‘More education is required to boost feed enzyme usage rates in emerging markets’ - Freedonia
Freedonia values the global feed enzyme sector in the range of US$750 to $800 million globally.
“The market appears to be expanding in the mid to upper single digits,” said Ned Zimmerman, chemicals group leader at Freedonia.
Indeed, another research firm, MarketandMarkets, forecasts the category will reach $1,371.03m in value by 2020, at a compound annual growth rate (CAGR) of 7.3% from 2015 to 2020.
“It remains a competitive market, but globally the big players include AB Enzymes, Adisseo, BASF, DSM, DuPont, and Novozymes,” said Zimmerman.
Education initiatives critical
He said there are a number of challenges, however, around increasing enzyme sales in emerging markets as modern industrial animal husbandry techniques have not yet fully taken hold in several countries.
And he said farmers in those markets need to be convinced that feed enzymes are not only effective for the health of their livestock, but beneficial for their bottom lines.
“Consequently more education is required to boost enzyme usage rates, and in some cases distribution also remains an issue where more centralized feed compounding and delivery are not well established,” he told us.
Dr Giles Shih, CEO of BRI, a global biotechnology company specializing in the research, development and manufacture of enzyme feed additives, said global markets that use alternative ingredients or less digestible feed can benefit the most from the use of enzymes.
“Critical factors that encourage greater use of feed enzymes include increasing feed costs and better acceptance and knowledge of how to use enzymes to improve animal performance.
In addition, the availability and power of life science tools to develop the next generation of feed enzymes is helping to maximize ROI.
In some markets, the trend to move away from antibiotic growth promoters is also driving interest and uptake of feed enzymes,” he told FeedNavigator.
Antibiotic-free nutrition
Jean-Paul Ruckebusch, global category manager enzymes at DSM Animal Nutrition and Health, also reckons feed enzymes will play an essential role in antibiotic-free nutrition besides eubiotics and other husbandry solutions.
And he said the feed enzyme markets will keep growing as enzymes further improve the digestibility of traditional feed ingredients such as corn and soy, and also by-products from various agriculture and food industries, with the additional benefits of substantial reductions of phosphorus and nitrogen excretion in the environment.
“Competition between food, feed and renewable energy is unlikely to decrease, while feed costs are likely to increase as well as the demand for sustainable solutions such as feed enzymes with a good return on investment,” he said.
The greatest volume of enzymes used in feed are still phytases, followed by carbohydrases and then proteases, said Dr Shih.
“Phytases are more important in developed markets where concern over phosphorous emissions in animal feces is greater,” noted Zimmerman.
Species expansion can drive market
The Freedonia chemicals market analyst said that, at a broader level, the industry is still working to develop enzymes that boost animal health and nutrition across all species, which should continue to expand the size of the market overall.
Dr Shih pointed out that most feed enzymes are still primarily used in poultry.
“BRI and others are seeing some efficacy in the use of enzymes in the diets of swine. Use of enzymes in aquaculture is being tested more frequently, while I would consider the use of enzymes in ruminants still at the research stage at this point,” he added.
Phytase, said Ruckebusch, is gaining credit in aquafeeds not only for costs savings but also as an environmental solution, along with carbohydrases that “help fish producers replace more expensive marine meals with vegetable alternatives.”
And the DSM enzyme expert stressed innovation in feed enzymes and the ability to create value is the key driver behind pricing.
“Because many feed enzymes are specifically tailored to drive performance and value in specific animal diets, they are not easily substituted in the market, so prices are fairly stable,” added Dr Shih.
Enzyme production
Most feed enzymes today are produced by fungal or bacterial fermentation, which is scalable and cost-effective in terms of current production processes.
However, Dr Shih said there is a lot of interest and active research on the potential of producing enzymes in alternative systems such as algae and crop plants in the future.
In terms of manufacturing challenges, Ruckebusch said it is critical the young chicken gets the right amount of active enzyme in the few crumbs it intakes daily: “Once this enzyme has been screened for its efficacy on the feed substrate, its resistance to digestive enzymes and acidic conditions, and its high intrinsic thermostability, it must be formulated into granules with a high number of particles and suitable distribution size for good flowability for accurate dosing and an homogeneous distribution into the feeds.
This formulation will have also to ensure excellent pelleting stability along with the release of the phytase as quickly as possible in the gut to attack the phytate molecules before they precipitate.”
