The global phytogenic feed additives market size is estimated to be USD 753.1 million in 2020 and is projected to reach USD 1,098 million by 2025, at a CAGR of 7.8% during the forecast period. The market has a promising growth potential due to several factors, including the increasing awareness of plant-based animal feed products and strict government regulations regarding animal health.
The key players in this market include Cargill, Incorporated (US), Delacon Biotechnik GmbH (Austria), BIOMIN Holding GmbH (Austria), Bluestar Adisseo Co., Ltd. (China), DuPont (US), and Synthite Industries Ltd. (India). Manufacturers are adopting strategies such as new product launches, expansion & investments, mergers & acquisitions, agreements, collaborations, joint ventures, and partnerships to strengthen their position in the market.
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Cargill Incorporated (US) held the majority of the global phytogenic feed additives market share in 2020. As livestock feed manufacturers seek sustainable and natural solutions to enhance animal performance and reduce and replace antibiotic growth promoters (AGP) in feed, Cargill offers feed additives and functional feeds. Through its animal nutrition business unit, Cargill offers feed additives, including phytogenics for many animals, such as swine, poultry, ruminants, and aquaculture.
The company’s strong global reach helps it to source ingredients and produce high-quality animal feed and feed additives at the best cost. Furthermore, in 2017, Cargill and Delacon formed a partnership to provide their customers with efficient feed phytogenic products. Being one of the leaders in animal nutrition, the company has a large consumer base for feed phytogenic products and is hence one of the global market leaders.
Delacon Biotechnik GmbH (Delacon) is one of the leading players in the feed phytogenics market. It develops and produces natural feed additives prepared from spices, herbs, and essential oils for poultry, ruminants, and swine. The company exports its products to more than 80 countries and has one production site. The major products of Delacon include BIOSTRONG 510, FRESTA, RUMEX, and ACTIFOR. FRESTA F and Biostrong 510 EC are the first and second phytogenic feed additives, respectively, to obtain an approval from the European Union (EU) for use as growth promoters (zootechnical additive) in Europe.
Bluestar Adisseo Co., Ltd. (Bluestar Adisseo) is one of the leading providers of animal nutrition solutions. It operates as a subsidiary of the Chinese Bluestar Group. The company provides feed additives to 3,500 customers located in 100 countries globally. Adisseo has nine in-house research centers and several external research contributors; it also has seven production sites based in France, Spain, and China. In February 2018, Bluestar Adisseo (France) acquired Nutriad, Inc. to strengthen its global product portfolio’s competitiveness. The company provides feed phytogenic products through its recently acquired subsidiary, Nutriad Inc. (Belgium). Nutriad is an important specialist in the development, manufacture, and marketing of animal and aquafeed additives worldwide. The company delivers products & services to over 80 countries worldwide through a network of own offices and distributors, supported by four application laboratories and five manufacturing facilities in the UK, Belgium, Spain, China, and the US.
Market Dynamics
Driver: Encapsulated technology enhances the proficiency of phytogenic feed additves
Phytogenic feed additives have positive effects on livestock health but are often difficult to process in the feed. Many sources of phytogenics, especially essential oils, are sensitive substances that lose their efficacy and efficiency, owing to their vulnerability to high temperatures, dusty inclination, significant odor, and oxidative and volatile properties. The emergence of new technologies, such as encapsulation, helps to extend the shelf life of phytogenics. Encapsulation is a modern technology that allows essential oils to have a longer shelf life by protecting them from environmental changes by keeping the liquid, gaseous, or solid substance packed within a tiny millimetric capsule. Along with protection from extreme environmental factors, encapsulation also maintains the key properties, such as enhancement of palatability, stability in the ration, improved digestion, and better performance of the livestock.
Restraint: Cost of active ingredients used in phytogenic feed additives
Essential extracts from various spices and herbs are the most important raw materials used in the production of feed phytogenics. However, the prices of essential oils are high, which has hindered the growth of feed phytogenics. As per the International Trade Center (ITC), in Madagascar, the export price of clove leaf oil was USD 17/kg in 2016. Although the prices were down from the previous year, they were still well above the long-term trend price of under USD 10/kg. Moreover, current adverse weather conditions and a rise in demand for the spice may drive the prices higher.
Opportunity: Increased popularity of natural solutions for pet food nutrition
Owners of pets remain very sensitive and concerned about the quality, safety, and source of the ingredients involved in the manufacturing of their pet’s food. The trend of keeping pets is also gaining pace these days. Additives play a very important role in enhancing the quality of the feed for pets. Keeping in mind the concerns of pet owners, many companies are coming up with innovative feed products made up of naturally sourced ingredients, such as plants and microbes. Many companies, such as Silvateam S.p.A. (Italy), offer phytogenic feed additives for pet food. Thus, the increase in the pet population, along with concerns of pet owners for pet health and nutrition, would persuade many feed additive players to launch phytogenic feed additives in the pet food segment.
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Challenge: Counterfeit products in developing economies
Lack of transparency in patent protection laws and regulatory compliance in various countries has led to the duplication of products. Low-quality products are also introduced in the market by regional or local manufacturers to reap the benefits of the growing demand for phytogenic feed additives. Duplicate and low-quality products can create health issues in the livestock and are a big concern for the producers. There are many small players in the developing markets of Asia Pacific that offer phytogenic feed additives without any brand name, and somehow increase their profits by selling unauthorized duplicate products. These local manufacturers attract feed producers as well by offering lower prices for their low-quality phytogenic feed additives.
