With “massive surpluses” of feed barley and adequate wheat stocks, the EU is said to be in a “comfortable position” regarding the availability of animal feed as it heads into the next decade. This is particularly true, because of the decline in the region’s livestock numbers.

Chart 1: EU barley surplus in 2009/10

However, senior market analysts Michael Archer and Jack Watts of the UK Home-Grown Cereals Authority (HGCA) warn that there could be problems over the availability of maize, especially if there are any weather problems during the growing season in the USA, which has a major influence on the international maize market as 40% of the world supply is grown there.

Chart 2: Maize remains the dominant feed grain

As far as oilseeds are concerned, Mr Archer believes one needs to look at the world situation, where the vast majority of the crops are grown in North and South America, and where a bumper harvest is expected in 2010 with no major problems expected.


They also feel fairly comfortable about the supply of soya next year, although they believe that the row over GM crops is likely to remain high on the agenda in the EU, with increased pressure put on the European Commission to relax its ban on these crops as food prices rise.

In June last year, the EU's Health and Consumer Protection Directorate-General launched an independent evaluation of the EU legislative framework on GM food and feed. The final analysis is due soon, and it is understood that the Directorate-General for the Environment is planning a parallel review on rules covering the cultivation of GM crops.

Chart 3: Can the EU meet increasing demand?

Since the evaluations will consider consumers' interests, the growing acceptance of agricultural biotech may clear the way for biotech companies and farmers who want to plant GM crops.

Currently, however, only GM maize MON 810 has passed the hurdles for cultivation in the EU and the crop may only be used as animal feed and with limited applications as food ingredients.

The EU has not approved another GM crop for cultivation for more than 11 years, while more than 140 GM crops have been approved outside of the European Union. In 2008, only seven of the 27 EU countries cultivate GM maize on a commercial basis.

Mr Archer and Mr Watts point out that exporters are particularly concerned by the EU’s current zero-level import policy. This adds to the costs of conventional exports because of the effort needed to clean container ships, particularly for American traders.


Asked what effect they feel the demand for biofuel crops would have on the price and the supply of animal feed in 2010, both Mr Archer and Mr Watts feel that it will be minimal.

Chart 4: Demand for grain for biofuels grows

Mr Watts says: “There is plenty of rain available, it’s the protein that could be in short supply, so using grains for biofuels could actually help rebalance the situation by producing power and Distillers’ Grains (DDGS) as a protein-rich by-product.

“More work is needed to assess the value of DDGS for animal feed and work out how best to use it.”

Going for growth

Roger Mann, of Anitox, agreed with the analysts that 2010 will be the year in which the European Union will have to look again at the veto on GM feeds.

While Mr Mann feels that markets across the board in the EU will largely be the same this year as they were last year, he believes that the trend going forward will be to focus on growth, as population numbers rise.

“This means a lot of work going into looking for alternative sources of protein and without doubt that will force the EU to look again at its veto on GM feed, as far as imports are concerned,” he says.

Another important area that could influence the animal feed market in the coming years is the continuing work on improving the genetics of animals to get more kilograms of meat produced per kg of feed.

This will increase pressure on plant breeders, as well as researchers, to develop more specialised feed supplements to meet greater demands for proteins as the population grows.

“We have to see some changes in the short- to medium-term because, if world population growth follows current predictions, we would need four globes to produce enough proteins for people if we continue with the current production methods,” Mr Mann adds.