The search for vegetable proteins
All the world’s inhabitants are eating increasing amounts of animal proteins, including meat. Animals need vegetable proteins in their feed in order to produce that meat. Can the supply of proteins for animal feed keep up with demand in the next ten years? Clara van der Elst, analyst at Rabobank Food & Agribusiness Research, has been studying this essential question for the food supply.
If there are no vegetable proteins for animals, there will be no meat, no eggs, no fish and no milk for people. Just like people, animals need good food. Energy and proteins are the main elements of good animal feed. Energy requires raw materials that are different from those needed for proteins. Maize, wheat and other grains are the main sources of energy for animals. What about proteins? Cattle get protein from grass, however pigs and chickens depend mainly on soybean meal for their proteins.
Demand for proteins for animal feed continues to grow
In the past ten years, the amount of proteins needed for animal feed has risen by more than 50 percent to over 250 million tonnes. Prices also rose strongly until the end of 2014. The growth in volume will continue, according to Rabobank analyst Clara van der Elst. The global demand for vegetable proteins for animal feed will be 90 million tonnes (or 37 percent) higher in 2023 than it was in 2013.
These figures are the product of a calculation model used by Rabobank Food & Agribusiness Research. The model predicts the global need for livestock feed on the basis of a whole series of data. This is not restricted to the expected production volumes for beef, pork, poultry and eggs for example. The model also calculates the efficiency with which an animal converts feed into growth.
The model is important for information on global food supply and is directly relevant for Rabobank customers in the livestock farming business, for instance. Forty percent of the more than 90 billion euros that Rabobank has outstanding in the global food and agri sector concerns the production of animal proteins.
Trend towards poultry
The fact that the world’s inhabitants collectively are increasingly eating meat, fish and dairy products is the main cause of the increased demand for proteins for animal feed. For instance, global consumption of chicken meat amounts to more than 110 million tonnes a year, more than 50 percent higher than in the year 2000. Van der Elst: ‘People outside Europe and America are eating more meat, especially chicken, fish and shellfish. In the western markets, where meat consumption is declining, there is a shift away from pork and beef to chicken and fish. Both chickens and fish convert feed into meat faster and more efficiently, but they need feed with more proteins.’
Urbanisation leading to demand for better and safer meat
The modernisation of livestock farming is also an important factor. Globally, 65 percent of livestock farming is now provided by what are called modern companies, the type of livestock farming that is common in North America, Europe, Australia and New Zealand. The rest of the production, mainly in Asia and Africa, is still coming from traditional, small family businesses. Animals are fed what is locally available and waste, including food waste and offal. In many cases, they are not giving their animals enough protein. Van der Elst: ‘The increased urbanisation is leading to increased demand for better quality and safer meat. Farmers are therefore moving to modern feed, which mainly consists of soybean meal and maize. Mainly as a result of this modernisation, every kilo of animal protein will need more grams of vegetable protein in the future.’
‘Mainly as a result of modernisation, every kilo of animal protein will need more grams of vegetable protein in the future.’
Limits to growth
Can production of vegetable proteins for animal feed increase? Van der Elst states that this is possible, but there are limits. Firstly, only certain crops provide these proteins. Secondly, increasing the area for cultivation or achieving higher returns per hectare cannot be achieved without attention to sustainability issues, such as the right to land of the original inhabitants and the retention of biodiversity.
Improve conversion of feed into meat
Which strategies can food and agri companies use to address the opportunities and risks that arise? According to Van der Elst, the first is the importance of research, development or technology, for example in the composition of feed, improved feed conversion into meat and the development of alternative feed proteins. Van der Elst: ‘The second key to success is to design business strategies more on close cooperation and potential integration of companies that operate in adjacent positions in the supply chain.’
Can we expect anything else? Van der Elst stresses the importance of the search for alternative sources of protein, in which Rabobank is engaged as well. Think of food waste and offal for instance, which is no longer fed to animals. ‘Food waste and offal can work as nutrients for algae, duckweed or insects. And these in turn are important sources of protein.’
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