FBA Issue 19: March / April 2008

 

Kemira: "Nobody should do it better"

 

by Gemma C DELMO

 

 

With feed grain prices touching all-time highs, livestock producers and feed millers are looking for ways to extend their scarce supplies of corn and soy. In this context, grain spoilage represents a great economic net loss. Hence, the impetus to create feed additives that prevent or treat crops from biohazards and toxic contaminats such as moulds, salmonella and mycotoxins.

 

Consequently, the need to extend scarce feed grain supplies has intensified already intense competition among feed supplement makers. In this global competition, Kemira is an aggressive contender who is geared up to seize a bigger chunk of the feed additives market.

 

"Kemira is a stock-listed company so our performance is evaluated by our share price and share holder returns. Kemira strives for more because if you don't do that and stand still, you are basically moving backwards," says Dr. Han van der Broek, the company's Area Sales Manager for Asia Pacific.  "A growth rate of 10 percent is not satisfactory in markets that grow 20 to 30 percent per annum. You will lose market share and customer confidence."

 

History

 

With its global headquarters based in Helsinki, Finland, Kemira is a chemicals group that is made up of four business divisions: Kemira Pulp and Paper, Kemira Water, Kemira Specialty and Kemira Coatings. Created and owned by the Finnish state in the 1920s, Kemira started out as a supplier of sulphuric acid and superphospate for fertilizers to achieve the country's goal of attaining grain self-sufficiency. The following decades have been fruitful for Kemira as the company began building more plants with increased production capacity nationwide.

 

Its global trade started in the 1960s with small-scale exports of fertilizer and industrial chemicals. Getting a good grip in the international market prompted the company to build its first factory outside Finland in 1982 with a fertilizer plant in the UK, operating under the name Kemira Ltd.

 

Its success has spawned more foreign operations and Kemira -- now a private stock-listed company -- is among the world's foremost makers of formic acid, derivatives of organic acids, organic salts and blends, calcium propionate, formates and acetates for acidity control, catalyst, raw material and microbial control. The company's vertical integration allows it to internally manufacture its own raw materials for feed additive production ¡§Ca big advantage in this era of rising commodity prices. At this time, Kemira operates in 40 countries and generated 2.5 billion euros of revenue in 2006 with over 9,000 employees worldwide.  

 

Product enhancers

 

Within its vast corporate empire, Kemira's feed ingredient business belongs to Kemira Specialty, which according to van de Broek, contributes 20 percent of total global turnover. The feed department is divided into two segments: Performance Enhancement promotes acidifiers or natural growth promoters for swine and poultry feeds as a replacement for antibiotics which are currently banned in EU. Feed Safety products or feed additives are designed to control mould, mycotoxin and salmonella. Brand names include Propcorn for mould inhibitors, Add-Safe for feed preservatives, KemiCrimp to control mould in moist grains, Calprona Rumen for ruminant performance, Bio-Add, a salmonella inhibitor, and KemiSile, which is used for silage preservation.

 

Acidifiers are Kemira's main feed additive product. Acidifiers are known to lower gastric pH (acid) that can result to increased activity of proteolytic enzymes, improved digestibility and inhibited proliferation of pathogenic bacteria such as E. coli and salmonella in the animal's gastrointestinal tract. Also available as water additives, acidifiers also serve as an energy source in the intestine, as well as stimulating digestive enzymes and improving mineral solubility. Calprona and NutriSure are Kemira's brand names for acidifiers used in poultry and pigs.

 

As grain shortages implicitly make more attractive the value-proposition of acidifiers, they have compelled Kemira to become more ambitious in its bid to seize the top market spot. "In a more and more competitive global market place, it is important for a company to move from good to great," says van der Broek. "With this of course, come certain expectations. Kemira is expected to be a competitive player as it is at the fore front of acidifier and preservative market and our Production and Research Development activities are already geared towards that."

 

 

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