Aurelio Sebastia

FEFAC

Outlook poultry sector

Aurelio SebastiaDeputy President of FEFAC

• Created in 1959

• Industrial compound feed and premixtures manufacturers

• 28 Members:– 21 Member Associations from 20 EU Member States – 4 Observer members (Turkey, Croatia, Serbia, Russia)– 3 Associate Members (Switzerland, Norway, EMFEMA)

• 150 mio. T of compound feed /year

• Total EU turnover estimated between 45 and 50 Bio €

• 6 Technical committees to assist the FEFAC Council– Animal Nutrition– Industrial Compound Feed Production– Premix & Mineral Feed– European Feed Manufacturers Guide (EFMC)– Fish Feed– Milk Replacers

FEFAC in a nutshell

29 June 2011 2COPA-COGECA

Industrial compound feed production per country 150 mio. t in 2010 in the EU-27

Source: FEFAC

BE6.4

CZ2.8

DE21.7DK

4.5

ES20.5

FR21.4

HU3.9

IT13.8

IE3.7

NL 13.8

PT3.4

RO3.3

PL7.6

UK 14.6

AT1.4

CY0.3

EE0.2

FI1.4

LT0.4

LV0.3

SE2.0

SI0.5 SK

0.7

BU0.9Others

8.0


Industrial compound feed production in the EU-27 in 2010150 mio. t (per category)

Source: FEFAC

Cattle26%

Pigs33%

Poultry & eggs34%

Milk replacers1%

Others6%


Feed material consumption by the EU-27 feed industry in 2010

Source: FEFAC

Feed cereals47%

Tapioca0.5%

Co-products from Food Industry

12%

Oils & Fats2%

Cakes & Meals27%

Pulses1%

Dairy products1%

Dried forage2%

Minerals, Additives & Vitamins

3%

All others 5%


Improvements in modern animal production

From 1975 to 2010, animal output increased significantly

• Milk production per cow >65%• Piglets raised per sow per year >65%• Egg production per hen >45%• Body weight gain broilers >25%

And animal production became more efficient and sustainable

• Pig Feed Conversion Ratio improvement >20%• Reduction of P, N and ammonia emissions per ha ≈50%• Reduction of Fish meal & Fish oil in fish feed >40%


Evolution of the global Feed Conversion Ratio from 1923 to 2001


Source: World Poultry Science Journal Vol. 67 June 2011

kg / kg

Evolution of the Feed Conversion Ratio for poultry in Denmark from 2002 to 2011


The challenges ahead:Meeting increasing demand for animal products• World population increasing

• Living standards improving

• Demand for food increasing every year

• Competition for land with non-food use and urban development

• Only solution is to improve resource efficiency29 June 2011 9COPA-COGECA

The challenges for the CAP towards 2020

• The EU agriculture must– Produce more (to meet the increasing world demand)– Be more resource efficient (stopping discrimination

regarding public support between modern / intensive and traditional / extensive / organic)

– Secure the supply of the EU feed & food chains– Be developed everywhere in Europe– Be competitive and economically viable for farmers and

related sectors– Generate safe, diverse, affordable products

• The EU must produce more, better, everywhere and at an affordable price


The factors affecting the production costs of EU compound feed

• Feed materials prices (up to 85% of the compound feed costs)

• Availability of feed materials (sufficient volumes, regularity of supply, etc)

• Legal restrictions to Feed materials (asynchronous authorisations GMOs, PAPs, etc.)

• Feed safety legislation (HACCP, monitoring of contaminants, etc.)

• Environmental constraints (restrictions on N or P emissions, Carbon Footprint)

• Multiplication of « cahiers des charges »

29 June 201129 June 2011 11COPA-COGECA

The key challenges of feed material supply for the EU feed industry

1. Elimination of 0-tolerance for Low Level Presence of non-EU approved GMOs in imported feed materials

2. Re-authorisation of PAPs

3. Buying feed materials from sustainable sources

4. Managing volatility


Asynchronous GM approvals

• EU Commisison proposal for « Technical Solution »- MRPL of 0.1% & analytical uncertainty

- For events for which a dossier for authorisation has been tabled (at least 3 months) and a method of analysis is validated by EURL

- Also covers no longer authorised GM events,

- « feed » scope only,

- EP Scrutiny until 15 June – entry into force early July 2011

- Possible future review taking into account impact on feed and food chains

• FEFAC position on draft « Technical Solution » – FEFAC supports « feed » only proposal as a first step in the right direction

– FEFAC supports FFC position in favour of food and feed scope for the future


Feed ban: FEFAC views

• Supports lifting of the feed ban but not at any price:– Need for good communication– Need for proportionate measure

• Single species goes too far (what is an animal species?)• Should be possible also for mills producing non-ruminant feed• Need for tolerances

– Need for level playing field (vs. home mixers, 3rd countries)

• Who may use the 1.0 mio. T of pig&poultry meal?– EU Petfood: 200,000 t?– EU Fish feed: 250,000 t? – EU industrial pig&poultry feed: 200,000 t?– EU Home mixers: 50,000 t?– Export: 300,000 t?


Sustainability: The FEFAC Credo (1)

• FEFAC believes that products of animal origin form an integral part of the European diet providing key nutritional benefits to the European population.

• Nutritionally optimised feed meeting the physiological requirements of animals and fish raised for food production purposes is essential to mitigate the environmental impact of production and consumption of animal products.

• The EU compound feed industry is willing to responsibly contribute to the sustainable development of livestock and aquaculture production systems.


FEFAC believes that the key drivers for such improvements are:

– Promotion of ecologically intensive production systems for farm animals and fish, oriented towards maximisation of resources efficiency and minimisation of GHG emissions;

– Changes in diet patterns and composition for farm animals and fish to significantly reduce the GHG emissions attributed to livestock production systems (e.g. methane);

– Improvement of feed efficiency, i.e. the conversion of feed into animal products, in order to control the use of resources and to reduce the loss of nutrients;

– Further optimisation of use of co-products from the food industry, biomass and non-organic raw materials to alleviate the

pressure on natural resources.

Sustainability: The FEFAC Credo (2)


Illustration: Round Table on Responsible Soy (RTRS)

• Goal and Mission:to build up a global and participatory process that promotes economically viable, socially equitable and environmentally sustainable production of soy

• Objectives:– Develop common view on issues– Develop sustainability criteria

• Practically applicable • Verifiable

– Develop control system at production level– Organise chain of custody• http://www.responsiblesoy.org/


Controlling extreme volatility

• Review of MiFID– Key target: convergence between futures and cash

markets– Transparency: Weekly public information on positions

taken by categories of operators– No need at this stage to set up position limits by

categories of operators

• Farm Ministers G20

• More transparency on global agriculture data

• Index based price formation: which model: France, Belgium other?


FEFAC

Thank you for your attention

www.fefac.eu

29 June 2011 19COPA-COGECA Workshop

Business

Aurelio Sebastia