Cattle Feed: Analysing Market Health and understanding the Opportunities

The markets around cattle feed and fodder have witnessed a steady growth over the years. And with the biotechnological sector kicking in, a host of contributing factors have proliferated in their own right. 

For instance, the development of additives, nutrient content of the cattle feed, efficient digestibility, and enhanced animal health are some of the market aspects that are getting a lot of attention. In fact, the rising demand for milk, for instance, is increasing concerns about the health of the cattle — thus, indirectly serving to the growth of the global cattle feed market.

Not to forget that the need for more sophisticated analytics and technology-driven products is increasing, too. With all these influences working together, it is estimated that the cattle feed industry will continue to expand in the years to come. Certainly, a lot of opportunities are waiting to be explored.

Market Overview

Holistically speaking, the animal farming sector is responsible for the annual growth of 40% in the global agricultural production value as per the Food and Agricultural Organization (FAO). This has a direct influence on the expansion of the cattle feed market. As it stands, the cattle feed market is evolving at a CAGR of 3.1% and would keep treading the same path, albeit steadily, until 2025.

But it is not just being regulated by a solitary source and has a variety of other sectors with influences:

• The rise in dairy products is advocating for the cattle feed market. Not to forget that livestock, too, has stood up as the major income source for almost 23% of the households working in the field of agriculture even to this day.
• Bovine milk use is on the rise. As per recent reports, this industry has witnessed an increase of 6.65%, with almost 176.4 million tons of milk being produced.
• Increased bovine protein demand is being observed given that lifestyle change is promoting consumption of increased meat and protein.

Looking at the current cattle feed market (valued at 942.4 billion in 2020), the vitality of the cattle feed industry in the global market and dominant market players, the sector can certainly be assumed to be a very lucrative option for investors.

Indian Market Status

• Market size: $942.4 billion in 2020.
• Forecasted market size: $460.322 billion by 2026
• CAGR: 12.5% between 2020 and 2026.

As elucidated above, dairy, bovine protein, livestock are not just the major driver but also the market players in the cattle feed industry. Moreover, the tough to differentiate segments of beef, dairy and other animals are driving the cattle feed market. Major concerns, however, are supply-demand disintegration in milk production, adverse weather conditions and the rising global population for livestock. But these all open avenues for investment opportunities and valuate the industry in a promising light.

Nevertheless, the key preference to invest in the cattle feed market lies in analysing the particular product segments and their current and expected growths along with the recent trends that affect their demand.

Market Segmentation Forecast

Growth of the Additive Market

The additive market is being driven by a multitude of factors. Their addition to the cattle feed is essential, and that is how it influences the cattle feed market.

• Vitamins: With a CAGR of 3.7% between 2021-2027, the market is presumed to attain a size of $28.6 billion by 2027.
• Antibiotics: With a CAGR of 8.1% between 2020-2025, the market is presumed to attain a size of $44.4 billion by 2025.

Ingredients Used to Make the Cattle Feed

Ingredients used to make the cattle feed play an important role in the global market, and their use will influence the production of cattle feed exponentially. Again, one must note that cattle feed production is not the sole reason for producing the raw materials used to make them.

• Grains: The grain market will grow at a rate of 6.4% between 2020-2025, and the biotechnological evolution will add impetus to it.
• Brans: The bran market is expected to grow by 4.5 % by 2025.

Growth of the End Products in the Market

The more the end product consumption will be, the more will be the supply and hence more the demand for cattle feed.

• Dairy product industry: Annual CAGR of 2.5% between 2020 and 2027.
• Meat industry: Annual CAGR of 6.24% between 2020 and 2027.

Conclusion

The cattle feed market is multi-dimensional, with varied and diverse segments. Its growth primarily depends on increasing demand for the products, which in turn will create new markets for both existing and future food processors. The industries will continue to search for new ways of increasing their profit margins while reducing the cost of production. With the potential market scope and opportunities, the cattle feed industry looks promising.

Factors such as – strict animal welfare norms, requirements of meat production coupled with the advancements in nutritional science – will add to the growth of this sector, not to mention the traction of the dairy industry.