VIDEO: Cargill’s outlook for growing phytogenics market

Find out why Cargill is expanding its phytogenic feed additive product portfolio through the acquisition of phytogenics leader Delacon.

Popularity of natural solutions and push for sustainability prompt company to expand its phytogenic feed additive portfolio

With antibiotic elimination, an emphasis on gut health and an overall societal push for natural products, phytogenic feed additives have gained a lot of interest from the animal health and nutrition stakeholders across all species.

Phytogenic feed additives are “substances of plant origin added to animal diets at recommended levels with the aim of improving animal performance,” including essential oils, herbs and spices, which serve as sources for bioactive ingredients.

The Global Phytogenic Feed Additives Market size was estimated at US$810.43 million in 2021 and expected to reach US$878.59 million in 2022, and is projected to grow at a CAGR 8.58% to reach US$1,328.61 million by 2027, Global Newswire reports.

Recently, Cargill announced its plans to acquire Delacon, a leading phytogenic feed additive manufacturer.

Cargill shares its outlook for the growing phytogenics market from WATT Global Media on Vimeo.

Transcription of Feed Strategy Chat with Mike Johnson, leader of animal health technologies, Cargill

Jackie Roembke, editor in chief, WATT Feed Brands/Feed Strategy: Hi, everyone. Welcome to Feed Strategy Chat. I’m your host, Jackie Roembke, editor in chief of WATT Feed Brands and Feed Strategy magazine.

This edition of Feed Strategy Chat is brought to you by WATT Global Media and is your source for the latest news and leading-edge analysis of the global animal feed industry.

Today, we’re joined on Zoom by Mike Johnson, leader of Cargill’s animal health technologies business. He’s here to talk about Cargill’s recent announcement of its intent to acquire Delacon, a pioneering phytogenic feed additives company.

Hi, Mike, how are you today?

Mike Johnson, leader of animal health technologies business, Cargill: Doing great, Jackie. Thanks.

Roembke: Excellent. Thanks for being here. Well, let’s get right into it. Please describe the potential for growth in the phytogenic feed additives market.

Johnson: Absolutely. We think there’s a tremendous potential for growth in the phytogenic feed market for sure. Definitely, consumers are demanding more sustainable solutions for animal agriculture. And we’re seeing this translate not only to consumers, but also consumer packaged goods (CPG) companies, etc., that are just really looking for this type of market-leading innovation. And we’re excited that, with this announcement, we expand our portfolio and can help bring these sorts of solutions to market.

Roembke: Very good. Are there particular regions that maybe have more potential than others or more demand?

Johnson: You know, I think that’s the beautiful thing about this space is it’s really all regions across the globe. As we look at this market, animal protein production continues to increase in demand — and these sorts of phytogenic feed additives — we think that this is going to be a growth story everywhere.

Roembke: How long has the Delacon acquisition been in the works?

Johnson: Really, the acquisition has been in the works for the last five years. As we structured a fantastic partnership with them five years ago, it really allowed us to get to work with them, get to know them, get to bring their portfolio to market. And then this is just the natural culmination of that five years of collaboration that really takes us to the next step, and gets rid of any barriers to us working together very collaboratively.

Roembke: What was the main motivation in making the move from a partnership to purchasing the company now?

Johnson: It’s really, I guess, about three things. You know, we think there’s a great go-to-market opportunity here with their market-leading capabilities across the world, in taking this sort of additive to market. We think, from an innovation perspective, this offers really good knowledge in the phytogenic universe, and how these various modes of action have different botanicals and how we can bring that portfolio to life.

And, you know, finally, we think, as I said before, that this is really where the market’s headed. And this is really what consumers are demanding. And so we think for our customers, this is going to be a great opportunity to have access to this sort of portfolio.

Roembke: And I know it’s a little early to tell or to tease, but what’s next for Delacon’s product portfolio?

Johnson: You know, realistically, we have a fantastic portfolio today. So I think pushing the portfolio we have out more broadly in the market is going to be really critical for our team. And we see tremendous opportunity in the aquaculture space. We’re currently working on the launch of a new product called Syrena Boost in aquaculture. And I’ve seen some really exciting results in shrimp and think that may have some broader applicability in aquaculture.

And then beyond that, as I said, with the phytogenic genius that Delacon brings to us, we really feel that there’s quite a bit of opportunity for new product innovation at the intersection of our market leading postbiotic portfolio with their phytogenics.

Roembke: Very good. Where does Cargill see the most opportunity for the additive category moving forward and why — hitting on some of those macro issues, both environmental and from an animal health perspective?

Johnson: Well, I think you said it yourself right, from an animal health perspective, these are leading solutions in gut health and in the overall health status of the animal.

From a sustainability perspective, this gives us even more tools in our toolkit to help reduce emissions but also improve of feed conversion that’s going to lead to more productive animal ultimately leading to more sustainable protein production. So we think across the board, this is really interesting with those mega trends.

I think that’s really what gets us excited about the opportunity here is that this [acquisition] continues to advance our toolkit.

Roembke: And when will the purchase be finalized?

Johnson: You know, it’s not done until it’s done. So we’re working towards a quick resolution here. But we will certainly announce that in the market just as soon as we get all the I’s dotted and T’s crossed.

Roembke: Very good. Thank you so much, Mike. And thanks to everyone for tuning in.

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