Edible Insects For Animal Feed Market

Edible insects and insect-based products are enriched with a high amount of nutritional protein. This makes them an ideal alternative to conventional protein sources in animal nutrition, and are thus gaining traction. As a dry product, edible insects contain 50% to 80% of protein, which is essential for animal nutrition. Edible insects also contain amino acids, which are highly digestible for animals. Some insects contain lauric acid, antimicrobial peptides, and chitin, which have immune-boosting properties. On the back of the high nutritional content of insects, and rising adoption as substitute protein sources, the edible insects for animal feed market is anticipated to witness impressive growth through 2030.

Anticipated COVID-19 Impact on Edible Insects for Animal Feed Market

With the virus spreading across the world, down-chain suppliers across key sectors are facing problems in meeting the demand. This is more evident at the current stage with ingredients in limited storage. Further increase in the closure of factories and ports will strain the supplies to a greater extent. With the ban on international travel and transport, edible insects for animal feed producers will be dependent on local producers and suppliers for the sourcing of raw material.

It is anticipated that the production clusters where edible insects for animal feed is reared will remain less impacted by the global pandemic of COVID-19. Feed processing companies in major countries, such as the U.S., where the demand for edible insects for animal feed is high, may suffer from the shortage of edible insects in the second quarter of 2020, as major suppliers are based in the European region.

A recovery is expected by end of the third quarter, or the initial phase of the fourth quarter of 2020. The impact will be seen across various end-use such as poultry feed, aqua feed, and swine feed. The extent of impact of CoVid-19 on demand and consumption is uncertain at the present stage. Today, analysis of the market impact of COVID-19 is a moving target, but all signs point to an ongoing negative global economic outlook through the first half of the year. Disruptions in the supply chain is the immediate threat to feed industry. As China’s feed industry saw significant recovery post COVID, similarly, other economies will see a gear-up in business with less impact.

Feed manufacturers are making strategic moves in order to be prepared for the worst. Companies are looking for alternative raw material sources. They will look out to expand their production bases across key geographies or demand clusters. Business expansion is pretentious, as the set-up cost is quite negligible or less capital intensive.

North America and Europe to Offer High Potential Investment Opportunities

The business set-up cost to start the production of insect-based animal feed products is very low at the initial stage. As the demand for these products increases, many manufacturers have increased their production capacities and are focusing on technical advancements. Investors are also identifying the potential of insect-based animal feed products as a lucrative prospect. Such investments have enabled manufacturers to increase production capacities to cater to the global edible insects for animal feed market. This growing interest and increasing production capacities of manufacturers is expected to drive demand, and subsequently the growth of the edible insects for animal feed market.

Edible insects for animal feed witness higher demand in established markets such as Europe and North America. A large number of start-ups offering insect-based products are located in these two regions. Many investors have identified potential gain by these sectors, and are investing in areas related to the insect-based product industry. The exponential rate of investments in companies offering insect-based products in Europe and North America is boosting the growth of the global edible insects for animal feed market.

Ynsect, a France-based leading insect breeding company, raised US$ 125 Mn in its series C funding from a group of investors. This funding is the largest ever ag-tech funding deal outside the U.S.

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Regional Landscape of Edible Insects for Animal Feed Market

In the global edible insects for animal feed market, a large number of start-ups that focus on breeding and producing insect-based products are located in Europe. Increasing investments in the businesses of emerging manufacturers in this lucrative market are anticipated to increase the share held by Europe in the global edible insects for animal feed market over the coming years.

The market in Asia Pacific is projected to experience a robust growth rate, attributable to the increasing demand for insect-based products for animal feed and livestock farming. End-use sectors such as pet food and feed, livestock farming, and aquaculture are flourishing in the Asia Pacific region. Customer inclination toward insect-based animal feed, and high rate of adaptation of edible insects for animal feed in countries such as China and India, make them the most attractive markets in the Asia Pacific region. However, different regulatory laws with respect to every region are hindering the growth of the global edible insects for animal feed market to some extent.

Analysts’ Viewpoint

The global edible insects for animal feed market has witnessed significant growth over the past few years, and this growth rate is expected to continue over the forecast period of 2020-2030. Asia Pacific is projected to register the highest growth rate, on the back of increasing production of edible insects for animal feed in the region.

Players in the global edible insects for animal feed market are aggressively investing in expanding their production capacities. A large portion of market players consists of emerging manufacturers in the field of insect farming. They are focusing on acquisitions and joint ventures to increase their share in the global edible insects for animal feed market.