© 2018 LMC International. All rights reserved. www.lmc.co.uk
The Protein Era – Challenges and opportunities for traditional and novel protein sources
Sara Girardello - LMC International Ltd
Feed Protein Vision, Amsterdam – 6-7th March 2018
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2
1. Why is the Protein Era emerging?
2. Demand for high-protein feed
ingredients is increasing, but there
are questions regarding the outlook
for supply
3. New opportunities for meeting
protein demand
Why is the Protein Era emerging?
© 2018 LMC International. All rights reserved. Feed protein vision
Calorie disappearance and GDP per capita, 1975-2013
Calorie disappearance per capita follows income growth
Data source: UN FAO.
5
1,500
2,000
2,500
3,000
3,500
4,000
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000
Ca
lori
e d
isa
pp
ea
ran
ce
pe
r p
ers
on
(k
ca
l/d
ay/c
ap
ita
)
GDP per capita (Real 2000 US$)
Individual dots represent one country, for one year:
© 2018 LMC International. All rights reserved. Feed protein vision
Share of total calories from different sources and GDP per capita, 1975-2013
As income grows, the make-up of our diet also changes
6
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
1,000 10,000 15,000 20,000 25,000 30,000 35,000
Sh
are
of
ca
lori
e in
take
GDP per capita (Real 2000 US$)
Vegetal products Dairy products Meat
© 2018 LMC International. All rights reserved. Feed protein vision
0
20
40
60
80
100
120
1961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011
Pro
du
cti
on
(m
illio
ns
to
nn
es
)
Aquaculture Bovine MeatPigmeat Poultry Meat
Production of meat from cattle, pigs, poultry
and aquaculture
Production of meat from cattle, pigs, poultry
and aquaculture as a share of total meat
Meat production is growing faster for certain species
7
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
1962 1967 1972 1977 1982 1987 1992 1997 2002 2007 2012
Sh
are
of
tota
l m
ea
t p
rod
uc
tio
n
Aquaculture Bovine meatPigmeat Poultry meat
© 2018 LMC International. All rights reserved. Feed protein vision
Protein requirement of different livestock species and the required volume
of protein required between 2015 and 2035
Protein requirements vary by species
8
0
10
20
30
40
50
60
0%
10%
20%
30%
40%
50%
60%
Broilers Fish Pigs Layers Beef cattle Dairy cattle
Pro
tein
fee
d d
em
an
d (m
illion
ton
ne
s)
Re
qu
ire
d p
rote
in c
on
ten
t (%
)
Protein-adjusted feed demand Protein requirement (%)
© 2018 LMC International. All rights reserved. Feed protein vision
Protein content of major meals, concentrates & isolates
Only certain sources of protein will meet the requirements
9
0% 20% 40% 60% 80% 100%
MaizeFeed wheat
Rice branWheat bran
Palm kernel mealCorn gluten feed
Dry peasMaize DDG
Whey protein concentrate 35%Sunflowerseed meal
Wheat DDGRapeseed meal
Cottonseed mealSoybean meal
Groundnut mealMeat & bone meal
Poultry by-product mealSoy protein concentrate
Corn gluten mealFishmeal
Whey protein concentrate 80%Vital wheat gluten
Pea protein concentratePotato protein concentrate
Feather mealSoy protein isolate
Whey protein isolate
Protein content (% DM)
Low Medium High
© 2018 LMC International. All rights reserved. Feed protein vision
Consumption of the main protein-containing feed ingredients (average 2015-2017)
Supply of high-protein feed ingredients is limited
10
0
10
20
Maize Soybeanmeal
PAPs Fishmeal CGM SPC VWG SPI
Mil
lio
n to
nn
es
Maize > 1 billion MT
SBM > 220 million MT
The outlook for high-protein feed
© 2018 LMC International. All rights reserved. Feed protein vision
• Soybean meal is the protein feed par excellence and the price benchmark for all other protein feed ingredients.
Soy protein concentrate (SPC) and isolate are also attractive soy protein products.
• However, breeding programmes and expansion in new growing areas in the last 20 years appear to have resulted
in a decline in protein content.
Soybean is the most important source of vegetable protein
12
Protein content of soy products
0% 20% 40% 60% 80% 100%
Maize
Soybean meal
Soy protein concentrate
Fishmeal
Soy protein isolate
Soy protein isolate
Protein content (% DM)
37%
38%
39%
40%
41%
42%
43%
2001 2003 2005 2007 2009 2011 2013 2015
% D
M
US soybean Brazil soybean Argentina soybean
Trends in soybean protein content
© 2018 LMC International. All rights reserved. Feed protein vision
• Fishmeal is one of the world’s most important feed ingredients due to its nutritional profile.
• Fishmeal supply is restricted by Total Allowable Catch (TAC) quotas.
• Supply of fishmeal has been stagnant vs. strong demand growth, leading to a steadily rising price of fishmeal.
Fishmeal supply constrained by TACs
13
Global fishmeal output vs. prices Fishmeal vs. soybean meal prices
3
4
5
6
7
8
0
400
800
1,200
1,600
2,000
1992 1997 2002 2007 2012 2017
Pro
du
ctio
n, m
illion
s o
f ton
ne
sFis
hm
ea
l p
ric
e,
US
$/t
on
ne
Fishmeal price Fishmeal production
0
1
2
3
4
5
6
7
2001 2003 2005 2007 2009 2011 2013 2015 2017
Ra
tio
of
fis
hm
ea
l to
so
yb
ea
n m
ea
l
7x 5x 3.5x 2.5x Fishmeal:SBM ratio
© 2018 LMC International. All rights reserved. Feed protein vision
Protein content of PAPs PAP demand by region
PAPs are a reasonable substitute for fishmeal
• Although lower in protein than fishmeal (with the exception of HFM), they are a replacement for it.
• Aquafeed is the fastest-growing outlet of PAPs.
• In the EU, legislation and consumers’ attitudes towards PAPs have resulted in consumption falling. Demand
growth in the region ultimately depends on legislative relaxation,
14
0% 20% 40% 60% 80% 100%
Maize
Meat & bone meal
Poultry by-product meal
Fishmeal
Feather meal
Soy protein isolate
Protein content (% DM)
0
2
4
6
8
10
12
14
16
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Millio
n t
on
ne
s
South America North America Western Europe
China South East Asia Other
© 2018 LMC International. All rights reserved. Feed protein vision
• Corn gluten meal (CGM) is a protein-rich co-product of maize wet milling. It is mainly used in the pig, poultry and
aquafeed sector.
• Vital wheat gluten (VWG) is a high-protein co-product of wheat wet milling. It is increasingly being used in combination
with legume proteins as a replacement for fishmeal in aquafeed.
Protein content of CGM and VWG
Other plant proteins can gain from fishmeal supply issues
15
0% 20% 40% 60% 80% 100%
Maize
Corn gluten meal
Fishmeal
Vital wheat gluten
Soy protein isolate
Protein content (% DM)
• Output of both CGF and VWG is driven
by demand for starch and starch
derivative products.
• Increase in CGM and VWG supply is
therefore linked to the trends in this
sector.
New opportunities for meeting protein demand
© 2018 LMC International. All rights reserved. Feed protein vision
• As the world gets wealthier, people consume more animal protein in the
form of meat and fish. This will create more demand for feed protein.
• Due to cultural preferences and diverging trends in production costs, the
type of animal proteins that we will consume in the future is expected to
be different from the past.
• This will benefit poultry and, to a greater extent, aquaculture. These are
very efficient at converting feed into animal protein. The catch is they
need higher concentrations of protein.
• There is a range of high-protein feed ingredients available on the
market. However, their supply is constrained by different factors.
• This tension between demand and supply is opening up opportunities for
novel protein sources (insect, algae, single cell, etc).
17
© 2017 LMC International. All rights reserved. Sao Martinho, April 2017
This presentation and its contents are to be held confidential by the client, and are not to be disclosed, in whole or in part, in any manner, to a third party without the prior
written consent of LMC International.
While LMC has endeavoured to ensure the accuracy of the data, estimates and forecasts contained in this presentation,
any decisions based on them (including those involving investment and planning) are at the client’s own risk.
LMC International can accept no liability regarding information analysis and forecasts contained in this presentation.
© LMC International, 2018
All rights reserved
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