Supporting sustainable growth in the LATAM livestock sector

Agriculture plays a central role in many Latin American economies, according to a recent World Bank report. It “contributes to economic growth, generates poverty-reducing employment and helps ensure food and nutrition security”. Agricultural production accounts for almost 38% of the region’s total area and 14% of its total employment. In Brazil alone it contributed more than a quarter of the country’s GDP in 2021. Latin America’s thriving livestock sector is already a significant part of this agricultural success story. And that contribution is set to increase over the next 10 years. That’s according to a recent report from the Organisation for Economic Co-operation and Development and the Food and Agriculture Organization of the UN. 

Growth fuelled by agile responses to global markets

The report predicts that overall agricultural production in the region will grow by 14%. Livestock production will account for 28% of that growth. A key contributor to growth is livestock producers’ agility in response to global market shifts. This agility was illustrated in the wake of China’s struggles with African swine fever in 2019. Brazilian producers expanded capacity, ensuring that more processing plants could supply China. The result was that in the first 10 months of 2020, pork shipments to the country were 123% up on the same period of 2019.

Soaring soybean prices are hurting margins

There are, however, two potential obstacles to an increase in regional livestock production. The first is soybean market volatility. Soybean meal is one of the most important protein sources in animal feed worldwide. And just three Latin American countries - Brazil, Argentina and Paraguay - account for more than half of the world’s soybean supply. All have experienced severe drought recently. This, along with several other factors including trade imbalances, has caused prices to shoot up. These higher soybean costs hurt livestock producers’ margins and could ultimately slow growth. 

Many producers are already taking action. They're incorporating solutions that reduce the environmental impact of their production. Our enzymes for animal feed, developed as part of the Feed Enzyme Alliance with our partner DSM, are one such solution. They’re widely used in livestock farming, where they support more sustainable growth by unlocking feed’s full potential. Enzymes are biological catalysts. They help break down feed ingredients to release more energy and nutrients. That leads to a range of cost and sustainability benefits.

Proteases help reduce feed costs and nitrogen runoff

The volatile soybean market means it’s more important than ever for livestock producers to get the most from feed. Yet for many animals, up to 20% of the protein in their feed is indigestible. Adding proteases such as ProAct 360™ to feed makes this protein more digestible. The result is improved animal performance. Proteases also give producers the potential to reduce soybean meal and synthetic amino acid use, for lower feed costs. There’s also an environmental benefit, as supplementing feed with proteases leads to lower nitrogen levels in manure. That reduces the risk of runoff entering and harming aquatic environments. With all these benefits, it’s unsurprising that feed proteases are becoming a core tool of livestock diets around the word. 

By breaking down phytate, phytases release phosphorous from feed, making it available to the animal. That means livestock producers can reduce their reliance on inorganic phosphates yet maintain animal performance. The result is reductions in feed costs and emissions of phosphorus and greenhouse gases. Adding just 25g of HiPhorius™ 40 to every metric tonne of feed consumed by ten million broilers could cut PO4-equivalent emissions by 30 metric tonnes. It could also reduce methane (CH4) Nitrous oxide (N2O) and carbon dioxide (CO2) emissions by 850MT of CO2-equivalents. That’s roughly the same saving in CO2 as could be achieved by taking 354 cars* off the road for a year. Phytate also binds calcium, iron and zinc. So when phytases break it down, these essential minerals are released for the animal’s use. 

*Calculations based on American gasoline-powered passenger vehicles as per the US EPA Greenhouse Gases Equivalencies Calculator.