World Grain - June 2014 - (Page 86)

FEATURE: GLOBAL GRAIN OUTLOOK Growth in livestock sector translates into more feed, protein demand With incomes growing around the world, the livestock sector is experiencing a dynamic time, said Randy Blach, chief executive officer of CattleFax, during the Global Grain North America Conference in Chicago, Illinois, U.S., in May. Blach provided an overview of the trends and developments in the livestock industries and what that means for feed and protein demand. He noted that as incomes grow, there is a correlation with people wanting a higher quality meat protein in their diets. "When we're talking about beef, pork or poultry, all those items tend to benefit when we see rising incomes," Blach said. When ethanol production started taking a large chunk of the corn market in the early to late 2000s, livestock producers couldn't stay profitable. Cost gains went up so rapidly that livestock produc- tion didn't grow and remained flat for the last seven to eight years, he said. But now that the corn market has answered the new demand brought by ethanol, the protein output in the U.S. is going to grow fairly significantly over the next four to five years, assuming there are no hiccups relative to the crop, Blach said. He noted that the markets are very connected, and one can't change without having an impact on the other. If corn prices can stay in the $3.50 to $6 range per bushel, there will be a higher percentage of total corn and soybean production from the U.S. exported as protein. "We're already exporting 40 pounds per capita, and that will be over 50 pounds by 2020," Blach said. "There's an opportunity for everybody in that." Overall, about 51% of the 2013-14 PROVEN SOLUTIONS. Towers, Catwalks, & Support Structures Visit to find your local GSI dealer today. STORAGE | CONDITIONING | MATERIAL HANDLING | TOWERS & CATWALKS GSI® is a worldwide brand of AGCO. corn crop will go toward feed usage, assuming all ethanol co-products come back into the market to replace corn. Along with the impact of ethanol, drought has hurt livestock profitability and therefore total animal numbers. Since 2000, beef cow numbers are down 19% or 9 million head. The numbers have been declining for quite some time, Blach said, but part of that is also efficiencies. The same amount of meat that used to require five calves now only takes four. "Don't get hung up so much on the numbers," he said. "Total cattle inventory is the smallest since 1952, but the beef production is 2.6 times larger. We don't need to see cattle grow 10 million head, we just need to see 2 to 3 million head." He expects to see growth in beef cattle by 2016. Dairy cows have already experienced growth, with an addition of 1 million head since 2000. "We are feeding more dairy animals than we have in any time in the history of our industry," Blach said. "About 20% of the feed supply will go to dairy animals. This has been change that is happening around the globe. " Pork production was expected to grow 2% this year, but with the PEDv virus killing young pigs, that has changed to a 4% drop, he said. Pork prices are at record highs. Broiler production was the first to benefit from lower corn prices, and output is expected to be up 2% to 3% this year. "There is potential for poultry output to grow even faster," Blach said. to buy things such as fertilizer and other chemicals. That's why it's critical the weather continue to be favorable, he said. He noted that 70% of the nation's wheat export market comes from the western region, which could be a problem if Russian President Vladimir Putin sets his sights on the area. Portier said wheat production in Ukraine is expected to be down 3 to 4 million tonnes from the 22 mil- For more information, see Page 122. 86 June 2014 / World Grain /

Table of Contents for the Digital Edition of World Grain - June 2014

World Grain - June 2014
Table of Contents
From the Editor-in-chief - Urbanization sways future of food
Calendar of Events
Australian Grains Industry Conference
News Review - Wilmar, First Pacific to acquire Goodman Fielder
With CFP acquisition, Milner renamed Grain Craft
Smaller harvest drops GrainCorp profit 43%
CBH adds to executive team
Cargill completes Vietnamese feed plant expansion
Tiger Brands to mothball several Nigerian flour mills
ADM’s first-quarter earnings hurt by weather
ADM appoints oilseed vice-president
Alliance Grain results up in first quarter
Ingredion’s earnings drop on weather costs
African leaders urged to boost agriculture
Richardson increases canola capacity
Former president of James Richardson & Sons dies
The Andersons earnings up on ethanol, rail
Bunge reports loss in first quarter
Grain Market Review - Rice
Country Focus - Romania
Feature - Serving a Changing Market
Interflour’s growth strategy
The Flour Fortification Initiative
Feature - Canada in the spotlight
Next year’s event
Feature - A perfect storm
Feature - Grain Storage and Handling Projects
Feature - Opportunities and Challenges
Feature - Cereals Europe 2014
Feature - De Decco's path to success
Ownership structure
Feature - Global Grain outlook
Growth in livestock sector translates into more feed, protein demand
Rice Quarterly - Methods for stabilizing rice bran
Rice News Roundup - Group changes name to Food Fortication Initiative
India’s basmati exports to Iran slow
Thailand hopes for comeback in jasmine rice market
Gambia can produce 2 million tonnes of rice
Pakistan rice exports up 20.19%
Philippine farmers bring in post-typhoon harvest
Pakistan wants rice export re-examined
Feature - IAOM MEA celebrates 25 years
Grain Operations - Mycotoxin management
Technical Profile - Enhancing cozonac
Supplier News
Product Showcase
World Grain Archive
Ad Index/Reader Information Form International Faxback Program

World Grain - June 2014