African poultry The first report concerned a RaboResearch Food & Agribusiness report headed ‘Opportunities Remain Wide Open for African Poultry Investments’. Compiled by the organisation’s Senior Animal Protein Analyst, Nan-Dirk Mulder, the report suggests that African poultry has real investor potential, a message which can only be good for our own industry. “Following a short slowdown caused by economic volatility in mineral
and oil-dependent countries in 2016, we have seen an acceleration of poultry investments in Africa since 2017, with Eastern Africa and parts of Western Africa, like Nigeria and Ghana, attracting greater interest from local and international investors,” stated Mr Mulder. “Several international companies have developed their positions in Africa. This includes modern retail and restaurant chains continuing their expansion; animal nutrition companies strengthening their positions throughout Africa; breeding companies establishing a more pan-African supply system, and equipment suppliers building distribution networks. “Production is still dominated by local companies and
internationalisation is managed by a few large African investors. But early international investors are taking positions to leverage the future growth path of Africa – one of the world’s largest pending growth markets (accounting for around 15% of the upcoming 20-year growth in global poultry).” He also pointed out that the middle class in Africa is expected to
continue growing, as the population doubles and more people move to big cities. These core fundamentals, together with the untapped potential of local feed grain production, offer an attractive investment opportunity. “This will all lead to ongoing market growth and especially toward
more products being sold via modern distributors and online platforms,” he stated. “Modernisation at all stages of the value chain will continue, and such an environment will create an increasingly interesting platform for international investors.” There is a business health warning, however, that investors need to realise that conditions in Africa can be challenging and require a very
strategic investment assessment that takes all major factors (i.e. business climate, market growth, supply and infrastructure) into consideration. If this is done well, however, the potential upside is big.
Asia Food Challenge report The second document is a new Asia Food Challenge report, compiled by Rabobank, PwC Singapore and Temasek International, whose joint view is that Asia is at a crossroads with huge growth in demand creating an attractive opportunity for investment, but with collective action being required to unlock this opportunity. The potential is obviously enormous with Asian consumers set to
more than double their total spend on food over the next decade, from US$4 trillion in 2019 to over US$8 trillion by 2030. “By 2030, 65% of the world’s middle-class population will reside in
Asia,” the report stated. “These consumers will ask more of their food supply chains, seeking highly nutritious, fresh and safe produce delivered conveniently and on demand. They will also pay a premium to businesses able to deliver on this.” The point is also made, however, that Asia’s agri-food industry is
struggling to keep up with such demand, not least in terms of the growing requirement for meat. “Meat consumption, though plateauing in developed markets,
will continue to grow in most of Asia,” stated the report. “Asia’s meat consumption, on a per capita basis less than half that of Europe, is due to expand over the next decade; reaching 176 million metric tonnes by 2030. “This prospect will automatically also raise animal feed demand,
impacting the global supply chain for feed grains and oilseeds. Asia’s capacity constraints to meet demand for meat will likely increase the supply gap to 16.9 million tonnes from 14.5 million tonnes today.” A taster, no more, from this excellent report, which will definitely repay your reading. Asia Food Challenge -
https://www.rabobank.com/en/raboworld/articles/
harvesting-the-future-the-asia-food-challenge-report.html
PAGE 14 MARCH/APRIL 2020 FEED COMPOUNDER
Comment section is sponsored by Compound Feed Engineering Ltd
www.cfegroup.com
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