News: Greater Europe
In an effort to increase awareness of U.S. Soy and demonstrate commitment to the growing swine industry customers from Romania, a group of technical experts visited with pig integrations on behalf of USSEC during the third week of April. The goal of the mission was to understand the past years’ developments in the Romanian swine sector and to offer technical support in pig nutrition, feeding and management to fast-developing swine integrations. With a pork meat consumption of 20 kilograms (kg) per capita, Romania is way under the European average of 46.4 kg per capita, which paves the way for an increase in pork consumption in the coming years.
Due to similarities in the industry’s development stages and taking into account the leading role and expertise of Spain among the EU and world pig meat production, USSEC invited high profile experts Dr. Josep Gasa, professor of Animal Science at University Autonomous of Barcelona and Dr. Gonzalo Mateos, professor at the Universidad Politécnica de Madrid, for onsite technical training for swine farm managers, nutritionists and production staff.
Field visits organized at two swine integrations and one fattening farm facilitated interactions with farm managers and feed specialists. USSEC experts learned from discussions that after a period of stagnation, the swine industry showed a constant increase for the past four years and reached a point where the local breeding farms are not able to supply the rapidly increasing piglets’ demand from the pig fattening farmers. Swine breeding farms are currently established through local or foreign investments and receive strong support from EU funding.
“Due to the rapid development, there is a shortage of qualified personnel at the level of the newly established sow farms, where the required level of technical skills is much higher than the qualification needed for fattening pigs,” said Dr. Mateos. “As one of the top EU grain producers, Romania’s annual production is around 20 million tons; out of this, 60 percent is exported as raw materials to Western European or Middle Eastern countries. Due to the increasing availability of grains, the meat production should expand and this offers excellent opportunities to the Romanian swine industry. However, the feed and livestock industries are confronted with the availability of high quality vegetal protein sources, among these, soybean meal is the main quality protein used in animal feeds. This challenge should be answered by keeping a constant supply of U.S. Soy for the Romanian feed industry,” Dr. Mateos added.
Even if still fragmented, the pork meat production in Romania is the largest and most important sector of livestock production in the country, while the commercial swine industry consumes more than 43 percent from the total industrial feed compound manufactured in the country.
Besides the predicted increase in local consumption, pork meat exports are expected to increase steadily in the coming years, which will reinforce Romania’s position as one of Europe’s top agriculture and livestock producing countries and, indeed, as an increasing market for U.S. Soy.
Grain and oilseed/protein traders and purchasing officers from compound feed industry from Eastern Europe gathered in Warsaw, Poland in May for USSEC’s International Trade Risk Management Workshop. While most of the audience represented Poland, there were also customers from the Czech Republic, Hungary, Romania, Bulgaria, and Serbia.
Jay O’Neil, International Grain Program, Kansas State University, laid the foundation for the training event by presenting about U.S. grain and soy production and the marketing system. Then he explained the relationship between cash markets and futures, trading terminology and definitions, and how to read the futures prices and determine carry versus inverse markets.
Bob Bresnahan, Trilateral Inc., Chicago, introduced the audience to the Chicago Board of Trade (CBOT) as a clearing house and counter party risk to later move to fundamental analysis and technical analysis. He next focused on where and how to hedge and principals of futures and options trading.
On the second day of the workshop, the customers were given some examples of hedging for traders and producers and end users that allowed them to better understand how to apply what they were learning. Different trading strategies for different market conditions were also explained to them.
Jerzy W. Kosieradzki, USSEC Technical Director – Northeastern Europe, made the audience aware of the importance of sustainable food production to consumers in Western hemisphere and pointed out that U.S. Soy’s production system sets global standard in this respect. He also spoke on the U.S. Soy Sustainability Assurance Protocol (SSAP) certificates that are available to U.S. soybean and soy products importers that do not carry any extra cost to them.
The risk management workshop finished with a round of questions and answers and comments and the students were presented with their certificates of completion.
Eszter Magyari of Cargill-Hungary in Budapest shared that once she had attended a training course on managing risk in international trade organized for Cargill staff, but the USSEC workshop gave her a much deeper and more practical insight into these professional issues. A thank you call from Marek Brzozowski, Bunge-Poland’s commercial manager, whose staff members came back from Warsaw truly thrilled with the quality of know-how they received at the USSEC workshop, was a special reward.
Poultry expert, USSEC consultant, and University of Arkansas professor Dr. Craig Coon visited Russia May 21-24. Poultry products are very important for Russian customers, as poultry meat occupies a 47 percent share in the structure of meat production in Russia. In 2016, Russia produced more than 4.6 million tons of poultry meat in slaughtered weight (fourth in the world) and more than 44 billion eggs (fifth worldwide).
On May 22, Dr. Coon, accompanied by Maria Domoroshchenkova, USSEC local consultant, and Rachel Vanderberg and Maria Vecherkovskaya, Foreign Agricultural Service (FAS) – Moscow ag specialists, visited the innovative laboratory complex of Cherkizovo Group, the largest producer of meat products in Russia. Cherkizovo Group’s infrastructure includes 8 full cycle poultry production complexes, 15 modern pork production complexes, 6 meat processing plants, 9 feed mills, and grain storage facilities.
Cherkizovo Group’s research center, which is close to Moscow, was started in 2016 with an investment of 350 million roubles (around 70 million USD). It is an innovative laboratory complex equipped with the most modern equipment from American, European, and Japanese manufacturers, which makes it possible to test any of the products produced at the Cherkizovo facilities. The research center also features a highly qualified staff with an average age of 30 looking for new knowledge and technical training.
Dr. Coon shared his expertise in broiler breeding by providing an onsite technical seminar for the employees of the center. His presentations were followed by a lively discussion and an invitation for new visits. These offered the opportunity to further explain the advantages of U.S. Soy or soy in general in poultry rations.
USSEC was a bronze sponsor of the Meat & Poultry / Fish & Seafood Summit, which took place in Moscow on May 23-25, along with International Trade Show VIV Russia, a specialized exhibition for animal husbandry and processing in Russia and the Commonwealth of Independent States (CIS) countries. VIV Russia showcases the industry’s developments by the Feed to Food concept that brings together supply and demand within the complete animal protein chain.
More than two thousand visitors registered for the summit, which included several technical conferences. Dr. Coon’s presentation at the conference “Poultry Farm 2.0/17” was met with a high level of interest. Attendees were predominantly representatives from Russia’s feed and poultry.
The visit was used to network and get a better understanding of the Russian markets. Currently, Russia could be regarded as one of the most challenging markets. Recent developments have shown that the growth of the local feed and livestock industries are becoming reality. The growth trend seems to continue for the coming years and switching from imports of meat protein to vegetable protein provides opportunities for U.S. Soy exports.
USSEC Regional Director – EU / Middle East North Africa (MENA) Brent Babb gave a presentation on sustainable U.S. Soy production to an audience of more than 200 in Budapest, Hungary. The Hungarian Research Institute (AKI) of Agricultural Economics and the Food and Agriculture Association (FAO) regional office hosted the event, which focused on the feed and livestock chain.
The seminar highlighted the opportunity to increase awareness of sustainable agriculture in Hungary and utilized a multinational panel of speakers to emphasize the prospects and concerns of increasing global agriculture. Mr. Babb described U.S. soybean farmers’ efforts to increase conservation, while at the same time increasing productivity of the land. Discussions included the U.S. Soy Sustainability Assurance Protocol (SSAP), success in key environmental indicators, and the role of innovation such as biotechnology in sustainable crop production.
During the second week of April, USSEC met with integrated companies and feed mills from Romania to listen to and understand their challenges and offer technical assistance to customers of U.S. Soy. USSEC consultants Dr. Craig Coon, professor of poultry nutrition at the University of Arkansas, and Dr. Jan van Eys, animal utilization consultant from France, traveled to Romania to visit with large and rapidly expanding companies; all were top companies in their respective fields in southern Romania. Meeting with managers, quality control managers, nutritionists, and veterinarians was instructive and enhanced the access of U.S. Soy to these customers.
Together with the specialists at the companies visited, the USSEC experts reviewed the businesses’ quality control programs and laboratory methods. At this stage, the feed mill laboratories are pre-formatted and are under excellent management, thanks to the investments and high level of investment in the education of young professionals.
High levels of certain mycotoxins have been detected over the past year in the imported South American soybean meal in Romania and continue to be a problem for feed and livestock producers. Dr. Coon emphasized seasonal advantage (September to March), good infrastructure, and logistics as key advantages of U.S. Soy during discussions with the technical personnel of the companies visited.
Dr. van Eys, the author of the USSEC Soy Quality Manual, pointed out that careful attention should be paid to KOH protein solubility index since feed manufacturers around the world often found this quality parameter below the recommended levels and needing to be constantly investigated. Similarly, soybean meal carbohydrate levels are highly variable and have to be constantly analyzed compared with reference values.
The meetings with feed mill managers, quality control managers, nutritionists, and veterinarians were informative and allowed USSEC to gain a better understanding of the reality of the Romanian poultry and feed industries and its potential for progress and expansion. It clearly showed the opportunities and potential that exist in the Romanian market for growth in poultry production, and, consequently for the use of U.S. Soy products.
Specifically, USSEC should assist or continue provide local feed producers and integrations with information and support to enhance the understanding and importance of quality measures and formulation advantages/techniques to increase the performance of feeds and animals and, through this, show the potential of U.S. Soy.
USSEC’s 3rd Annual Advanced Training Program for Veterinarians from the Middle East and North Africa (MENA) was held at the University of Florida, College of Veterinary Medicine, in Gainesville, Florida from May 15- 19. 22 industry-leading veterinarians from the poultry industries of Egypt, Morocco, Tunisia, and Turkey participated in this educational program.
Presentations focused on practical application involving vaccination, disease control, and management in commercial poultry. This forum stimulated considerable discussions among the veterinarians from the different countries and provided ample opportunity for the exchange of ideas.
USSEC again has played a leading role in providing technical support for the MENA region’s commercial poultry industry.
On May 11, USSEC sponsored the annual networking event for the Dutch feed industry. Co-organized by the Royal Dutch Grain and Feed Trade Association (Het Comite) and the Dutch Feed Industry Association (NEVEDI), the event took place in a former feed mill complex, innovatively renovated as an event space, on the outskirts of Utrecht, Netherlands. As in the past, the organizers chose a broad theme for presentations and discussion. USSEC has participated in prior year’s sessions on sustainability and protein sources of the future. This year’s theme was Consumer Demand.
The first speaker of the morning session set the tone and provided an outline of how “incidences” lead to trends, which lead to patterns. A Dutch psychologist provided an analysis on consumer behavior in the supermarket, dispelling the five myths of consumer behavior, noting that while price is important, sustainability is of increasing importance to at least two of the market segments. She noted the importance of the social environment and that providing more information and facts alone will not change consumer preferences. A motivating story is better than facts.
The afternoon session began with a presentation by a representative of the Dutch Society for the Protection of Animals who described a new market initiative to label meat on the retail level with “stars” based on their animal welfare standards. Science-based with input from all stakeholders, from producers to retailers, the program appears to be successful and is expanding with one of the major bulk/discount retailers in the Netherlands.
Brent Babb, USSEC Regional Director – Europe (EU) / Middle East –North Africa (MENA) provided a presentation on sustainable soybean production in the United States and the U.S. Soybean Sustainability Assurance Protocol (SSAP). He noted that NEVEDI was the first European organization to recognize the scheme and their critical assistance in having the scheme later recognized by FEFAC, the European-wide feed industry association. Mr. Babb also highlighted USSEC engagement with the Field to Market program and how this project engages a broad representation of interests, focused on continuous improvement and output metrics.
The final speaker of the day was an academic researcher who summarized her work on the lifecycle analysis of meat consumption, including “consequential analysis” of secondary impact. Among her conclusions is that switching from imported soybean meal to domestically produced rapeseed meal in animal feed would have a significant environmental impact, particularly in terms of greenhouse gases and energy use. She also defended a limited role for animal protein in meeting the global nutritional needs of the future.
At the end, all the speakers joined the directors of NEVEDI and Het Comite on the stage and participated in a discussion on various statements, with active voting and participation of the audience.
USSEC’s support for this event is critical and appreciated by the organizers. It provides a speaking platform for USSEC, enables networking and building contacts and critical insights into the current conditions and dynamics of the Dutch feed and livestock production industries. All involved look forward to next year’s event.
For the past year, promoting sustainable agricultural supply chains has been an important subject, both in EU countries and globally. Recently, sustainably produced feed, poultry, and livestock products have been a hot topic for Romanian and Polish poultry companies as well.
The poultry meat products in southeastern and central European countries are high quality due to excellent growing and modern slaughtering conditions but are sometimes unable to reach western markets because of export requirements often based on different certifications systems in different countries or increasing supermarket pressure and less because of consumer demand.
The sustainability of the poultry meat production system can be influenced by several factors, including the origination of ingredients, chemical composition, and nutrient digestibility of a diet, among others. Because the poultry industry is largely dependent on soy as its main protein source, this ingredient is tightly interlinked with sustainability today.
In an effort to show commitment to the Romanian and Polish poultry industries and build a preference for U.S. Soy, USSEC held a one day seminar on “Sustainable Soy, Poultry Production, and Marketing” in Bucharest, Romania with the goal to educate poultry nutritionists, veterinarians, management and marketing experts on U.S Sustainable Soy and poultry production.
In his speech, Dr. Jan van Eys introduced the current market situation for feed and soy, followed by USSEC’s sustainability program and a discussion on quality differences among origins in anti-nutritional factors. These aspects were a good introduction for the other speakers.
The key messages delivered by Mack Graves, management and marketing consultant stressed how modern consumers today prefer meat products produced with sustainable ingredients. Sustainability is a new marketing tool for the meat industries, which can be good for business as well as the environment. Companies must become transparent in all they do to and establish consumer trust and enhance meat consumption. More than 90 percent of the soybean meal consumed in Romania and Poland is imported, either directly as meal or as soybeans that are locally processed into soybean meal. Soybean meal and beans are some of the ingredients for which the Romanian Feed Manufactures Association specifically supports industry initiatives in order to make the supply chain more sustainable.
As the local market and export demand for poultry meat grows, so too does demand for poultry feed. In recent years, the demand for vegetable protein meals for use in poultry feed has increased in Romania, and this trend is likely to continue over the coming decade. The increasing consumption of vegetal protein in feed, combined with increasing meat consumption and sophistication of the customer should raise important questions about how the supply of soybean meal can keep pace with rising demand for poultry feed. Collaboration between U.S. farmers, suppliers, and integrated poultry meat producers is a crucial part for sustainable animal production. Romanian poultry meat producers recognize U.S. farmers and suppliers for their continuous improvement and their effort to address the big issues associated with soy production such as environment protection, soil preservation and water quality.
Dr. Craig Coon presented the latest findings in the field of broiler and broiler breeders’ nutritional research. Genetic progress of broilers’ growth performance traits has been exponential in the past decades. Selection for increased growth rate (feed intake) has led to their improved efficiency through their capacity to process increasing amounts of nutrients on a daily basis. Feed intake is regulated not only by dietary energy level but also by the concentration of amino acids in the diet (balanced protein).
Rene Schepens from Fermentation Experts Denmark emphasized that fermented plant protein can replace fishmeal while fermentation of vegetal protein increases the efficiency of use of phosphorous (100 percent) and nitrogen (15 percent), avoids environmental pollution and increases profits. Indigestible and anti-nutritional components in the raw materials are converted into health promoters during fermentation, if it is done in the correct manner.
There is an enormous worldwide additional need for protein (meat/eggs) in the future, and meanwhile, there is a limited availability and acceptance of animal protein in feed. Current animal farming practices emphasize on more natural rearing, fewer medicines/antibiotics and a continuing pressure to be efficient with inputs and output (N, P) are other two main trends in the Western feed and livestock business.
With the dependence of the Romanian and Polish poultry and feed industries on imported high quality protein ingredients such as fishmeal of soy protein concentrate (SPC) and/or soy protein isolate (SPI) for their specialty diets in broiler pre-starters and young animals, the development of substitutes such as fermented soybean meal is of major interest, both practical as well as economical.
By the end of the seminar, poultry professionals understood how to address the industry and marketing challenges and how the sustainability of meat production can be influenced through certification, manufacturing processes and policy change. A coordinated effort across the industry that includes ingredient purchasers, nutritionists and veterinarians and marketing managers may result in a more sustainable poultry industry in Romania.
After several years of sustained growth, the Romanian poultry industry has reached a stage where the management and marketing needs to be fine-tuned. USSEC has understood and answered the need of the poultry customers, organizing an exploratory visit from April 8-11 to understand the achievements and challenges of the poultry meat producers in Romania.
Mack Graves, a consultant specializing in corporate strategy, management focus, and marketing effectiveness in companies and organizations across the protein chain from beef to poultry, was invited together with USSEC animal consultant Dr. Jan van Eys, to visit with leading integrators in broiler and turkey meat production located in southern and central Romania. Bona Avis and Penes Curcanul are both important players and trendsetters within the Romanian market and commodity usage, and are consequently potential to increased soy usage.
Several years ago, Mr. Graves consulted with poultry integrated companies in Romania on behalf of U.S. Soy farmers.
“I was pleasantly surprised to see during my visit to Romania the evolution of the consumer towards quality and convenience poultry meat products,” said Mr. Graves. “The poultry meat products today are high quality thanks to the investments in high quality farming technologies and modern poultry processing plants. From what we understood, the Romanian poultry meat is not always reaching the export markets because of different quality certifications systems from different markets. Entering new markets and reaching the increasing demand for quality of the consumer are part of the sustainable marketing strategy.”
Today’s modern consumers prefer meat products produced with sustainable ingredients. Sustainability is a new marketing tool for the meat industries, which is good for business as well as the environment.
“Companies must become transparent in all they do to establish consumer trust and enhance meat consumption,” Mr. Graves concluded.
After his visit to Romania, Dr. van Eys reported, “Continuous promotional efforts to accompany the growth of this market and positioning of U.S. products in this market are recommended. Clearly, great progress has been made in the feed industry but some key opportunities for improvements remain. Those opportunities can be addressed by USSEC and, in the process, U.S. Soy will be promoted and profiled for its quality characteristics. The Romanian industry and market stands to grow significantly over the next several years, so an enhanced position of USSEC and U.S. Soy should translate in increased sales and opportunities.”
During the third week of April, the Bulgarian Feed Manufacturers Association (BFMA) held their annual conference in Velingrad City. This was the 27th year of the industry’s annual meetings, with a record participation of over 120 guests from Bulgaria and neighboring countries: Turkey, Romania and Hungary.
They were part of an excellent conference program, with high level technical presentations of speakers of international companies from Germany, Hungary, Czech, Denmark, Turkey and the U.S.
USSEC’s team of consultants, Dr. Jan Van Eys and Dr. Iani Chihaia, attended BFMA’s event on behalf of USSEC, with the goal to increase awareness of U.S. Soy’s sustainability and followed up with the recent Bunge import of U.S. soybean meal to Constantza Port. Alex Doring, the general secretary of FEFAC, was invited to join the USSEC team.
Following the opening of the event, Mr. Doring presented “FEFAC Vision 2030 on Sustainable Feed and Livestock Production –Working Priorities for 2017,” followed by Dr. Jan van Eys, who gave the paper “Sustainability Of U.S. Soy Production and Nutritional Considerations of Second Generation Soy Products.” The topics presented by the USSEC team triggered a lively question and answer session focused on the sustainability of soy and soy products versus other vegetal protein sources.
By the end of the conference, the main ag TV channel in Bulgaria, Agro TV interviewed the USSEC delegation.
BFMA’s conference provided plenty of opportunities this year to meet with the Bulgarian feed representative as well as with representatives of the feed industry of surrounding countries. The attendees of this annual meeting represented all aspects of livestock (feed) production. This allowed for a broad but thorough and lasting representation of USSEC and its objectives.
Near future development of the industrial animal production in Bulgaria will enhance demand for imported ingredients of superior quality and quality feed. As such, USSEC’s continued involvement and support will likely pay off in greater export potential mid-term.
In an effort to increase awareness of U.S. Soy and pave the way for future U.S. Soy imports and the sustainable feed industry, a USSEC delegation visiting Bulgaria during the month of April benefited from the unparalleled support of the Foreign Agricultural Service (FAS) in Sofia and organized a meeting with the Bulgarian Food Safety Agency (BFSA), an integrated government body that combines feed and food regulations and animal health under the Ministry of Agriculture.
Established in early 2011, BFSA follows the best European practices for the implementation of highest standards of controls in the areas of safety and quality of food, food and feed additives, veterinary medicine and animal welfare, and feed safety.
The USSEC – FAS – European Feed Industry Federation (FEFAC) delegation was received at BFSA by Dr. Petya Petkova Ivanova, deputy executive director; Dr. Penka Maneva Kaneva, head of the feed control department; and Dr. Georgi Chobanov, director of the animal health division. The delegation had the opportunity to discuss and learn the latest details of EU regulations and discussed how these affect Bulgaria. Major progress has been made towards application and the contribution of the relatively young Bulgarian agency was discussed.
The presence of FEFAC’s Alexander Döring during the visit to BFSA opened additional, significant opportunities in terms of future meetings with government and feed industry representatives, as well as synergistic action in the Bulgarian and larger EU region. Closer cooperation between FEFAC and BFSA’s involvement in future general meetings was also discussed.
Feedback from BFSA representatives was extremely positive, laying the basis for future contacts and collaboration. The interest and potential of U.S. Soy was clearly put forward and was well accepted. Due to the established relationships, USSEC should be able to benefit from this cooperation and position itself for enhanced, positive enforcement of its message and ultimate goal: increasing demand for U.S. Soy.