Overview of world feed protein needs and supply - Andrew W. Speedy

Andrew W. Speedy
Senior Officer (Feed and Animal Nutrition)
Animal Production and Health Division
FAO, Rome, Italy

THE LIVESTOCK REVOLUTION

FAO and other institutions^[1] suggest that global meat production (Figure 1) and consumption will rise from 233 million tonnes (2000) to 300 million tonnes (2020), and milk from 568 to 700 million tonnes over the same period. Egg production will also increase by 30 percent. These predictions show a massive increase in animal protein demand, needed to satisfy the growth in the human population, and the increasing affluence of the emerging economies.

However, much of the growth has been taking place in a relatively small number of countries, including some of the most populous ones, e.g. China, Brazil^[2]. Including these two countries, the per capita meat consumption in the developing countries went from 11 to 23 kg in the 2 decades to the mid-1990s. Excluding these two countries, it went from 11 kg to only 15 kg (Figure 2).

Including or excluding China in the totals of the developing countries and the world, makes a significant difference for the aggregate growth rates of meat, though not of milk and dairy products, given the small weight of the latter products in China’s food consumption. It is even suggested by FAO (2000) that there may be an overestimation of China’s meat production.

Figure 1. Historical and predicted world production of meat in developed and developing countries

In particular, the apparently spectacular growth in pig production is very dependent on including China in the statistics (Figures 3 and 4). Pig production in China yields a very different commodity to that found in the West and is currently mainly small scale, although with large overall numbers. It is based on a different system and uses different kinds of feed, although intensive units are developing in the east.

If China’s growth in the consumption of pig meat over the last decade of about 2 kg/person/year (leading to the 39 kg of 1995/97) were to continue, the country would soon surpass the per capita consumption of the industrialized countries - an untenable prospect. Therefore, a rather drastic deceleration in growth rate, in China at least, and, given its large weighting, also in the global aggregates, is to be expected.

Figure 2. Historical and predicted world meat production, excluding China (contrast with data in Figure 1)

The world meat economy has been characterized by the rapid growth of the poultry sector (its share in total meat output went from 13 percent to 28 percent in the last three decades) and, in more recent years, the buoyancy of the meat trade (Figure 5).

Figure 3. Historical and predicted world production of pig meat

Figure 4. Historical and predicted world production of pig meat, excluding China (contrast with data in Figure 3)

Figure 5. Historical and predicted world production of chicken meat

TABLE 1
World export and import of chicken meat

Chicken Meat Exports and Imports

Although the United States is by far the biggest exporter of poultry meat, it is essential to note the importance of a number of developing and emerging economies in this market, most notably Brazil, but also Thailand. China’s position is somewhat anomalous, being at the top of both imports and exports, suggesting considerable reprocessing of poultry meat in that country (Table 1).

For eggs, there is also a large increase in production which may be expected to continue. Although not an exporter, India, with its very low poultry meat and egg consumption per capita, and a population rivalling that of China, could be thought of as a potential centre of growth for poultry. The poultry sector in India is one of the fastest growing sectors in the country. India is the fourth largest producer of eggs and eighth largest producer of broilers in the world.

India's broiler industry is not well organized in the North, but in the South, the producers have come together to form integrated operations. In the egg production industry, thirty per cent is still in the hands of small producers. The whole Indian poultry industry has a turnover of Rs 90 bn (1999) and has set itself a target of achieving a total turnover of Rs 270 bn by 2005. Of the total production of eggs and broilers, the States of Karnataka, Kerala, Andra Pradesh, Tamil Nadu and the western region of Maharashtra, account for more than 56 percent of total national egg production and similarly 60 percent of the broilers. Tamil Nadus' Coimbatore region alone accounted for more than 30 percent of the total broiler production in 2000. Poultry farming is hampered in northern regions because of cold conditions during certain periods of the year, although Punjab alone contributed more than 6 percent of the total egg production in the country.

It is suggested that the Indian poultry sector has the potential to grow at 20 percent per annum over the next 10 years. This arises from the fact that even developing neighbours, such as Pakistan, China and Thailand have annual per capita consumption levels of 2.3, 4 and 9 kg respectively, compared with India at less than 1 kg. A developed country like the United States has an annual consumption of 44 kg per head. A similar situation exists for the egg industry. With the advent of fast-food chains and growing dependence on convenience foods, the processed foods sector, and particularly that of poultry, is expected to have a growth rate in double figures (Figure 6).^[3]

Consumption of milk and dairy products has some way to go before it hits limits. In the projections, there is higher growth in the world milk and dairy sector than in the recent past because of the cessation of declines and some recovery in the transition economies (FAO, 2000) (Figure 7).

Figure 6. Historical and predicted world production of eggs.

Figure 7. Historical and predicted world production of milk

Excluding the transition economies, world demand should continue to grow at 1.6 percent per annum (p.a.) as in the past. China has little influence on the dairy sector because consumption has historically been very low. However, there are signs, particularly in the cities, of a change in this culture and an exponential growth in demand, albeit from a very low base.

Overall, it is quite possible to have an optimistic view of the growth of the livestock industry and its contribution to better human nutrition. But many developing countries and whole regions, where the need to increase protein consumption is the greatest, have not been participating in the buoyancy of the world meat sector. In this category are the regions of sub-Saharan Africa (with very low consumption per capita reflecting the quasi perennial economic stagnation), the Near East and North Africa. Here, the rapid progress of the period to the late 1980s (oil boom) was interrupted and subsequently slightly reversed, due in some respects to the collapse of consumption in Iraq. Similar considerations apply to the developments in the per capita consumption of milk and dairy products.

GROWTH IN WORLD ANIMAL FEED

The growth in demand for livestock products suggests that there will be a consequent rise in demand for animal feed, not only of cereals but of other feeds and particularly proteins. Data on feed production and consumption are much harder to assemble, and FAO does not have comprehensive information about these important commodities. Such data should be available so that a better picture of the world feed market can be obtained.

In the meantime, it is possible to make broad calculations based on assumptions concerning the use of feed for pigs, poultry, dairy cows and other ruminants. The graph below (Figure 8) is calculated from livestock production data, assuming that:

• broilers convert at 2:1 and have a 70 percent carcass yield;

• egg production has a 2:1 food conversion ratio;

• pigs convert at 3:1 and have a 60 percent carcass yield;

• 3 litres of milk are produced per kilogram of cow feed.

Such a calculation may be more reasonable at predicting the future trends, given that growth will be mainly in intensive systems. However, the limitations must be noted.

Figure 8. Projected world growth in demand for animal feed based on existing feed conversion ratios and carcass yields (see text)

Figure 9. Projected growth in world demand for animal feed, excluding that predicted for pigs in China (contrast with data in Figure 8)

Again, the position is distorted by the contribution of China to the projected growth in pig production. Excluding China may again give a more realistic view, and it still implies considerable growth (Figure 9).

Indeed, including China has led to a number of ‘profit-of-doom’ scenarios, particularly relating to world cereal demand (Who will feed China? Lester Brown, World Watch Institute, 1999). Predictions by Zhang Ziyi of the Chinese Academy of Science (2001) gave a different view. Not only did he assert that the increase in Chinese pig production would not be based wholly on cereals, but also pointed out that there would be a fall in consumption of processed cereals as the population moved to a more animal based diet (Figure 10).

Figure 10. Growth in per capita consumption of grain and animal products in China over the past 50 years

In this instance, the projected growth in feed consumption is taken as the best available estimate, but this needs to be greatly improved.

Indeed, even in developed countries, the trend over the last 50 years has been in the diversification of feed raw materials used, as well as the global trade in alternatives. This is highlighted in a paper by Verstegen and Tamminga (2001) (The practice of animal nutrition in the 21st Century). They show the ingredients of diets in 1950 and 1988 for pigs and in 1963 and 1988 for laying hens (Tables 2 and 3). They also point out the effects on the nutrition of animals resulting from the use of higher fibre diets and non-starch polysaccharides. This they assert affects protein nutrition, as well as energy nutrition. Finally, Verstegen and Tamminga note the demand for reduction in Nitrogen (and Phosphorus) excretion associated with animal feeding.

TABLE 2
Comparison of compound feed composition for fattening pigs in1950 and in 1988 (Verstegen and Tamminga, 2001)

Compound feed composition (%) for fattening pigs, 50-100 kg live weight

The practice of animal nutrition in the 21th century, Martin W.A. Verstegen and Seerp Tamminga, Wageningen Institute of Animal Science, NL-6709 PG Wageningen, The Netherlands, J.M. Bell Distingueshd Lectureship Series, University of Saskatchewan, Saskatoon SK Canada, September 27, 2001

GROWTH IN PROTEIN FEEDS

There may be some divergence from the use of cereals for feed but the need for protein feeds cannot be avoided. Above all, quality protein will be required to satisfy the increase in milk and meat production, particularly as the latter will come mostly from poultry and pigs.

The projection given here is again based on the very simple assumption that 15 percent of the feed will be protein feeds. This appears to match the FAO data on production of oil cakes and meals over the period shown. Fish meal data are also available but statistics on the production of meat meals is lacking in FAO (although there are trade data). Indeed, this category is poorly defined in the figures collected from countries and could possibly be misleading, as far as meat-and-bone-meal (MBM) is concerned.

TABLE 3
Comparison of compound feed composition for laying hens in 1963 and in 1988 (Verstegen and Tamminga, 2001)

The practice of animal nutrition in the 21th century, Martin W.A. Verstegen and Seerp Tamminga, Wageningen Institute of Animal Science, NL-6709 PG Wageningen, The Netherlands, J.M. Bell Distingueshd Lectureship Series, University of Saskatchewan, Saskatoon SK Canada, September 27, 2001

In any case, the projection based on FAOSTAT data shows a major increase in the demand for oil meals and cakes (Figure 11).

Fortunately, the demands for livestock feed are matched by the increasing world demand for vegetable oils. FAO (2000) states that the aggregate growth of world demand and production (in oil equivalent) will continue to be well above that of total growth in agriculture, but at 2.1 percent p.a. in the next two decades, it will be much lower than the 4.0 percent p.a. recorded over the past 20 years. This deceleration will essentially reflect the factors of lower population growth, more and more countries achieving medium-high levels of consumption, and, of course, persistence of low incomes in many countries, limiting their effective demand.

Figure 11. Projected world growth in protein cakes and meals based on protein feeds making up 15 percent of the feed diet (Source: FAOSTAT)

On the production side, the trend has been for four oil crops (oil palm, soybeans, sunflower seed and rapeseed) and a small number of countries, to provide much of the increase in world output. With the lower demand growth in the future and changes in policies (e.g. limits to subsidized production), the future pace of structural change in favour of some of these crops could be less pronounced. The sector accounted for a good part of cultivated land expansion in the past, and in the industrial countries, it made up for part of the decline in cereal area. The projections of land use in the developing countries indicate that oil crops will continue to account for a good part of future expansion of harvested area.

The rapid growth in demand of the developing countries was accompanied by the emergence of several as major importers of oils and oilseeds. If the five major net exporters among the developing countries (Malaysia, Indonesia, the Philippines, Brazil, and Argentina) are excluded, the others increased their net imports of oils and oilseeds (in oil equivalent) from 1 to 14 million tonnes between 1974/76 and 1995/97. In parallel, however, the five major exporters increased their net exports from 4 to 18 million tonnes, so that the net export balance of all the developing countries increased slightly. In the future, these trends are likely to continue and the net balance of the developing countries would not change much. The developing countries have so far been net exporters of oil meals. This has enabled them to maintain a positive, though declining trade balance in terms of the value of their combined trade of oilseeds, oils and meals. However, with the development of their livestock sector, the prospect is that their net exports of oil meals could turn into net imports. This is yet another dimension of the above-mentioned trend for some developing countries to turn into net importers of agricultural products.

FAOSTAT data are shown in Table 4 and Figure 12. These illustrate the discussion above, concerning the importance of soya beans, oil palm and rapeseed and sunflower. Except for soya, this has further implications for animal nutrition.

Fishmeal production has not increased markedly over the last 20 years and is unlikely to do so from conventional sources (given the pressures on world fisheries). The question must be asked as to whether there are alternative sources of fish from developing countries where the industry is poorly developed?

TABLE 4
Production of oil cakes and meals over the past 20 years

Animal protein is a major issue. It has contributed a relatively small but significant and high quality part of protein supply. With the ban on the use of animal protein as feed in Europe and other countries, it raises the following questions:

1. Can alternative sources of protein be found?

2. How will the waste animal protein be dealt with and what will be the problems of the industry which supplies it?

Figure 12. World production of oil cakes and meals over the past 20 years by type of product. The domination of Soya (darker yellow) is very evident

These questions have arisen because of bovine spongiform encephalopathy (BSE) which has provoked the whole issue of animal feed safety and its implications for the livestock industry.

PROBLEMS OF THE FEED INDUSTRY

In recent years and in many countries, public concern about the safety of foods of animal origin has heightened due to problems that have arisen with BSE, dioxin contamination, outbreaks of food borne bacterial infections, and as a result of growing concern about veterinary drug residues and microbial resistance to antibiotics. These problems have drawn attention to practices within the feed and livestock industries, and have prompted health professionals and the feed industry to closely scrutinise food quality and safety issues.

BSE resulted from the appearance of abnormal prion proteins in neural tissues, and is probably transmitted through the ingestion of nervous or lymphatic tissues from an infected animal through contaminated meat and bone meal. The causative agent has proved to be very resistant to normal methods of sterilization and safe rendering of infected tissues. Laboratory identification of this problem in 1994 led to the recognition that the disease was being transmitted to animals by the use of concentrated feed incorporating MBM from infected animals, and consequently the use of MBM in feed preparation was prohibited in the European Union.

FAO analysis of trade data showed that such feeds had been exported to other countries and together with exported animals, and other animal products, could represent a means of cross boundary spread of BSE. Although control measures were put in place as a greater understanding of BSE was gained, the disease spread throughout the United Kingdom and across Europe, and at present 20 countries have confirmed cases (including Japan).

The risk analyses and strict control measures employed in the United Kingdom have reduced the incidence of BSE, but as yet it has not been eliminated. Meanwhile the spread of BSE to other countries implies that any importer of live animals and MBM from the United Kingdom and other European countries may now have the BSE agent present. The picture resulting from the European Commission Scientific Steering Committee Geographic BSE risk assessment studies (GBR) is shown at Figure 13.

Figure 13. World risk of contamination from bovine spongiform encephalopathy (BSE). (Source: European Commission Scientific Steering Committee Geographic Assessment)

The inevitable conclusion is that BSE has spread from the United Kingdom to the rest of Europe, and thence to other countries, notably those of Central and Eastern Europe. The extent to which it has spread but remains latent is impossible to determine. The trade matrix of MBM during the 1990s suggests that other countries may have imported the infective agent.

Figure 14. Trade matrix of the export and import of meat and bone meal (MBM) in the period 1996 to 1999

This position is one of the primary reasons for debate on alternative protein sources for the animal feed industry. However, the issues of rational use of MBM and the consequences for the industry should also be addressed. Given public pressure, it is obvious that human health and safety considerations must be paramount.

BSE is not the only concern with respect to zoonotic diseases in which animal feed can be implicated. Other, numerically greater problems include: Salmonella enteritidis, Escherichia coli O157:H7, Listeria monocytogenes, avian influenza H5N1, Trichinella spiralis, mycotoxins, veterinary drugs and chemical contaminants. FAO is concerned to implement the relevant standards and guidelines of the Codex Alimentarius which relate to the safety of animal feed in these matters. Relevant Codex standards include:

• Contaminants and Toxins in Food

• Maximum Residue Limits (MRLs) for Pesticides, etc.

• Maximum Residue Limits (MRLs) for Veterinary Drugs

• International Code of Practice for Control of the Use of Veterinary Drugs

• Aflatoxins in Raw Materials and Supplemental Feeding Stuffs for Milk Producing Animals

• Labelling of Pre-Packaged Foods and the forthcoming Code of Practice for Good Animal Feeding (Codex Ad Hoc Inter-Governmental Task Force on Good Animal Feeding).

To this may be added the issue of environmental pollution, particularly by intensive livestock. In Europe, there is a demand for reduction in Nitrogen (and Phosphorus) excretion, which has implications for animal nutrition, particularly in the use of protein feeds.

CONCLUSIONS

A number of trends may be discerned in the livestock and feed industries. There is a continuing rise in the demand for animal products and particularly those from poultry and pigs. There is a concomitant rise in the need for animal feeds and particularly oil cakes and meals. At the same time, there is increased public concern about contaminants and health, and demand for safety, regulation and traceability.

Globalization of trade affects all countries, and of particular note is the increased production and export of poultry meat from developing countries. But there is also trade in other meats, including beef, and increased world commerce in feed raw materials.

The collection of good quality data relating to world market forces and the availability of proteins for the feed industry should be addressed. Innovative developments in the feed industry should be sought with a view to providing alternative sources of proteins and new amino acid technologies.

Feed safety should also be high on the agenda and proposals should consider a worldwide Code of Practice for the production of proteins for the feed industry.

REFERENCES

Brown, L.R., 1995. Who Will Feed China? Worldwatch Institute, Washington DC.

Delgado, C., Rosengrant, M., Steinfeld, H., Ehui, S. and Courbois, C., 1999. Livestock to 2020: The Next Food Revolution. Food, Agriculture and the Environment paper 28. International Food Policy Research Institute, Washington DC.

FAO, 2000, 2001. FAOSTAT. http://apps.fao.org/default.htm

FAO, 2002. World Agriculture: towards 20015/2030. Summary Report. Food and Agriculture Organization of the United Nations, Rome.

Verstegen, M.W.A. and Tamminga, S., 2001. The practice of animal nutrition in the 21st Century, Wageningen Institute of Animal Science, NL-6709 PG Wageningen, The Netherlands. J. M. Bell Distinguished Lectureship Series, University of Saskatchewan, Saskatoon SK Canada, September 27, 2001.