World Grain - August 2022 - 48

FEED QUARTERLY: EU FEED INDUSTRY BATTLING PERFECT STORM
" Soaring commodity prices, not only of grains but of
oil meals, freight, trace minerals, energy and so on, have
immensely increased our premix and feed formulation
costs, " Pulay said, adding that feed producers are still relying
on the carry-out stocks but they are running low, and
there is no hope for a seasonal drop in commodity prices.
" The old pattern that new crop brings (price) relief is
over, " he added. " The question is to what extent livestock
prices will follow this trend? "
The problem already has been recognized by several
livestock associations in Europe. Stefan Chrzanowski,
director of the Polish poultry producing association,
Poldrób, told the local press in May that the situation
in the industry was so tense that it was no longer about
high prices, but about feedstuff availability.
The world production of major cereals is expected to
decline in 2022 for the first time in four years, while global
utilization is also seen down for the first time in 20 years,
the Food and Agriculture Organization (FAO) said in its
recent Food Outlook. The use of cereals for direct food
consumption by humans is not anticipated to be impacted,
as the decline in total use is expected to result from lower
feed use of wheat, coarse grains and rice, the FAO added.
Looming livestock culls
World leaders seem to worry primarily about food
grains, but they also should turn their sights on the
feedstuffs, which also serve as a basis of the food market,
said Andrij Jarmak, an economist at the FAO.
" Ukraine exports much more feed than food grain, "
Jarmak said. " And in fact, it is impossible to replace
Ukraine in this market. "
He added that the current market conditions may
provoke a sharp drop in livestock population not only
in Europe but also in other markets dependent on
Ukrainian grain.
" By the end of 2022, meat prices will be cosmic in
some countries, " Jarmak said.
There are signs that these processes already have
begun. In March 2022, Reuters reported that farmers
in Southern Europe considered massively slaughtering
their herds due to a lack of feed. Several Italian companies
also voiced strong concerns over feed availability.
" The war in Ukraine cuts feed rations of cows, pigs
and chickens by up to 10% at Italian farms that face
the worst food crisis since the end of the Second World
War, " the Italian agricultural company Coldiretti said.
Over the past decade, Italian corn production dropped
by a third and many wheat fields were also lost, since
the incentives to grow these crops in Italy were rather
low. Now, the country's farmers must pay a high price,
Coldiretti admitted.
In Ireland, the average pig farmer has lost €206,000
in the first four months of 2022 due to skyrocketing
feed prices. Some farmers already have begun culling
their stock in a bid to mitigate bigger losses, Irish consultancy
Teagasc estimated.
Pig feed prices rose by €50 per tonne in April to a
composite €449 per tonne, Teagasc said, adding that a
further hike of around €20 to €30 per tonne in pig feed
costs was projected in the foreseeable future.
" While a rise in pig prices is anticipated over the coming
months, pig farmers will continue to lose money, "
Teagasc warned. " The Irish sow herd has already begun
48
August 2022 / World Grain / World-Grain.com
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World Grain - August 2022

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