Emerging trends in Latin American aquafeed production

As the Latin American aquaculture industry evolves and grows, so does the aquafeed industry. In the region, there are basically four major players in the aquafeed arena. Chile, the largest aquafeed producer in the region, has developed a highly advanced salmon industry, both in feed technology and nutrition.

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As the Latin American aquaculture industry evolves and grows, so does the aquafeed industry. In the region, there are basically four major players in the aquafeed arena. Chile, the largest aquafeed producer in the region, has developed a highly advanced salmon industry, both in feed technology and nutrition. It is followed by Brazil, then Ecuador, which is a leading shrimp exporter. Mexico ranks fourth, with shrimp and tilapia, and to a lesser extent, trout and marine species.

In terms of feed production, “specifically in the aquaculture sector in Latin America, information is scarce and not very accurate,” says Marcel Joineau, market information coordinator, FeedLatina, the Latin American feed manufacturers association.

Ecuador is the number one shrimp feed producer in the region, with approximately 3.2 million metric tons of shrimp feed per year. In the past, Mexico ranked second, but now, Brazil is producing more.

“Ecuador, with 170,000 hectares of shrimp ponds has been a great lab for the last 30 years, turning it into a leader,” says Danny Vélez, vice president of Afaba, the Ecuadorian Feed Manufacturers Association.

Meanwhile, Mexico’s potential is growing. “An interesting piece of information is that after the United States, the second largest tilapia importer from China is Mexico,” says Jaime Almazán, general manager of Alimentos El Pedregal, the largest fish feed producer in Mexico.

Fish feed production

Fish feed production shows a promising future. In 2013, Chile produced 1.18 million metric tons of salmonid feed. “For the next two years, we estimate an important growth,” says Constantino Siderakis, commercial manager at EWOS Chile Alimentos Ltda., a Chilean subsidiary of EWOS, a leading Norwegian salmon feed producer.

Fish feed production is growing in Mexico, as well, “particularly tilapia, mainly due to Acuagranjas Dos Lagos, a Regal Springs company located in the southern state of Chiapas in México,” says Almazán. Regal Spring is the largest tilapia producer in the world, with operations in Honduras and Indonesia.

“In 2010, fish feed production was around 35,000 million metric tons/year, but in 2013 production could have reached 75,000 million metric tons. It is odd, but now Mexico produces the same amount of fish feed, or even more, than shrimp feed,” says Marcelo Costero, marketing director of Vimifos, an aquafeed manufacturing company and the largest shrimp feed producer in the country, located in the state of Sonora, in northwest Mexico.

“Tilapia production in Mexico is growing and, therefore, tilapia feed,” says Almazán. “I think 35,000 million metric tons of tilapia feed were produced in Mexico in 2013, and around 4,000 million metric tons of trout feed, 500 million metric tons of carp feed and 500 of catfish feed.”

Tilapia cultivation is growing worldwide because tilapia feed does not depend on fishmeal. Almazán does not foresee a future of salmon and rainbow trout because feeding depends on fishmeal. In fact, trout production in Mexico has not grown in the last five years.

In Chile, yellowtail, corvina drum, Southern hake and cod icefish are just starting to be cultivated, so aquafeed for these species is still negligible,” says Siderakis. Sea bream, croaker and yellowtail are marine fish that are starting to attract interest in Mexican aquaculture.

“We were so focused to shrimp, with its enormous financial and production success, that no investor actually saw these fish as an alternative,” notes Costero. “Now, with the current shrimp sanitary problems, shrimp producers and others are turning to these marine fish.”

Shrimp feed production

Ecuador has finally recovered from the shrimp white spot syndrome that occurred 15 years ago. The country has almost doubled shrimp exports, from a record high of 253 million pounds in 1998 to 474 million pounds in 2013.

“We estimate a production of 370,000 million metric tons of shrimp feed produced in Ecuador in 2013,” says Vélez. In Ecuador, aquafeed means almost exclusively shrimp feed, since it accounts for 95 percent of total aquafeed production.

The shrimp feed outlook in Mexico is different. The scenario has changed in the last four years, mainly due to the white spot syndrome and the early mortality syndrome that has affected aquafeed production as “around 80 percent of Mexican aquafeed production used to be shrimp feed,” says Costero.

On the same token, José Ignacio Salas, aquaculture director at Cargill Mexico, says: “We are working closely with customers and the industry to overcome these challenges and restore industry productivity rates.”

In the past, shrimp feed accounted for 230,000 million metric tons of the 260,000 million metric tons of aquafeed Mexico produced. But today, after the sanitary ravages, shrimp production in 2013 decreased to one third, but shrimp feed decreased in a largest proportion, to about 60,000 to 65,000 million metric tons.

Shrimp feed has a mixed outlook. In Ecuador, there was a 20 percent increase in shrimp feed production comparing 2013 with 2012. “However, we expect a more moderate growth rate, of around 8 to 10 percent,” says Vélez.

In Mexico, “shrimp producers have become undercapitalized,” says Almazán. Cargill’s Salas commented, “It is necessary to find other kind of support, such as local funding, to restructure the short and long-term debts of producers.”

Feed manufacturing challenges

In Ecuador, “the challenge is to keep innovating in feed production, since 90 percent of Ecuadorian shrimp is fed with locally produced feeds,” says Vélez.

The challenge faced by producers in Mexico is raw material availability. “We need to anticipate our purchases to avoid shortages” says Almazán. Aquaculture is highly influenced by the environment or temperature, so fish or shrimp eat more or less, making it hard to anticipate how much raw materials are needed.

According to Costero, the challenge is how to best use fishmeal and even more fish oil.

“Pressure on fish oil and fishmeal is increasingly growing. It is turning into bottle neck of aquafeed production” says Costero.

Chilean aquafeed producers face the same problem. But all are working on solving this. Vélez says that “the Ecuadorian aquafeed industry has developed feed formulas that do not depend so heavily on marine sources, as it used to be 10 years ago.”

On the other hand, Siderakis says that his company “has been working in developing alternative raw materials to obtain nutrients from non-marine ingredients.” For instance, in the “Fish Feed for the Future” program carried out during the last decade in Norway, low-marine-ingredient fish diets are tested, and they have been able to prove that salmon can be produced with nutrients coming from ingredients other than fishmeal and fish oil, without altering final product quality.

Salas considers one of the challenges in Mexico now to be dealing with idle capacity resulting of low shrimp feed demand in Mexico.

Feed technology developments

“We are manufacturing micropellets of 0.8 and 1 mm,” Almazán points out, for fish fingerlings and shrimp nurseries. “We are the only ones in Mexico manufacturing micropellets. Worldwide, there are very few companies doing so. We are very proud of it.”

Micropellets lead to cleaner water; because starch is gelatinized, it is harder, less dusty and results in less feed wastage.

In feed formulation, the Mexican sanitary crisis has pushed to make some changes. “In the last cycle, we formulated feed reinforced with special additives in order to support the shrimp through a better nutrition,” adds Cargill’s Salas.

In Chile, state-of-the-art technologies for nutritional evaluation of vegetable and animal raw materials have been implemented, as well as in pelleting.

What’s on the horizon

“As long as we do not challenge Nature, as long as we do not reach the high intensification as in other countries, I think we will maintain a moderate but stable growth,” says Vélez.

Siderakis says that “if there is no consumption contraction in the salmon market or a sanitary event as in 2007 and 2008, we can expect a 5 to 7 percent increase as of 2016.

In Mexico, tilapia feed will grow, but not trout feed. Costero thinks that shrimp production will recover within two years. Both Salas and Almazán agree on this.

Feed producers expect that a fish oil replacement will be available soon, such as with microalgae. “We need to focus into getting alternative protein sources to be converted into animal protein,” says Costero.

Aquafeed, both in Latin America and the rest of the world, has to keep on increasing. Fisheries are saturated and overexploited. By 2050, aquafeed producers will need to provide enough feed to produce the same amount of fish and shrimp obtained today from fisheries.

“The extra 2 billion people within 35 years will need to be fed protein, and we need to contribute to that”, says Almazán. Salas agrees, “At Cargill, we see aquaculture as a pathway to meeting the world protein demand and we look forward to bringing new ideas and products to the industry.” 

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