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  • By Lynda Kiernan-Stone, Global AgInvesting Media

Cargill, Land O’Lakes Each Forge Separate Animal Feed Partnerships

Global compound feed production by volume is estimated to be 1 billion tons per year, and worldwide commercial feed manufacturing drives turnover of more than $400 billion, according to the International Feed Industry Federation - an international body consisting of feed associations from North and South America, Asia Pacific, Africa, Europe, and the Middle East, as well as global corporate entities and related feed organizations representing 80 percent of the world’s compound animal feed production system.

By 2050 the demand for food is projected to climb by 60 percent, and over the period of time between 2010 and 2050, animal protein production is expected to see growth of 1.7 percent per year, with meat production increasing by 70 percent; aquaculture output increasing by 90 percent; and dairy production increasing by 55 percent. Taken further, if established growth rates recorded over the past 40 years are extrapolated into the future to 2050, animal protein production needs would quadruple, in theory.

Rising global populations and increasing wealth – particularly in emerging economies - will exert pressure on animal protein producers, and therefore on the animal feed industry to fill the gap in supply. These factors, and the recent approval by the EU and Canada clearing insect protein for use in aquaculture feed, have made animal feed a category that represents a channel for growth for the world’s largest commodity companies.

Cargill and InnovaFeed

Cargill and InnovaFeed have announced a mutual strategic partnership to supply sustainable and innovative feed products and options to the global animal nutrition industry. Together, the companies will collaborate to jointly market fish feed - including insect protein - in support of a thriving global aquaculture industry.

"We recognize that the planet has finite resources," said Pilar Cruz, president of Cargill's compound feed business. "It is our job to find innovative feed options for our customers that protect the planet and support sustainable protein production."

Leveling up sustainability in its production methods, InnovaFeed’s “circular economy approach” uses co-products from the agricultural production of starch and sugar to feed Hermetia illucens, or black soldier fly larvae. Once the larvae achieve a suitable stage of growth, protein and oil are extracted to be used in feed products for aquaculture species, pets, and livestock, such as piglets, and broilers.

"By upcycling local cereal co-products and repurposing insect waste as an organic fertilizer, InnovaFeed's products truly have a positive environmental impact," said Clement Ray, chief executive officer, InnovaFeed. "We're also able to have a positive impact on climate change by saving 25,000 tons of CO2 emissions per year with each 10,000-ton-production unit by feeding insect meal to animals. That is equivalent to removing 14,000 cars off the roads."

The partnership also will serve Cargill in becoming a preferred feed supplier for aquaculture and animal protein producers who are looking to meet customer demand for sustainably produced foods and products.

"This partnership will not only enable our salmon and shrimp customers to differentiate their product lines to meet consumer needs, but we'll also be responsibly managing resources, enabling both companies to support the growth of sustainable aquaculture and make a positive impact at a global scale," said Adriano Marcon, president of Cargill's aqua nutrition business.

Land O'Lakes and Royal Agrifirm Group

U.S.-based cooperative Land O’Lakes and Dutch cooperative Royal Agrifirm Group announced that they are establishing a joint venture for the supply of dairy animal feed in China to be called Agrilakes.

"With this new investment in China alongside Agrifirm, we are continuing Land O'Lakes' successful international commercial growth strategy focused on partnering with locally-successful companies and working together to drive market expansion," said Jerry Kaminski, executive vice president and chief operating officer of Land O'Lakes.

Initially, the new entity will be based out of Agrifirm’s existing manufacturing plant in Tianjin, and will leverage existing market knowledge, insights, technologies, and R&D capabilities provided by both companies to supply world-class service to their Chinese customers and the country’s dairy farmers. Future plans for Agrilakes include the construction of a new dairy premix and specialty plant on the adjacent property in Tianjin.

“Thanks to Agrifirm's established infrastructure and reputation in China, paired with Land O'Lakes' strong research and technology expertise, we are confident this new joint venture is well-positioned to help grow both companies,” said Kaminski.

Both companies bring valuable experience in-country to the partnership. Land O’Lakes currently has subsidiaries Purina Animal Nutrition and WinField® United crop protection in China, through which it leverages capabilities and proprietary products. It also operates the Dairy Farming Institute in partnership with Nestlé - a training facility with two farms, trial fields, and a training center to help local Chinese forage growers and commercial dairy farmers develop their skills.

Agrifirm has been in China for 20 years, with control of Nuscience, a wholly owned subsidiary and the company’s key global animal nutrition entity. Through this business branded as LVSAI, Agrifirm operates two young animal nutrition and premix plants, and a business that sells feed ingredients and multi-species feed additives.

"With more than 20 years of market experience in China, this joint venture with Land O'Lakes positions Agrifirm to further implement its growth strategy and continue developing a reliable, responsible food chain for future generations in China," said Dick Hordijk, chief executive officer of Agrifirm.

"Agrifirm is proud to bring more than 100 years of experience in the feed and dairy business, and deep experience in China, to this new joint venture. We look forward to leveraging the knowledge, experience and products of both Agrifirm and Land O'Lakes to strengthen our China market presence and help China's dairy farmers on the road to success."

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