AMINO ACIDS REPORT

September 2019

Indication Prices

(average cost and freight to Durban)

L-Lysine HCI

ZAR 16,85

L-Lysine sulphate

ZAR 11,30

L-Methionine

ZAR 32,90

L-Threonine

ZAR 17,45

L-Tryptophan

ZAR 90,40

L-Valine

ZAR 49,00

L-Arginine

ZAR 101,85

Headlines

China and South East Asia

  • China’s agriculture ministry has stated that the danger from the fall armyworm pest is finally over for this year’s crop.
  • The damage inflicted by African swine fever on China’s pig industry may have been far worse than expected as official estimates show 1,2 million pigs have been culled since August 2018, but local livestock data signal a drop of as many as 100 million hogs over the period.
  • A city in southern China is selling pork at discounted prices to help consumers cope with high prices. People in Nanning, the capital of the south-western Guangxi region, can buy up to 1 kg of pork a day at a discount of more than 10% on the average market price.
  • China has launched an investigation into reports that farmers are using illegal experimental vaccines against African swine fever.
  • Beijing has asked local governments to expand subsidised loans to pork farmers and increase insurance levels. China will extend a programme that offers subsidised loans to breeding farms and large-scale farms, and expand it to cover more farms to facilitate a recovery in production. China will also step up subsidies for hog equipment in a desperate attempt to increase production. The new measures are aimed at supporting pig farmers in purchasing equipment for disease prevention, waste treatment, environmental controls and automated feeding. The subsidies (to be at least CNY 500 000 (ZAR 1,06 million) but no more than 30% of the total project investment) must be issued by the end of 2020. They can also be issued to farms seeking to expand production capacity. China’s state council has stated that it wants large-scale pig farms to make up 58% of the total by 2022 to help improve stability of pork supplies.
  • Chinese health inspectors have evaluated and approved four Brazilian beef plants as net exporters in an attempt to increase meat supply in China amid an outbreak of swine fever.
  • China’s customs have allowed imports of soybean meal, rapeseed meal, sunflower meal, and sugar beet pulp from Russia. The trade move came after China approved more soybean, wheat, and barley imports from Russia, as a festering Sino-United States (US) trade war curbed American agricultural shipments. China will secure sufficient pork supplies for the upcoming holidays, including the Lunar New Year festival in late January, with China’s Guangdong Province stating that it will release 3 150 t of frozen pork from reserves during the upcoming holidays. China will also auction 10 000 t of pork in September in an attempt to increase market supply before the holiday season.
  • China’s plan to implement a nationwide mandate for ethanol-blended gasoline in 2020 is in doubt after a significant decline in the country’s corn stocks. State stockpiles of corn, the main raw material for ethanol production, have fallen to around 56 million tonnes currently from more than 200 million tonnes in temporary reserves. Beijing’s plan for all of the country’s gasoline to be made with a 10% blend of ethanol would require about 15 million tonnes of the biofuel annually, or some 45 million tonnes of maize, about 16% of the country’s current consumption.
  • African swine fever has been reported in Hong Kong with three new three cases being confirmed in the Sheung Shui Slaughterhouse on 3 September.
  • Vietnam has culled about 4,7 million pigs to contain an outbreak of African swine fever that has spread to all 63 provinces in the south-east Asian country.
  • The Republic of South Korea (hereinafter referred to as South Korea) confirmed its ninth case of African swine fever in a town near its border with the Democratic People’s Republic of Korea (or North Korea).
  • The Philippines’ Department of Agriculture has revealed more cases of African swine fever outbreaks in the country, such as in a village in Antipolo City, Rizal Province, east of Manila, and some areas in Central Luzon.
  • Indonesia has revised rules that will allow imports of chicken and poultry products from Brazil following a World Trade Organization (WTO) ruling. Brazil launched a WTO complaint against Indonesia in October 2014 over claims that its rules and procedures hampered entry. A WTO dispute panel ruled that four Indonesian policies violated WTO rules.
  • Thai poultry exports to China have surged eightfold this year due to the decline in pork numbers across the nation.
  • African swine fever in South Korea may come as a boon for US pork farmers as lower local supply may spur demand for imports. South Korea was the fifth-biggest importer of American pork in 2018, with USD 670 million (ZAR10 billion) in purchases.

Headlines

Europe

  • European Union (EU) exports of agri-food products reached EUR 138 billion (ZAR 2 trillion) in 2018, confirming its position as the largest global exporter of agricultural products for yet another year. Agricultural products represent 7% of the value of EU total goods exported in 2018, ranking fourth after machinery, other manufactured goods and chemicals. Agriculture and food-related industries and services together provide almost 44 million jobs in the EU. The food production and processing chain accounts for 7,5% of employment and 3,7% of total value added in the EU.
  • Spanish food safety officials have informed the European Commission of a discovery of a too high a count of lead residues in a shipment of Indian manganese oxide. This is the second notification of this type in less than a month. Lead traces found by the border control authorities in samples amounted to over 500 mg/kg. The cargo was estimated at around 75 t.
  • Belgian food and feed safety officials notified the European Commission that higher-than-permitted residues of the coccidiostat Robenidine have been detected in a consignment (8 t) of domestically produced premix intended for export to Estonia. According to the Belgian Federal Agency for the Safety of the Food Chain (FASFC) , the consignment was distributed but is now detained.
  • A dispute between Irish farmers and processors over beef prices that has cut production and caused a wave of temporary layoffs, could hit exports from one of the world’s largest suppliers. The dispute, which began in late July with the picketing of meat factories by a grassroots group of farmers, worsened when representatives of processors walked away from a meeting the government had initiated in an attempt to resolve the impasse. Meat Industry Ireland has stated that its members had temporarily laid off 3 000 employees after the blockading of their factories, which resulted in the closure of some 80% of overall processing capacity.
  • Dutch food and feed safety officials have notified the European Commission that traces of arsenic (132 mg/kg) have been detected in samples taken from a cargo (24 t) of feed grade zinc oxide imported from Turkey.
  • Hungary’s national food safety authority, the National Food Chain Safety Office (NÉBIH), have reported five cases of African swine fever in wild boar carcasses near Budapest.
  • Russia’s agriculture ministry expects China to open its market for imports of wheat produced across Russia within a year, with further hopes that Russian beef and pork exports are allowed to follow shortly. China’s customs have allowed imports of soybean meal, rapeseed meal, sunflower meal, and sugar beet pulp from Russia. The trade move came after China approved more soybean, wheat and barley imports from Russia, as a festering Sino-US trade war curbed American agricultural shipments.
  • Russia’s Cherkizovo Group has opened its sixth pig farm in the Penza region, a strategic location for its pig production business. The farm, like Cherkizovo’s other farms in the Penza area, is designed to house more than 20 000 pigs at a time, or up to 40 000 market hogs per year.
  • A new outbreak of African swine fever has been found at a privately held farm in a village in Russia’s Primorsk region near the border with China.
  • Ukraine had harvested around 41 million tonnes of grain by 16 September. It expects its total 2019 grain crop to be in line with last year’s level of around 70 million tonnes. Farmers have harvested 10,3 million hectares of grain (or 68% of sown area), with the yield averaging 3,95 hectare/ha.

Headlines

The Americas

  • Brazil is expected to introduce a tariff-free wheat import quota of 750 000 ts per year starting from 2020. Brazil announced the opening of the tariff-free wheat import quota earlier this year in connection with President Jair Bolsonaro’s visit to the United States, with the US wheat producers seen as potential beneficiaries. Despite being an agricultural powerhouse, Brazil remains a net importer of wheat, since its tropical climate still poses a huge challenge when considering the expansion of wheat cultivation. Brazil imported 3,9 million tonnes of wheat in July this year.
  • The area in Brazil to be planted with soybeans in the 2019/2020 season, which starts this month, will grow by the slowest pace in 13 years as a global trade war and swine fever in China cloud the outlook for farmers. Brazil’s soy plantings are expected to expand by just 1,1% to 36,3 million hectares, well below the average annual growth of 5,2% over the past decade. Brazilian soybean exports are down 11,4% in the first eight months of the year, compared to the same period of 2018, however output is expected to increase by 5,5% compared with the previous crop to a record 121,41 million tonnes.
  • Brazil’s Ministry of Agriculture has announced that 25 meat processing plants in the country have received authorisation to export to China. In total, 17 plants were cleared for beef exports, including four from meat processors Marfrig Global Foods SA and Minerva SA. Minerva said in a statement that its two plants have a capacity of 3 500 cattle per day. Marfrig said its chosen facilities are located in Mato Grosso state.
  • Argentine soy farmers and crushers expect a boost in demand next year after the South American grain giants won long-sought approval from China to export soymeal, its top commodity, to the world’s biggest consumer of the livestock feed. The deal paves the way for Argentine farmers and soy processors to start sending shipments to China from early 2020 once required plant approvals and registrations have been made.
  • US premium meat firm Strauss Brands LLC announced this week that it will be building a new headquarters and meat processing plant in Milwaukee, Wisconsin. Construction is expected to begin on the 175 000-square foot facility later this year, allowing it to enter into operations by 2021.
  • The practice of garbage or waste feeding to swine will be prohibited in Oklahoma starting 1 November. Garbage feeding has been considered too great a risk to warrant, as producers worry about foreign animal disease transmission to the swine industry through garbage feeding.
  • Poultry processor Sanderson Farms Inc has received a subpoena from the United States Department of Justice (DOJ) related to the regulator’s investigation into the broiler chicken antitrust case. This subpoena comes following the DOJ’s criminal probe into allegations that Tyson Foods, Inc. (Tyson Foods) and other poultry processors, including Sanderson Farms, colluded to fix poultry prices.
  • The United States Department of Agriculture (USDA) announced that it would probe beef pricing fluctuations in the wake of an August fire at a Kansas cattle processing plant, which sent prices for cattle sharply lower at the same time wholesale beef prices jumped.
  • American fast food chicken company Chick-fil-A has proclaimed that ‘no antibiotics ever’ (NAE)-chicken has been rolled out to all of its more than 2 400 US restaurants.

Headlines

Australasia

  • Inghams Group Limited shares were down as much as 1,4% amid concerns of a possible poultry virus on New Zealand’s South Island. Inghams says all of its chicken farms are in the North Island and none of its farms are affected.
  • Australia’s cattle numbers will fall even more than had been expected this year, thanks to persistent drought in the industry’s east coast heartland, with a high rate of cow slaughter undermining hopes for herd rebuilding. Australia are expected to close 2019 at 24,48 million head of cattle, the lowest figure in 31 years.

Markets

  • The US and China are in the midst of a trade war and following an outbreak of African swine fever in China, US meat heavyweight Tyson Foods stands to benefit. By July, the number of hogs in China—by far the world’s largest pork consumer—was close to a third lower than a year earlier. As a result, wholesale pork prices are skyrocketing, up roughly 60% on the year. As a consequence, the pork shortage is pushing up prices of other animal proteins like beef, eggs, and lamb. For much of 2019, US pork has faced Chinese tariffs upward of 50%. However, the value of US meat exports in aggregate was still up 8.3% on the year in June, the fastest growth since May 2018. The enormous pork shortage is sucking meat into China at an astonishing rate. Total meat imports in July were USD 1,7 billion (ZAR 25,7 billion), up close to 90% from the year before.
  • Meat processor Tyson Foods has stated that the poultry business contributed to about half of its 2019 earnings forecast cut. The company has lowered its 2019 adjusted earnings to between USD 5,30 and USD 5,70 per share (ZAR 80,30 to ZAR 86,35 per share), from a prior forecast of USD 5,75 to USD 6,10 per share (ZAR 87,11 to ZAR 92,41 per share), citing a range of reasons, including a recent fire at its Holcomb slaughterhouse and volatility in the commodity market.
  • World food prices fell for a third month running in August, pushed down by a sharp drop in the prices of sugar, wheat and maize. The Food and Agriculture Organization of the United Nations (FAO) food price index, which measures monthly changes for a basket of cereals, oilseeds, dairy products, meat and sugar, averaged 169,8 points last month from an upwardly revised 171,7 points in July. That figure was previously given as 170,9. The FAO also predicted that cereal supplies would be more abundant in the 2019/2020 period than previously expected. The FAO cereal price index plunged 6,4% in August, month-on-month, thanks to big drops in the prices of wheat and major coarse grains, especially maize. By contrast, rice prices rose. Sugar prices also fell markedly in August, dropping 4% on the previous month. These drops failed to offset climbs in other indices, with the vegetable oil price index gaining 5,9% and both meat and dairy prices posting increases of 0,5%.
  • The future of US corn is yet to be decided, but the outcomes depend from who’s perspective it is being viewed from. With US corn farmers being hammered by the trade war with China, President Trump has said Japan—its own crop hurt by a bug infestation—will buy enough to pick up the slack. However, not everyone in Japan seems to agree. Agriculture specialists say the bug problem is not severe enough to affect import demand. Feed maker Feedone Co., Ltd. already relies mostly on corn imports, so losses to the domestic crop would not change its demand for American corn. Although China has never been a large corn buyer, its dramatic reduction in purchases of US soybeans over the past year persuaded many farmers to switch soybean planting to corn; the result then being an oversupply of corn in the US.
  • Sanderson Farms, Inc. shares slipped on the first trading day after the poultry processor disclosed investigators are looking into how it priced its chickens.
  • China will allow the import of soymeal livestock feed from Argentina for the first time under a deal announced by Buenos Aires, an agreement that will link the world’s top exporter of the feed with the top global consumer. The pact will be signed by Argentine and Chinese officials in Buenos Aires. Last month, Chinese officials inspected Argentine soymeal factories in the run-up to signing the pact. Argentina had tried for years to break into the Chinese market, the biggest consumer of the meal it uses to feed its massive hog herd. However, China has its own crushing industry to protect and therefore had steadfastly resisted. The US–China trade war strengthened Argentina’s position, though, forcing China to expand its soymeal import options.
  • Sixteen types of US products were exempted from additional retaliatory tariffs by China, including whey and fish meal, which are fed to animals, and some lubricants. The exemption will take effect on 17 September and be valid for a year through to 16 September 2020.
  • Pork prices in China may rise further, even after surging 93% year-on-year in August amid an outbreak of African swine fever, as relief from policy measures to release emergency reserves and boost imports has been limited.
  • Shares of South Korean animal medicine suppliers and feed makers surged after the country reported multiple outbreaks of African swine fever in the region. Cheil Bio. Co., Ltd. rose by 30%, hitting the daily price limit. Animal feed maker Woosung Feed Co., Ltd. gained nearly 17%. Shares of chicken-related firms, including Maniker Co., Ltd. and Harim Co., Ltd., also soared to nearly 30% each, as investors saw higher sales of chicken products instead of pork.
  • After reporting a month ago that DuPont might be selling it nutrition and biosciences unit, Bloomberg is now saying Royal DSM is considering making an offer for the business.
  • Following President Donald Trump’s action of sending to congress his intent for the US to ratify a free trade agreement with Japan in the coming weeks, the president of the American Feed Industry Association (AFIA) said, “AFIA is pleased the administration has reached an initial trade agreement on tariff barriers with Japan and intends to enter into the agreement in the coming weeks. We are hopeful this agreement will show progress in bringing the US animal food industry closer to the level of tariff treatment Japan affords our competitors in the recently implemented Comprehensive and Progressive Agreement for Trans-Pacific Partnership. We are eager to review the final text and for further developments in subsequent bilateral negotiations with Japan.”
  • President Trump and Japanese Prime Minister Shinzo Abe signed a trade-enhancement agreement granting market access to American food and agricultural products by eliminating or reducing tariffs. Japan will open its markets to approximately USD 7 billion (ZAR 106 billion)in US agricultural products.
  • Stratégie Grains increased its forecasts sharply for EU soft wheat production and exports for the second month in a row, pointing to strong harvest results in France and Britain and brisk shipments from Romania and Bulgaria. The French-based consultancy now sees 2019/2020 soft wheat production in the 28-country European Union at 144,5 million tonnes, up from 142,9 million tonnes projected in August and approximately 14% above last year’s drought-hit crop. The upward revision, after Stratégie Grains already raised its soft wheat harvest estimate by over two million tonnes last month, reinforces a market consensus that EU wheat crops mostly escaped damage from record-breaking heatwaves this summer.
  • China’s soybean imports from the US in August rose sixfold from a year earlier, as cargoes that were purchased earlier amid an easing in the trade dispute between the countries cleared customs. China, the world’s top buyer of soybeans, brought in 1,68 million tonnes of the oilseed from the US in August, up from 265 377 tonnes a year ago. That was up 84% from last month’s figure of 911 888 tonnes.
  • No new pork sales to China were reported by the USDA in its export sales report, despite indications China had begun to make ‘good will’ purchases of US soybeans ahead of a high-level meeting in Washington in October.
  • China took in 162 935 tonnes of pork in August, up 76% from August 2018 but down from July’s 182 227 tonnes. Chinese importers bought around 600 000 tonnes of US soybeans for shipment from Pacific Northwest Terminal in Washington state, US, from October to December. China has granted new waivers to several domestic state and private firms exempting them from retaliatory tariffs on soybeans imported from the United States.
  • After almost 20 years, South Korea lifted its import restrictions on beef and beef products from the European Union. Producers from Denmark and the Netherlands will be the first countries to be able to resume exports.

Corporate headlines

  • Grain traders Archer Daniels Midland Company (ADM) and Bunge Limited said in separate statements that they do not source crops from newly deforested areas in the Amazon and are using satellite monitoring to enforce their policies. Bunge said it is evaluating available information about the number and location of the existing Amazon rainforest fires. Brazil’s oilseed crushing association Abiove (Associação Brasileira das Indústrias de Óleos Vegetais, or the Brazilian Association of Vegetable Oil Industries), which represents companies such as ADM and Bunge, has said soybean plantings in the 10 towns that reported the most fires is immaterial to overall soybean production.
  • Tyson Foods announced that it has reached a deal to invest in Brazilian poultry producer and exporter, Grupo Vibra. This will give Tyson Foods a 40% stake in the South American company’s foods division.
  • Russian state-controlled VTB Bank has been expanding its grain business and plans to enter the grain markets in Africa, the Middle East and Asia to increase Russian grain exports. VTB, Russia’s second largest lender, has recently become the largest operator of the country’s grain export infrastructure and is building its own export arm after buying large local grain trader Mirogroup Resources in August.
  • China Mengniu Dairy Company Limited and a unit of Russian business conglomerate Sistema may create a joint venture to build dairy farms in the far eastern region of Russia. China’s Zhongding Dairy Farming is expected to become a third partner in the project which envisages total investments of up to USD 682 million (ZAR 10,3 billion).
  • Tyson Foods’ fire-damaged beef-processing plant will likely be back online by January, chief executive officer Noel White says, and some processing has already resumed in a portion of the plant untouched by last month’s fire.
  • Canadian grain company Parrish & Heimbecker, Limited has acquired 10 locations of Louis Dreyfus Company, as part of a plan to grow its grain supply chain across the country. The deal will help the Winnipeg, Canada-based firm expand its grain and crop input business in new geographies.
  • French feed supplier Caste Aliment has acquired nearby Galibert, a small-sized organic farm-animal feed manufacturer based in Naucelle, in southern France. Caste Aliment’s production site in Mirandol will be solely producing conventional feeds, while the Naucelle factory will be dedicated to organic feed manufacturing; a segment which grew 18% between 2016 and 2017. Founded in the 1950s, Caste Aliment produces approximately 60 000 tonnes of feed per year. Galibert, meanwhile, manufactures 10 000 t per annum. The Naucelle-based company employs 32 staff.
  • Meat processor Tyson Foods has announced the completion of an investment by its corporate venture subsidiary, Tyson Ventures, in plant-based shellfish maker, New Wave Foods. New Wave Foods produces plant-based shrimp made from seaweed and plant protein, which it plans to have market-ready by early 2020.
  • Brazil’s leading meat export industry group and other agribusinesses have joined with non-government organisations (NGOs) to call for an end to deforestation on public lands, demanding government action as the Amazon rainforest burns. The Brazilian Beef Exporters Association (ABIEC) and NGOs Imazon and IPAM (Instituto de Pesquisa Ambiental da Amazônia or the Amazon Environmental Research Institute), are among the 11 Brazilian groups signing on to a campaign that also calls for protected conservation areas in the country to be maintained and the creation of a justice ministry task force to resolve conflicts over public land.
  • Vinh Hoan Corporation has officially started building a USD 2,07 million (ZAR 31,36 million) fingerlings hatchery in Vietnam, which will also include research and development and production facilities. The nursery and hatchery will be designed to supply fingerlings to Vinh Hoan’s farms as well as the market.
  • Impossible Foods, a California-based producer of meat substitutes made from plants, is actively working to speed up its entry into China. The firm has already launched its products in Hong Kong and Macau and now ships to 450 restaurants in Asia but is seeking to boost its presence in the Chinese mainland, where meat production is harder as a result of land and water shortages.
  • Denkavit has announced it is planning to acquire 100% of Grober Nutrition LLC, the US subsidiary of Grober Nutrition. Grober Nutrition LLC is a supplier of young animal nutrition and feed ingredients company in Auburn, New York.
  • Australian veterinary company Apiam Animal Health has announced the purchase of Australia’s largest custom vaccine and diagnostic laboratory services business Animal Consulting Enterprises Pty Ltd for USD 11 million (ZAR 166,7 million). The acquired company, which goes by the name of ACE Laboratory Services, produces autogenous vaccines, meaning bespoke products only available through a farm’s prescribing veterinarian and used when commercial vaccines are unavailable or not effective.
  • ForFarmers in the United Kingdom has announced the official opening of its redeveloped feed mill in Exeter, Devon. The Exeter feed mill underwent a rebuild and restructuring process over the last two years in order to increase the mill’s output capacity from 140 000 to 300 000 tonnes of animal feed a year.
  • Top European pork producer Danish Crown opened a plant near Shanghai to produce packaged pork for the area’s affluent consumers. The company’s first factory in China will turn frozen pork imported from Denmark into packaged, chilled product as well as bacon and sausages.
  • Commodities trader and food processor Bunge Limited stated that it had bought a 30% stake in Brazilian company Agrofel Grãos e Insumos, which sells agricultural supplies in the southern state of Rio Grande do Sul.
  • Cargill has agreed to sell its ownership and economic interest in CarVal Investors LLC, an alternative investment fund manager and independently managed subsidiary of Cargill, to a partnership comprised of the firm’s senior management team. Terms of the sale were not disclosed. The transaction is expected to close in the fourth quarter of 2019.
  • Zambeef Products PLC (Zambeef) has reached an agreement with Chenguang Biotech (Zambia) Agri-Dev Limited (Chenguang) to sell its Sinazongwe Farm for USD 10 million (ZAR 151,50 million). The deal does not include the site’s feedlot and abattoir, which will remain in the ownership of Zambeef. Sinazongwe Farm is located in the southern Zambezi valley of Zambia, about 70 km south-east of Choma town. The farm was acquired by Zambeef in 2003 for approximately USD 2,3 million (ZAR 34,8 million).
  • Tyson Foods has expanded its existing facility in Camilla, Georgia, creating 100 new jobs with an investment of USD 34,2 million (ZAR 518 million).
  • Cargill may close its fresh and frozen whole turkey production operations in November at its plant in Waco, Texas. The plant was established in 1965. It is understood that approximately 27 000 turkeys are processed at the facility each day.
  • Benchmark Holdings PLC-owned Akvaforsk Genetics Centre AS and SalmoBreed AS have merged to establish Benchmark Genetics Norway AS. The combined organisation will further strengthen Benchmark’s offering to deliver continuous genetic improvements and support aquaculture producers to increase quality, yield, health, and welfare.
  • Novogen, a subsidiary of Groupe Grimaud has acquired a poultry hatchery in Gare d’Uzel in Brittany, France, housing grandparent stock production for global distribution, and parent stock for the Europe, Middle East, Africa and Asia (EMEA) region. The hatchery, located near Novogen’s Plédran headquarters, is expected to be put into operation in early summer of 2020.
  • Jamaica Broilers Group of Companies has reportedly concluded the purchase of a processing plant in South Carolina previously operating under Gentry’s Poultry Company Inc. As Gentry’s, the plant produced smaller chickens, from 2,5 to 3,5 pounds dressed, in either whole bird, eight-piece cut, leg quarters, boneless skinless breasts or other formats. It has capacity for ice packing, CVP (controlled vacuum packed), or carbon dioxide packing. Jamaica Broilers will be rebranding the products from the plant as ‘The Best Dressed Chicken’ line.
  • French oilseed group Avril and farm cooperative Terrena will launch a new business next year to produce meal for animal feed and organic vegetable oil. The project, called Oleosyn Bio, aims to secure supplies and prices over several years.
  • Due to a poor market situation resulting from the outbreak of African swine fever and its impact on the corn refined products, Global Bio-Chem Technology Group Company Limited announced it has decided to suspend production at Harbin Dacheng Bio-Technology Co., Ltd., an indirect wholly-owned subsidiary of the company. Harbin Dacheng is principally engaged in the manufacture and sale of corn starch, gluten meal, corn oil and other corn refined products.
  • French meat processor Bigard Group has reportedly made an offer for Nestlé S.A.’s charcuterie business, Herta, which was put up for sale by the Swiss giant earlier this year. Nestle, however, considered the offer too low.
  • P. Pokphand Co. Ltd., one of China’s top five pig producers, is speeding up expansion of its business. The company, part of Thai conglomerate Charoen Pokphand Group, plans to raise 10 million pigs a year by 2021, up from 4 million currently.

Research and technology

  • Beyond Meat tested plant-based fried chicken at a Kentucky Fried Chicken outlet in Atlanta and sold out in five hours. It was another win for the start-up, which at last count had products in over 53 000 outlets. The chicken foray also demonstrates that the alternative meat industry’s initial beef-mimicking products are just the start for plant-based protein.
  • ECO Animal Health (ECO), a wholly owned subsidiary of ECO Animal Health PLC group, has entered into a worldwide exclusive research partnership with The Pirbright Institute in the United Kingdom, to develop a novel biopharmaceutical to protect chickens from infectious bronchitis virus (IBV). The global poultry biologicals market is worth USD 2,3 billion (ZAR 34,8 billion) with a compound annual growth rate of 5% to 6 % predicted. The IBV segment is currently worth USD 190 million (ZAR 2,8 billion).
  • Hill’s Pet Nutrition, part of Colgate Palmolive, is expanding its research facility in Topeka, Kansas. The new venture is a big strategic investment towards the clinical understanding of nutrition required for small dogs and small pets, which is the fastest-growing trend around the world.
  • HatchTech B.V., a global provider of incubation technology, and Pas Reform Hatchery Technologies, a global supplier of integrated hatchery solutions, have entered into a long-term global strategic patent agreement covering post-hatch early feeding for day-old chicks. It underlines the importance of early feeding for the production of robust day-old chicks and promotes the worldwide growth potential of this innovative concept.
  • A new Emirati initiative called Mawashi seeks to increase the profitability and sustainability of animal agriculture in Abu Dhabi by providing world-class service in categories including nutrition, health, breeding, record keeping and administration, among others. Mawashi will help farmers grow their herds, increase the production of the core heard, produce more offspring, become more profitable and, ultimately, keep these animals sustainable over time.
  • DuPont Animal Nutrition has announced the launch of Axtra® PHY in Japan.
  • Insect processing start-up Ynovéa last week launched its industrial-scale factory for the production of finished feeds in Naves, in central France. Bringing online production capacity of 200 t per month, the new plant transforms insect larvae raised, killed, and dried by its European suppliers into ready-to-deploy, patented nutritional products.
  • Huvepharma’s Monovet® 90, the first FDA-approved generic monensin in July 2019, has now also received US Food and Drug Administration (FDA) approval for combination use with other drug-based products in the manufacture of Type B and C medicated feeds, such as tylosin, ractopamine and melengestrol.
  • The Archer Daniels Midland Company announced a USD 2,5-million (ZAR 37,9 million) gift to assist construction of the University of Illinois’ Feed Technology Center, a key asset that will advance educational and research opportunities within the College of Agricultural, Consumer and Environmental Sciences at the university, and will advance animal agriculture and companion animal nutrition across the globe.

Charts

As expected, lysine prices remain weak. Some Chinese producers have cut output in an effort to limit losses, but this failed to support the market. Despite an expanded broiler flock, demand remains weak due to much diminished hog feed production. Two major European producers have announced price increases, while a third has withdrawn current offers. The European market seems to have strengthened somewhat.

Improved demand from the poultry sector has stabilised demand in the Chinese market. Supplies are adequate to tight and this has supported prices. Expect stable to slightly stronger prices. In contrast, European prices are stable to weaker with ample supply in the market.

Threonine prices seemed to stabilise early in September on the back of improved export demand, but by mid-September prices tested a new low due to oversupply and poor local Chinese demand. As producers started to cut output, prices stabilised, but are expected to remain weak.

Valine prices have continued to remain stable, with limited dips in the Chinese market. Availability is adequate with no real pressures to either side at the moment. Chinese demand could pick up with a growing poultry flock, but that remains to be seen.

The August trend of falling prices has continued into September with further drops, albeit smaller than in August. Some producers have indicated production cuts, but with poor demand this is unlikely to turn the tide around but could at least stabilise the market.

For more information

contact Heinrich Jansen van Vuuren
heinrich@chemunique.co.za

This report contains information supplied by and compiled from eFeedLink and Feedinfo.
Detailed reports and references are available on request.

Synthetic amino acids

L-Valine

Synthetic amino acids

L-Tryptophan

Synthetic amino acids

L-Methionine

Synthetic amino acids

L-Lysine

Synthetic amino acids

L-Arginine

Synthetic amino acids

L-Threonine