Top Ten’s Market Share Is 55 % -- Medium-sized Pig Specialists Are Developing Well – Northwest Germany Grows, Central Germany Stagnates, and the South Reports Losses – Top-ten Enterprises Located in Northwest Germany

Pig keeping is and will remain by far the most important sales market for the German compound feed producers. This is the conclusion of the latest evaluation undertaken by the ISN Interessengemeinschaft der Schweinehalter Deutschlands e. V..

In 2006, the ISN had first studied the structures prevailing in German pig feed production. Ever since, compound feed production has increased by 9.6 % throughout Germany, adding up to 8.92 million tons. According to information issued by the BMELV (Federal Ministry of Food, Agriculture and Consumer Protection), the number of production companies went down at the same time by 8.6 % (back to 330 companies).

The upgrading companies are looking back on two years of high prices to be paid for raw materials. Many farmers benefited from the phase of high prices, selling the crop they harvested instead of mixing feed themselves. For this purpose, the fattening places were expanded vigorously in number all over Northwest Germany. The structural changes observed with regard to the pig-keeping farms, also have effect on the use of compound feed: At the major farms, producing their own food often ties up too much capital and manpower, thus making complete feed purchase much better fit in to the company organisation.

How could the compound feed producers use this trend for themselves?

Over the past three years, the top-ten feed producers increased their total tonnage by 12.5 % to producing 11.5 million tons of compound feed. This way, they succeeded in achieving a 55 % market share for themselves. Looking at the Top 25, you find that they even reached a market share of 70 %. Compared with other agribusiness industries (such as agricultural chemistry, slaughtering), the degree of concentration proves to be comparably low. So, intense competition is still observed in the compound feed sector. This kind of competition represents one of the locational factors so favouring the northwest of Germany.

Based on company information, the analysis made by the feedstuffs industry shows that in 2009 more than a million tons of compound feed (for all kinds of animal species) were produced by the Top Five companies each. Among them are Deutsche Tiernahrung Cremer, Düsseldorf (2.3 million tons), Agravis Raiffeisen AG, Münster (2.17 million tons), Bröring group of companies, Dinklage (1.3 million tons), Mega Rechterfeld (1.1 million tons) and For Farmers Group, Lochem / NL (1.04 million tons.)

In the following, you find a detailed analysis of the developments in the field of compound pig feed.

Since 2006, the production of pig feed has increased by 784 000 tons, having gone up to 8.9 million tons. The ten biggest companies alone were able to expand their total production by as much as 444 000 tons.

Agravis and Deutsche Tiernahrung Cremer were able to maintain their year-2006 top positions in ranking at moderate growth. The Bröring group of companies is approaching the first and second places. Bröring were able to increase their production of compound pig feed by 25 % (up to 650 000 tons) over the past three years.

The Dansk Landbrugs Grovvarelskab (DGL) increased their share of the fourth-placed Raiffeisen Agricultural Association Nord AG (HaGe) at Kiel from 70 to 100 %. Having sold an additional 15 000 tons of pig feed, the HaGe Kiel also grew slightly. They are still on course for growth and call attention to themselves by performing takeovers (e. g., Roth Landhandel).

The Bela mills, ranking fifth and having been taken over by the Dutch For Farmers group, were able to increase pig feed production by 4 %. Bela are running production facilities at Langförden (near Vechta), Hamburg and Rees / Lower Rhine. Moreover, the Dutch company is active on the German market from its headquarters at Lochem / NL.

Above-average growth is reported for GS Agri / Schneiderkrug and for the Fleming & Wendeln Group / Garrel, ranking 6^th and 7^th on the list. GS Agri from the Oldenburger Münsterland (Northern Germany), including LBG Garrel and Landwehr, could increase their pig feed sales by nearly 46 % (up to 350 000 tons). The situation is similar for the Fleming & Wendeln group (including Leikra), whose production could be expanded by 45 % (up to 315 000 tons).

Quite a few companies are found ranking 11^th to 21^st which can be named pig-feed specialists as well. To mention a few: RWG Grafschaft Hoya (68 % share of pig feed), Strahmann GmbH & Co. KG (85 %), RWG Ankum (83 %), Kohnen / Sögel (including Eirero, 85 %) and Diekgerdes Landhandel (90 %). These five companies achieved a 152 000 tons’ increase over the past three years.

It remains to note that those companies which are based at the northwest German region were able to well expand their pig feed sales. The northwest German pig keepers’ investment activities, related to the building of new fattening houses, supports the good development of the compound feed industry established there. Comparing their growth rates with those of the Northern- and East German compound feed producers, one finds that growth there has been just moderate or even stagnating. Feed producers in Southern Germany even had to cope with quantitative losses during the last years. RKW Süd, for instance, lost their position on the Top-Ten list.

For 2010, the Deutsche Verband Tiernahrung (DVT; German pet food association) expects consolidation at a high level as to compound pig feed production. Further expansion of fattening farms and the industry’s orientation towards exports are intended to support the developing.