Market Trends of South America Feed Premix Industry
Growing Compound Feed Industry Fuels Feed Premix Market Growth
Brazil, as South America's largest compound feed producer and the world's third-largest feed manufacturer, maintains its position through abundant raw materials, extensive geographical area, and high domestic meat consumption. The country's total feed production increased from 81.2 million metric tons in 2021 to 81.9 million metric tons in 2022, according to the AllTech feed survey. The growth in industrial meat and dairy production has driven increased demand for high-quality compound feed and feed premix from the livestock industry.
The increasing demand for high-quality compound feed from the livestock industry, driven by expanded industrial production of meat and dairy products, has led to higher consumption of compound feed. The rising demand for premium animal products, including meat, milk, and eggs, is driving the growth of feed premixes. These premixes enable livestock producers to maintain animal health and productivity, ensuring high-quality output. According to the Food and Agriculture Organization, Argentina's per capita consumption of beef and veal reached 34.39 kilograms in 2023, showing a one percent increase from the previous year. This growth in meat consumption increases the demand for compound feed, as livestock require nutritionally balanced diets for optimal growth and health. Feed manufacturers incorporate premixes to enhance feed nutritional content, which improves animal health, immunity, and reproductive performance, contributing to market expansion.
Additionally, the use of premixes streamlines the feed formulation process, improving efficiency and minimizing error risks. This ensures livestock receives specific nutrients required at various growth and production stages. The integration of compound feed and feed premixes enables efficient livestock production, helping producers meet the increasing demand for quality meat products while maintaining optimal animal health and productivity.
Brazil Dominates the Market
The Brazilian feed premix market is expanding due to increased meat consumption, exports, and growing awareness of meat and dairy product quality. The industrialization of meat production has increased the demand for feed premix in Brazil. According to the Food and Agriculture Organization in 2023, poultry remains the most consumed meat in Brazil, with per capita consumption at 29.26 kg, followed by beef and veal at 19.18 kg, and pork at 13.98 kg. This high meat consumption necessitates efficient, high-quality animal feed, including compound feed and feed premixes, to maintain livestock health and productivity while meeting domestic and international market standards.
Besides, the Brazilian Central Bank (BCB) projects a moderate economic outlook for 2023 with a GDP growth of 2.56 percent and an inflation rate of 4.92 percent. Social aid programs targeting the most vulnerable segments of the population and a rise in the minimum wage are poised to bolster domestic meat consumption. These economic enhancements have notably uplifted the purchasing power of many Brazilians, leading to a surge in chicken meat consumption. Chicken, being the predominant animal protein in Brazil, often serves as a more affordable substitute for the traditionally favored, yet pricier, beef.
Brazil's meat export sector demonstrates significant growth and strategic market diversification. According to the ITC Trade Map, Brazil's beef exports increased from 1.38 million metric tons in 2022 to 1.83 million metric tons in 2023. China remains Brazil's primary meat export destination, representing 67.2% of export value in 2023. Brazil is expanding its market presence in the United States and the European Union to reduce dependency on a single market. Feed premixes support Brazil's meat export sector by enhancing livestock health, productivity, and quality. These premixes deliver concentrated essential micronutrients that improve growth, development, weight gain, and feed efficiency, helping producers meet export quality standards. The expanding export opportunities are increasing domestic production, which drives the feed premix market growth.
