South America Animal Feed Market - Forecasts from 2023 to 2028

The South American animal feed market is expected to grow at a CAGR of 2.70%, from an estimated value of US$32,185.975 million in 2021 to US$38,774.486 million in 2028.

The South American animal feed market is a dynamic and expanding industry that is vital in supporting the region's livestock sector. The region's rich biodiversity and abundant natural resources make it an ideal location for producing high-quality animal feed products. The South American animal feed industry is characterized by intense competition, with local and international players vying for a larger market share. This competitive landscape has led to continuous improvements in product quality and the adoption of innovative technologies that enhance animal health and productivity. The main objective of the animal feed industry is to provide nutritious and cost-effective feed products that meet the increasing demand for animal protein. As the population of South America continues to grow, the demand for animal protein also increases. This trend is further fueled by rising income levels, which have led to increased consumption of meat and dairy products.

Increased demand for meat and other end-products is driving North American animal feed market growth.

The demand for beef has been a significant driver for the animal feed market in South America. The region is home to some of the world's largest beef producers, with Brazil, Argentina, and Uruguay being the top three beef exporters globally. In recent years, beef consumption in South America has been increasing steadily, driven by population growth, rising incomes, and changing dietary habits. This increased demand for beef has led to a surge in livestock production, which, in turn, has driven up the need for animal feed. Livestock requires a nutritious and balanced diet to ensure their health and productivity; animal feed is a crucial component. The use of animal feed in South America has grown significantly in recent years, with Brazil and Argentina being among the region's largest producers of animal feed.

According to a USDA Foreign Agricultural Service report, the Argentine beef consumption forecast for 2022 was 2.398 million tons cwe, a level similar to the preceding two years. Although Argentina maintains its position as a world leader in per capita beef consumption, per capita consumption is expected to decrease to 52 kilos in 2022 due to population growth and a shift toward less expensive meats. Since 2019, domestic beef consumption has declined due to increased beef exports, decreased purchasing power, high unemployment, and changes in dietary patterns such as vegetarianism and veganism. Strong demand and higher global beef prices are projected to boost exports, which are expected to average 720,000 tons cwe per year from 2019 to 2022. Domestic beef prices have increased compared to alternative meats, with beef being 50% more costly than pork and 250% more costly than broiler meat. The surge in beef prices, which have doubled since 2007, is largely due to difficulties in the beef sector and progress made by other supply chains, such as poultry and pork.

The growth of the animal feed market in South America has also attracted significant investment from foreign companies.

The region's position as a leading beef and animal feed producer has made it an attractive destination for investors looking to tap into the growing demand for these products. The Innovative Finance for the Amazon, Cerrado, and Chaco (IFACC) pledge planned to invest $1 billion in sustainable soybean and cattle farming in threatened South American ecosystems without deforestation by 2025. The initiative offers attractive financing options to farmers who pledge not to engage in the felling of trees or conversion of forested land. The total commitments under IFACC have increased to $4.3 billion, with 15 companies joining the initiative. The coordinators of this initiative remain optimistic about achieving their $1 billion goal by 2025.

By country, Brazil is expected to hold a significant share of the South American animal feed market during the forecast period.

Brazil has a thriving livestock industry, with significant beef, poultry, pork, and dairy production. The expansion of the livestock sector directly drives the demand for animal feed. According to the Brazilian Institute of Geography and Statistics (IBGE), the livestock sector accounted for 6.2% of Brazil's Gross Domestic Product (GDP) in 2020. Also, Brazil has a large and growing population, rising disposable incomes, and changing dietary patterns. This has increased demand for animal protein, including meat, milk, and eggs. The demand for animal protein drives the need for high-quality animal feed to support the growth and productivity of livestock.

Further, the Brazilian government has implemented various initiatives and policies to support the agriculture and livestock sectors, indirectly benefiting the animal feed market. These include financing programs, tax incentives, research grants, and regulatory frameworks that promote animal health, feed safety, and sustainable farming practices. For instance, the AgroNordeste Program, launched by the Brazilian Ministry of Agriculture, Livestock, and Supply, aims to foster the development of agriculture and livestock production in the Northeast region of Brazil.

Market Segmentation:

By Type

• Fodder & Forage
• Compound Feed

By Livestock

• Swine
• Aquatic Animals
• Cattle
• Poultry
• Others

By Raw Materials

• Soya
• Corn
• Rendered Meal
• Others

By Production Systems

• Integrated
• Commercial mills

By Country

• Brazil
• Argentina
• Colombia
• Chile
• Peru
• Others