“We need less feed intake, less manure, less emissions, because that is where the complaints are,” said Daniel Berckmans. “That means we must be more efficient in the core equation.”

That “core equation” is his way of adding up animal feed needs: base metabolism plus activity, plus thermal or environmental regulation, plus mental state, plus the production of meat, milk or eggs.

Berckmans is a biosystems researcher out of KU Leuven university in Belgium and the University of Tennessee. He was among the speakers at a July 10 forum on precision livestock farming at the University of Manitoba.

Energy used by the base metabolism — basic functions of life like keeping organs running — can be calculated through heart rate. Berckmans said there are at least six companies working on a commercially feasible way to measure that, and technology for horses is likely to debut this year.

Animal activity can be tracked through things like aggression monitoring. Berckmans cited his previous work on a seven-year project, which found that aggression in pigs could be detected by measuring the distance between the camera and the pig’s back, “because they jump up,” he said.

Research has also been done on the energy horses expend when frustrated versus when calm. Berckmans pointed to data outlining energy expended while a horse was running in a ring alongside energy expended by brain activity at the same time. The horse was shown a bucket of food. When the horse realized it wasn’t going to get the food, it became frustrated and began to expend more mental energy.

Infection and disease can also cut production and profit. Sensors can help localize infection in a barn, compartment or room, potentially reducing disease spread and antibiotic use. Berckmans noted technology that monitors and analyzes the sound of coughs in a facility.

“Precision livestock farming gives us the data,” he said.

It can then be used to measure how far an operation is from desired outputs and to design prediction-based controllers.

“That’s what we do for decades in airplanes, in making mechanical systems, electronic systems,” Berckmans said.

While there’s been lots of research into agricultural use of precision technology, very little has been implemented, he said.

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The Canadian Food Inspection Agency (CFIA) has released their long-promised update to national feed regulations. Formally referred to as the “Feeds Regulations, 2024,” the final version of the framework was registered June 17 and published for public view July 3 in part 2 of the Canada Gazette.

“We’ve been waiting for this for over 14 years to get to where we are today,” said Melissa Dumont, executive director for the Animal Nutrition Association of Canada (ANAC).

The new requirements will be introduced gradually. Labelling rules and compositional and safety standards came into effect July 3, with a one-year transition period where industry can follow either the existing or new requirements.

Other rule changes were in force immediately. That included removing mink and foxes from the definition of livestock, approval and registration requirements, feed content standards, rules around feed for export, risk investigation procedures, record-keeping requirements and exceptions noted in both the Feeds Regulation, 2024 and the Feeds Act.

All other parts of the new rules will have a staggered rollout over the next 18 months, according to the CFIA website.

New complaint procedures, rules around recalls and packaging, regulations on imported feeds, traceability requirements and hazard assessments and preventative controls/control plans will be in the next wave, coming into force in June 2025.

Licensing requirements, export documentation, rules around import of a non-compliant feed and the new scope of livestock species will be some of the final parts of the regulations to come into force, slated for December 2025.

Industry in waiting

In 2010, ANAC approached the CFIA with a request to modernize feed regulations to be more in line with current industry realities.

There had been significant developments in animal nutrition knowledge, technology and customer requirements in the previous decades, industry argued, and it was time for the regulatory environment to catch up.

The 2024 regulations include a range of new and updated requirements touted to improve the safety of livestock feed, reflect international best practices, improve food safety and support innovation within the animal feed sector. The updated regulations will provide a transparent process for the approval and regulation of feed ingredients and feed products, the CFIA said.

“There are a lot of benefits that have come out of the new regulations,” said Dumont.

The previous regulations had last been reviewed in 1983, including nutrient minimums and maximums, and safety levels.

The new document is more flexible, allowing for easier change.

“One of the main things (about the new regulations) is that many of the documents are incorporated as reference. They’re still part of the law, they are referenced in the regulations, (but) they sit outside of the regulations. Through consultation processes, these documents can now be updated based on new science as it becomes available,” Dumont said.

Dumont said the new feed regulations will change some of the products that require authorization, which she said will increase focus on a safety and risk-based approach. She also expects they will improve trade opportunities.

Nutrient requirements have also gotten a modern polish.

“The minimum nutrient requirements were very old, and some of them actually required us to put too many nutrients in the feed,” Dumont said.

“The law was requiring us to do that. This has now given us that flexibility and it also takes, again, that risk-based approach by requiring feed businesses to have preventive controls in place, so to prevent risks and hazards as they occur, as opposed to dealing with them once they occur.”

Most farms will not be required to have preventative controls. That aspect of the regulations doesn’t apply to producers who produce non-medicated feed. Farms that mix medications into feed on-site farms will have to meet the regulatory standard, due to food safety concerns connected to medication residue in animals. If a farm has multiple species, is making their own feed and uses many different medications, it may need more complicated preventative controls.

“One of the changes is that we will be able to use veterinary health products in mixed feeds,” said Dumont. “If any company notifies veterinary health products to Health Canada and it goes through the process for approval, we will then be able to mix it in feed as long as it’s been approved for use in feed.”

It is Dumont’s hope that newly available tools will reduce the regulatory burden on producers. Much of that burden was not risk-based or food-safety-based, she argued, but simply hung on so long because regulations were so old.

Getting the word out

The CFIA has published guidance on the new rules. ANAC is also working with national producer groups to help them develop educational material for their producers.

The CFIA has scheduled two information sessions on the new rules: one in English on July 24 and another in French July 22.

ANAC also has their own voluntary certification program called FeedAssure, which meets the preventative control requirements in the regulations, Dumont said.

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The Canadian Dairy Commission announced Monday that its 4(m) milk class has been updated to allow dairy processors to get the 4(m) permit price for buttermilk incorporated in making skim milk powder sold for animal feed, effective Feb. 1.

The class is also now updated to include liquid buttermilk for animal feed as an eligible permit product in the 4(m) milk class, up to the set limit, the commission said.

Eligible end-uses for products sold in the 4(m) class already include skim milk powder bought either for direct feeding to farm animals, or for blending and repackaging into a feed blend. The class also includes the animal feed blends themselves, to be sold for feed as-is.

The expansion allows for inclusion of liquid buttermilk, whether evaporated or not, for direct feeding to farm animals.

Companies registered in Canada and using SNF-type products to make feed and feed blends may be eligible for a 4(m) permit. The limit under the 4(m) permit program for animal feed is now up to 20,000 tonnes of skim milk powder-equivalent per year.

The commission had originally announced Dec. 24, 2020 that it was considering such an update to the 4(m) class effective for Feb. 1 this year.

Prices for SNF sold in the 4(m) class are updated monthly and posted online, the commission said, noting that 4(m) butterfat is priced at the same level as butterfat in class 4(a). — Glacier FarmMedia Network

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The announcement comes amid rising global feed grain prices and tightening supplies, and as more companies work toward reducing the carbon footprint of their operations. Insects are seen as a sustainable alternative to fishmeal and other high-protein feeds.

The plant will produce 60,000 tonnes of animal feed protein annually from Hermetia illucens, a highly nutritional type of fly, along with 20,000 tonnes of oils for poultry and swine rations and 400,000 tonnes of fertilizer, the companies said in a release.

According to InnovaFeed, the insect is already endemic in Europe and is not considered to be a pathogenic or invasive species.

Construction of the facility at Decatur, about 230 km southwest of Chicago, is slated to begin next year, pending permits and approvals.

The facility will be built adjacent to ADM’s massive corn processing complex and will use corn byproducts as feed for the insects, as well as waste heat and steam from the corn processing plant. The collaborative scheme will emit 80 per cent less carbon dioxide than a stand-alone facility, the companies said.

“ADM Decatur’s corn-based co-products will be recycled locally to feed insects through infrastructure connected to the site. This production model will also allow InnovaFeed to use 27 MW of residual energy recovered from the ADM process, energy that was not previously recovered,” InnovaFeed said in a statement.

InnovaFeed also on Thursday launched an insect protein production site in Nesle, northern France, currently the world’s largest with a capacity of 15,000 tonnes of insect protein. It will ultimately feed the equivalent of 400,000 tonnes of fish, poultry and pigs.

The companies did not disclose how much they would invest in the Decatur project.

— Reporting for Reuters by Karl Plume in Chicago and Sybille de La Hamaide in Paris; includes files from Glacier FarmMedia Network staff.

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The closures highlight the pain for global agriculture companies from the outbreak of African swine fever in China, the world’s top hog producer and pork consumer.

African swine fever, for which there is no cure and no vaccine, kills almost all infected pigs, though it does not harm people.

The disease has killed more than a million pigs in China since the nation’s first reported case last August, cutting demand for feed ingredients such as soymeal and pre-mixes, which are blends of vitamins and other nutrients sold by Cargill and other suppliers.

“This is not a six-month trend for China to recover,” Chuck Warta, president of Cargill’s animal nutrition and pre-mix business, said in an interview. “This is a 24-month, 36-month kind of resetting of the world’s population of animals.”

The outbreak accelerated closures of Cargill feed mills in coastal regions of China that were also prompted by a westward shift over the past decade of the areas in which livestock are raised, Warta said. Most of the facilities will not be re-opened even if China gets African swine fever under control, he said.

Cargill closed three feed and animal-nutrition plants in the second half of the fiscal year that ended on May 31, representing an approximately 150,000-tonne reduction in capacity, according to the company.

But Cargill still sees a bright future for its animal nutrition business in China, Warta said. The company said it is spending US$65 million to replace a pre-mix plant in Nanjing and is also buying land for a similar facility in Henan province.

“We’re idling some assets, but we’re shifting those resources into a different type of production that is more positioned to serve the market,” Warta said.

Cargill reported on Thursday that reduced hog feed demand in China, along with the ongoing U.S.-China trade war and flooding in the U.S. Midwest, led to a 41 per cent slide in adjusted quarterly profits.

For the first six months of 2019, China’s soybean imports dropped 14.7 per cent from the same period last year as African swine fever curbed demand for hog feed, Chinese customs data showed on Friday.

Expectations for China to boost meat imports after losing hogs has caused some livestock producers in exporting countries to feed animals longer so that they grow bigger, Warta said.

— Reporting for Reuters by Tom Polansek in Chicago and Rod Nickel in Winnipeg.

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Neovia is majority owned by French cooperative group InVivo. Investment group Eurazeo also has a 17 per cent stake.

The acquisition, first reported by Reuters, would make ADM a major player in the global animal feed industry, which the company says has sales of more than US$700 billion.

ADM and rival grain merchants such as Bunge and Cargill have struggled in recent years as a global oversupply of food commodities has made it tough to turn a profit on their core business: buying, processing, and selling corn, soy and wheat.

The companies have been diversifying into higher-margin sectors, such as food ingredients and aquaculture feed, to compensate for the poor returns.

“We were happy with our animal feed activities but it was too local,” Pierre-Christophe Duprat, ADM’s president for Europe, Middle East and Africa, told Reuters. “If we wanted to expand we needed a more global approach.”

The acquisition would be ADM’s second largest to date after it purchased natural food ingredients company Wild Flavors for US$3 billion in 2014. Talks about a separate takeover of Bunge stalled this year, according to sources and media reports.

Neovia, which had sales of 1.7 billion euros (C$2.6 billion) in 2017, produces and sells a range of products related to pet care, aquaculture, livestock feed and other areas.

“If you’re management and your goal is to move away from the grain merchandising operations and the volatility that comes with that, this is the way to do it at a fair price,” said Seth Goldstein, equity analyst for Morningstar in Chicago.

Neovia has a limited presence in North America but a large one in Europe, Southeast Asia, and Central and South America, with 75 per cent of its sales coming from outside Western Europe.

This complements ADM’s animal nutrition business, which is primarily in the U.S. and has growing exposure in China, according to Fitch Ratings.

ADM is the most U.S.-focused of the major grain companies and has been trying to expand its geographic footprint.

The transaction can “serve as a platform for additional potential bolt-on acquisitions to expand the firm’s geographical reach,” Fitch Ratings said.

New unit

ADM would divert its feed activities into Neovia’s to create a new unit, called ADM-Neovia, with combined sales approaching US$3.5 billion, Duprat said. The takeover would lead to a reorganization and a likely reduction in staff in France, he said.

ADM said the deal would offer run-rate earnings before interest, taxes, depreciation and amortization (EBITDA) synergies of about 50 million euros by the fourth full year after the transaction closes.

The target seems “adequately conservative,” JP Morgan analyst Ann Duignan said.

The deal would be 100 per cent cash and is expected to be finalized in the fourth quarter of the year after a consultation process involving employee representatives and pending supervisory authority approval.

InVivo, France’s largest cooperative group, would use one billion euros expected from the sale to step up investment in new farming techniques and support acquisitions in wine, CEO Thierry Blandinieres said in an interview.

In another sign ADM is seeking to diversify its portfolio, the company said on Friday it would pay 185 million pounds (C$320.6 million) to buy Probiotics International Limited, better known under its umbrella brand Protexin, a Britain-based maker of probiotic supplements for people and animals.

— Reporting for Reuters by Sybille de La Hamaide and Tom Polansek; additional reporting by Gus Trompiz in Paris.

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Outlining its five-year plan for 2015-2020 for the grains and oils processing industry on Thursday, the state grain bureau said it would support the production of polylactide (PLA), a biochemical material made out of corn starch and sugar and used to produce plastic bags and tableware.

It also reiterated its plan to boost corn-based ethanol production by 2020.

The statement did not give any targets or further concrete details of the plan, but the document offers an insight into the government’s thinking and illustrates the depth of concern about the country’s large stockpile of ageing corn.

“The issue of grains oversupply is severe. The task to digest grains storage is arduous,” the statement said.

China has built up huge state stockpiles of corn after years of buying the crop from farmers to support incomes.

After abandoning the policy earlier this year, it began to sell off its old stock but still has more than 200 million tonnes in warehouses, according to some estimates, but much of it is poor quality.

If it is no longer fit for human consumption, processors will have to find alternative uses for the grain.

By 2020, China will have more than 30 major grains and oils enterprises with annual income exceeding 10 billion yuan ($1.44 billion), the statement said.

That’s almost double the number of companies operating in the sector in 2015.

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