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Alfalfa Market Size, Share & COVID-19 Impact Analysis, By Animal Type (Cattle, Horse, and Others), By Feed Type (Hay, Cubes, and Pellets) and Regional Forecast, 2021-2028

Region : Global | Format: PDF | Report ID: FBI103597

 

KEY MARKET INSIGHTS

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The global alfalfa market size was USD 19.87 billion in 2020. The market is projected to grow from USD 21.63 billion in 2021 to USD 35.20 billion in 2028 at a CAGR of 7.2% during the 2021-2028 period. The global impact of COVID-19 has been unprecedented and staggering, with alfalfa witnessing a negative impact on demand across all regions amid the pandemic. Based on our analysis, the global market registered a slight decline of -7.7% year-on-year (YOY) growth in 2020. The rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.


Spread of COVID-19 in Asia Pacific and Europe to Restrict Market Growth


Asia Pacific is home to the majority of the world's animal population; it has the biggest alfalfa market share. However, because to the COVID-19 pandemic, alfalfa hay imports, production, and exports in the Asia Pacific region have been postponed until 2020. Despite the fact that demand for animal feed has remained largely consistent in 2020, the coronavirus outbreak has had a significant impact on supply. To control the spread of the disease, many countries have implemented various policies affecting people, industries, enterprises, factories, and consumers. Soybean, corn, and wheat will be used less in animal feed, according to researchers. Because of the controls and laws in place, there is still a mismatch between supply and demand for forages around the world.


Exports to non-EU nations have been outlawed in several countries, causing serious demand-supply issues in the animal feed business. Grain exports such as alfalfa, soybeans, bakery equipment, flour, maize, barley, and wheat are prohibited. Due to China's logistical challenges, there was also a major gap in China's imports, as the supply of containers and vessels was disrupted, as was the transit of some micro-ingredients. Many Southeast Asian economies rely on migrant workers. These migrant laborers began returning to their home countries after being subjected to strict lockdown rules, shattering distribution, supply systems, and manufacturing. As a result, big animal feed manufacturers are left with a considerably decreased staff. Because of the challenges faced during the pandemic, most governments designated agricultural activity to be critical. As a result, after a few months, the market was able to recover.


LATEST TRENDS


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Use of Alfalfa Pellets in Horse Feed Boosting Market Growth 


There has been a continuous increase in the horse population in the last few years. The growth of wild horse species is comparatively very fast with other species.  The product cubes are considered heavy food for species such as chicken, sheep, and goats. Moreover, pellets are costlier than the hay bales, have double the price of hay bales and are easy to carry than the hay bales. Hence farmers in developed regions with the ability to afford the pellets chose them over hay bales and cubes.


DRIVING FACTORS


Increased Demand for Nutritious Animal Feed Driving Market Growth for Nutritionally Balanced Feed


The cattle feed business is experiencing rapid growth as milk producers have replaced traditional feed with nutritionally balanced compound feed. Animal owners have realized the tangible benefits of yield improvement of nutritional feed. Asia-Pacific is the leader in the livestock industry and is home to the highest livestock population. Livestock production in the Asia Pacific region has been growing faster than any other agricultural sub-sector mainly due to the substantial growth of pig, livestock, and poultry industries, as the livestock industry is the most crucial part of agricultural development. Livestock products contribute for around 40% of the total agricultural output in global sales. In addition, the increase in the consumption of animal products due to population growth and increased living standards is expected to boost the product’s adoption. Thus, the rise in consumption of livestock products would fuel the necessity to produce an adequate animal population that would require nutritious feed.


Surge in Commercial Livestock Farming Increasing Demand for Nutritious Feed Options to Bolster Growth


The industrialization of agriculture radically transformed the method of food production in all parts of the world. The livestock sector is rapidly experiencing industrialization, particularly in developing or emerging economies, where most meat production growth is projected to occur. The last few years have seen increased agricultural land due to the rapid industrialization of agro-businesses and farming. This factor is expected to boost the alfalfa market growth in the coming years. However, livestock production and cattle feed production have faced many opportunities and challenges in the past. Hence, the focus on improving the productivity and efficiency of feed is increasing.


Therefore, the surge in livestock industrialization is likely to boost the consumption of the product through various animal feeds.


RESTRAINING FACTORS


Challenges Related to Gap Between Demand and Supply of Cattle Feed


Although improvements in the productivity and efficiency of the feed remain vital objectives, factors such as animal demands and feed supply also need to be considered for the growth of the alfalfa industry. Animal feed and nutrition quality play an important role as it is the biggest cost factor in dairy, beef, sheep, goat, pig, and poultry production. Moreover, cattle feeding is an important factor in the livestock sector. Therefore, the surge in demand for animal products and struggles in the supplies of feed commodities restricts the market growth.


SEGMENTATION


By Animal Type Analysis


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Cattle Segment Holds Major Market Share Due to a Large Population of Cattles and Greater Annual Consumption


Based on animal type, the segment includes cattle, horses, others. The cattle segment dominates the market owing to a large number of cattle animals in all the regions. The Asian region is home to a larger number of cattle, sheep, goats, and horses; thus, with a large number of cattle in India, China, Bangladesh, Pakistan, and a greater number of horses in Afghanistan, there is a huge demand for alfalfa products as animal feed in this region hence market players have prominent growth opportunities in this region.


Other animal segments is expected to showcase promising growth due to the rising consumption of meat and other non-veg food products worldwide. In countries such as China, Japan, Mexico, UAE, and Brazil, meat consumption has increased in the last few years. Hence, this factor offers promising growth opportunities for the global market growth.


By Feed Type Analysis


Hay segment to Hold Major Share Owing to demand for Hay from Developing Countries and Animal Groups


Hay segment dominates the global market in 2020 and is expected to retain its dominance during the forecast period. Hay is the traditional product popular among farmers from all income groups. While farmers with more income are transitioning towards cubes and pellets, farmers from developing countries still prefer hay to feed animals as they cannot afford cubes and pellets. Thus, the growing number of animals worldwide, expanding dairy and the meat industry are the factors that boost the growth of the hay segment. Hence, the hay segment is expected to grow with a significant CAGR during the forecast period.


REGIONAL INSIGHTS


Asia Pacific Alfalfa Market Size, 2020 (USD Billion)

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Asia Pacific holds the major market share with a value of USD 9.65 Billion in 2020. The increasing adoption of alfalfa in animal feed in developing countries such as India, Indonesia, Vietnam, Australia, Bangladesh, and Pakistan has elevated its demand over the past few years. In addition, the growing demand from the farmers propels the market growth in the region.


U.S. holds the majority share of North American alfalfa market size, accounting for around 67% of the total market share. The U.S. is taking strong measures to increase and strengthen its livestock industry. On September 30, 2018, the U.S. government announced United States-Mexico-Canada Agreement (USMCA). USMCA would expand market access for U.S. dairy, poultry, and eggs exports to Canada. This factor will help the consumption of eggs, poultry, and dairy products in Canada while at the same time it will help the U.S. farmers by exporting their products across borders. In North America, beef cattle consume the majority of cattle feed produced, and the consumption accounts for around 68% of the total feed production while the dairy cattle feed accounts for 32% roughly. This percentage shows that the North American population depends on beef for a majority of their animal-sourced protein. Hence, the demand for alfalfa in cattle feed is continuously increasing from the livestock operators in the region. Moreover, there has been an increase in the demand in Mexico and Canada, making way for the market players to provide new products and adopt new strategies in the alfalfa industry in North America.


Throughout the E.U., the livestock sector is one of the major players in the agricultural economy and its land use. The relative importance of different subsectors of agricultural economy varies enormously among member states, influenced at the same time by cultural values and biophysical conditions. In the European region, the hay segment accounted for the majority consumption of feed in 2020. The production of milk and dairy products is of high value for the European livestock sector as it accounts for approximately 15% of agricultural output. Furthermore, the EU is a major player in the global dairy market as the leading exporter of many dairy products. These factors promise numerous growth opportunities for this market to grow in this region.


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The livestock industry is a prominent sector for countries in Latin America and the Middle East and African regions, and it is also a primary food source. Livestock production is among the most important economic, cultural, and social strategies to maintain the welfare of communities. With the presence of vast areas supporting favorable climate patterns and strong supply of grains and fertilizers, Brazil, Argentina, and Africa can be the major livestock producers in the Latin America and Africa region and will help in meeting the food demands of the region. According to FAO, the livestock industry in South America has expanded at a 3.7% higher annual rate than the worldwide average 2.1%.  Exports of beef increased at 3.2%, higher than the growth in the production rate, which was 2.75%. Although South America accounts for only 13.5% of the world's population, the region produces more than 23% of buffalo and beef meat and 21.40% of poultry products globally. These countries make up about 10% and 11.2% by weight in eggs and milk, respectively. The livestock sector in South America, the Middle East, and the Africa region has experienced growth in recent decades. This rapid growth of food from the global population provides growth opportunities for the market players in this region.


KEY INDUSTRY PLAYERS


Focus on Expanding Business In Newer Geographies to Welcome New Opportunities


Alfalfa industry consists of local and international market players, and the number of local players in this market is more than the international players. Market players are continuously expanding their businesses and expand their footprint in new countries. Considering the increasing demand for various alfalfa feed products, players are making their products available in international markets either by expanding themselves or entering into a partnership with other local players in the respective markets. Brands such as Nutreco NV and Bayer Animal Health signed a global research and development collaboration agreement; the joint project will advance innovative solutions for gastrointestinal health in dairy and beef cattle. In another move, ADM acquired Neovia Company, an animal nutrition company, to help ADM increase its value-added products and solution.


LIST OF KEY COMPANIES PROFILED:



KEY INDUSTRY DEVELOPMENTS:



  • November 2020:  S&W Seed Company, a global agricultural company, entered into a partnership with Calyxt, Inc. to license an improved quality alfalfa seed in the U.S. and other selected geographies.

  • December 2019: Land O' Lakes launched a new animal feed manufacturing plant in Kenya. The expansion will help the company build its presence and help Kenyan farmers.


REPORT COVERAGE


An Infographic Representation of Alfalfa Pellets Market

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The market research report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading product application areas. Besides this, the report offers insights into the global alfalfa industry trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that have contributed to the market's growth over recent years.


Report Scope & Segmentation:












































  ATTRIBUTE



 DETAILS



Study Period



2017-2028



Base Year



2020



Estimated Year



 2021



Forecast Period



2021-2028



Historical Period



2017-2019



Unit



Value (USD Billion)



Segmentation



By Animal Type



  • Cattle

  • Horses

  • Others



By Feed Type



  • Hay

  • Cubes

  • Pellets



By Geography



  • North America (By Animal Type, Feed Type, and Country)

    • U.S. (By Animal Type)

    • Canada (By Animal Type)

    • Mexico (By Animal Type)



  • Europe (By Animal Type, Feed Type, and Country)

    • France (By Animal Type)

    • Spain (By Animal Type)

    • U.K. (By Animal Type)

    • Italy (By Animal Type)

    • Germany (By Animal Type)

    • Rest of Europe (By Animal Type)



  • Asia Pacific (By Animal Type, Feed Type, and Country)

    • China (By Animal Type)

    • India (By Animal Type)

    • Japan (By Animal Type)

    • Australia (By Animal Type)

    • Rest of Asia Pacific (By Animal Type)



  • South America (By Animal Type, Feed Type, and Country)

    • Argentina (By Animal Type)

    • Brazil (By Animal Type)

    • Rest of South America (By Animal Type)



  • Middle East and Africa (By Animal Type, Feed Type, and Country)

    • UAE (By Animal Type)

    • South Africa (By Animal Type)

    • Rest of the Middle East & Africa (By Animal Type)





Frequently Asked Questions

Fortune Business Insights says that the global market size was USD 19.87 billion in 2020 and is projected to reach USD 35.20 billion by 2028.

The market is projected to grow at a CAGR of 7.2% in the forecast period (2021-2028).

By animal type, the cattle segment is expected to be the leading segment in this market during the forecast period.

The surge in livestock industrialization is the key factor that is driving this market

Alfalfa Monegros, S.L. Gansu Daye, Anderson Hay & Grain Inc., and Standlee Hay Company are the major players in the market.

Asia Pacific dominated the market share in 2020.

The industrialization of the livestock industry in developing countries is expected to drive its growth.

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