feed Poultry Feed


4.1.4 Amino Acids

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Amino acids are provided to livestock for proper growth and development as they are the

building blocks of protein. Major types of amino acids provided to animals through premixes

and compound feed are lysine, methionine, threonine, tryptophan, arginine, histidine, leucine,

isoleucine, phenylalanine and cysteine. Amino acids enhance the quantity and quality of

meat by ensuring optimal animal performance via feed intake and weight gain. Consumption

of amino acid feed additives and premixes has been on the rise in Asia-Pacific and Latin

America. Major markets such as China and India are also getting the benefit of low cost

because of increasing domestic production of amino acids, especially lysine. In the future it

is expected that amino acids will gain more importance as producers are opting to reduce

feed resources waste to make animal production systems environmentally compatible.

Amino Acids: Feed Premix market Volume, by Region, 2012-2020 ('000 Metric Tons)

Region 2012 2013 2014 2020 CAGR% (2014-2020)

North America XX XX! XX! XX! XX!

Europe XX! 121.4 XX! XX! XX

Asia-Pacific XX! XX! XX! XX! 3.0

South America 35.0 XX! XX! XX! XX!

ROW XX! XX! XX! 12.7 XX

Total XX! XX! XX! XX! XX!

Source: All About Feed Magazine, The poultry site, The fish site, Primary Interviews, IFIF

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Amino Acids: Feed Premix market revenue, by Region, 2012-2020 ($Million)

Region 2012 2013 2014 2020 CAGR% (2014-2020)

North America XX XX! XX! XX! 2.9

Europe XX! XX! 118.9 XX! XX!

Asia-Pacific XX! XX! XX! XX! XX!

South America XX! XX! XX! XX! 2.4

ROW XX 10.8 XX! XX! XX

Total 525.1 XX! XX! XX! XX!

Source: All About Feed Magazine, The poultry site, The fish site, Primary Interviews, IFIF

!Lysine supplementation facilitates high growth rates, and limits pollution from nitrogen

excretion. It is important in the development of collagen and in ossification. Other amino

acid segments are tryptophan, methionine, and therionine. These amino acids are made

available to the animals in the form of premixes or via compound feed.

The consumption of premixes is more in North America due to the trend of on-farm mixing.

Asia-Pacific is a potential high-growth market with increasing awareness among the farmers

about the benefits of feed additives and feed premixes. However, the high cost of premixes

is an obstacle in the growth of the market. Adoption of modern feed management

techniques is accelerating the consumption of compound feed, feed additives and feed

premixes in Asia and South America.


4.2.3 Poultry

!Poultry meat consumption is devoid of any religious impact, and as a result, is the largest

meat segment in the world. Global poultry meat consumption is expected to grow at a CAGR

of 4.7% between 2014 and 2020. A major reason for the surge in demand for poultry meat is

the increased consumption of processed poultry in Asian countries. Such a growth in

consumption has pressurized farmers to maintain production growth rate relative to

consumption to retain the demand-supply balance. Rising health awareness among

consumers has necessiated the production of high quality meat and faster, especially in

developed countries. All these reasons have created a platform for the compound feed and

feed additives market to enhance the quality and efficiency of feed, ensuring better quality

meat production. Millers and livestock producers are switching to feed premixes to maintain

uniformity in the feed and meat.

Poultry: Feed Premix market Volume, by Region, 2012-2020 ('000 metric tons)

Region 2012 2013 2014 2020 CAGR% (2014-2020)

North America XX XX XX 703.7 XX

Europe XX 386.9 XX XX XX

Asia-Pacific XX XX XX XX XX

South America 209.7 XX XX XX XX

Africa XX XX XX XX 1.8

Total XX XX XX XX XX


The feed premix industry is in the introductory phase in Asia and South America, and growth

of the market is forecasted to be faster here than in developed countries. The poultry

industry in these countries also benefits from lenient feed related regulations.

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Poultry: Feed Premix market revenue, by Region, 2012-2020 ($Million)

Region 2012 2013 2014 2020 CAGR% (2014-2020)

North America 714.9 XX XX XX XX

Europe XX XX XX 598.2 XX

Asia-Pacific XX XX XX XX XX

South America XX 321.8 XX XX XX

Africa XX XX XX 73.1 XX

Total XX XX XX XX XX

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The market for feed premixes in North America and Europe is in the growth stage and

accounted for a 60% share in the global poultry feed premix segment in 2013. Regulatory

concerns over feed inputs in poultry and increased stress on food safety due to recent

disease outbreaks such as the avian flu, are major factors driving demand in these regions.

Asia-Pacific is the fastest growing market due to increasing consumer preference for poultry

meat. Consumption is particularly high in countries such as China, India and Thailand

because of rising incomes of their middle class populations, availability of poultry meat at

cheaper prices due to production cost benefits, and strong export demand. Industrialization

of the meat industry in Brazil is a major reason for growth in the South American poultry

feed premix market.


6.2 Feed Premix Market Share Analysis (2013)

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The global feed premix market is held by four key manufacturers on one end while the rest

of the market share is taken by small companies. DSM N.V. and Nutreco N.V. are the market

leaders with a combined share of around XX%.

Feed Premix Market Share Analysis - 2013

Source: Company Annual Reports, Mordor Intelligence Analysis

Other players include Cargill Inc., Evialis and ADM, among others. The leading players are

adopting mergers, investments in new production plants and expansions to strengthen their

position in the market. The figure above depicts the shares of feed premix companies as of

2013.

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DSM N.V.

Nutreco N.V.

Cargill, Inc.

Evialis

Others


6.3 Most Active Companies by Market Strategies

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The global feed premix market is highly concentrated, with a few large players acquiring

nearly 50% of the market share. These major players are investing in new plant

establishments and in mergers & acquisitions of major players in foreign markets for

business expansion. Another major area of investment is the focus on research and

development to launch new products at prices cheaper than competitors.

Global feed premix market growth strategies, by companies, 2010 – 2013

The figure depicts the most

active players with their share

in overall developments in the

global feed premix market.

Nutreco N.V. has shown an

aggressive approach to gain a

competitive edge in the

market, with XX% of the total developments in the industry from 2009 to 2014. Mergers and

Acquisitions is the most adopted strategy by Nutreco N.V. Cargill and DSM hold XX% each of

the total developments in the market. Investment and expansion have been the most

adopted strategies of Cargill Inc. The company is investing in new production plant facilities

both in domestic as well as foreign markets to cater to increased demand from the

compound feed and livestock industries. Investments, expansions and partnerships are

strategies DSM adopted to acquire a leading position in the feed premix sector. Other active

participants in the market are ADM, Novus International and BASF SE.

DSM N.V.

xx

xx

xx

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