Black Soldier Fly Market by Product Type (Protein Meal

Black Soldier Fly Market by Product Type (Protein Meal, Biofertilizer, Whole Dried Larvae, Larvae Oil, and Other BSF Products), Application (Animal Feed, Agriculture, Pet Food, and Others), and Geography- Global Forecast to 2030

—Executive Report

Executive Report- Black Soldier Fly Market: 2019-2030

Page 1 of 34 © Meticulous Research| [email protected]

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TABLE OF CONTENTS

1. INTRODUCTION _____________________________________ 7

1.1. MARKET ECOSYSTEM _________________________________________ 7

1.2. CURRENCY AND LIMITATIONS __________________________________ 7

1.2.1. CURRENCY _______________________________________________ 7

1.2.2. LIMITATIONS _____________________________________________ 7

1.3. KEY STAKEHOLDERS __________________________________________ 8

2. RESEARCH METHODOLOGY ____________________________ 9

2.1. RESEARCH PROCESS__________________________________________ 9

2.1.1. SECONDARY RESEARCH ____________________________________ 9

2.1.2. PRIMARY RESEARCH ______________________________________ 10

2.1.3. MARKET SIZE ESTIMATION _________________________________ 11

3. MARKET INSIGHTS _________________________________ 13

3.1. INTRODUCTION ____________________________________________ 13

3.2. DRIVERS __________________________________________________ 13

3.2.1. RISING GLOBAL MEAT DEMAND _____________________________ 13

3.2.2. GROWING AQUACULTURE INDUSTRY _________________________ 15

3.2.3. INCREASING DEMAND FROM ANIMAL FEED INDUSTRY FOR ALTERNATIVE PROTEINS DUE TO RISING PRICES OF SOY MEAL ____ 16

3.2.4. INCREASING GOVERNMENT SUPPORT FOR THE USE OF INSECT MEAL IN LIVESTOCK FEED _________________________________ 17

3.3. RESTRAINTS _______________________________________________ 18

3.3.1. NON-STANDARDIZED REGULATORY FRAMEWORK ACROSS THE EUROPE ________________________________________________ 18

3.3.2. LIMITED ACCEPTANCE & APPROVALS FOR BSFL APPLICATION IN HUMAN DIET ____________________________________________ 18

3.4. OPPORTUNITY ______________________________________________ 19

3.4.1. GEOGRAPHIC EXPANSION IN EMERGING & DEVELOPED ECONOMIES ____________________________________________ 19

3.5. CHALLENGES _______________________________________________ 20

3.5.1. PRICING COMPETITION FROM PARENT INDUSTRIES _____________ 20



3.6. BSF DERIVED CHITIN AND CHITOSAN OPPORTUNITY ANALYSIS _______ 20

3.6.1. BSF DERIVED CHITIN TRENDS ______________________________ 20

3.7. REGULATORY ANALYSIS ______________________________________ 22

3.7.1. NORTH AMERICA _________________________________________ 22

3.7.2. EUROPE ________________________________________________ 23

3.7.3. ASIA-PACIFIC ___________________________________________ 24

3.7.4. REST OF THE WORLD _____________________________________ 25

4. MARKET ANALYSIS _________________________________ 26

5. APPENDIX ________________________________________ 30

5.1. QUESTIONNAIRE ____________________________________________ 30

5.2. AVAILABLE CUSTOMIZATION __________________________________ 33



LIST OF TABLES TABLE 1 EUROPE: INSECT MEAL POTENTIAL REPLACEMENT VOLUME IN THREE FEED

MARKET SEGMENTS, 2016 ................................................................... 16

TABLE 2 EUROPE: INSECT PRODUCTS AND THEIR EXPECTED YEAR OF APPROVAL IN FEED SEGMENTS ................................................................................ 17



LIST OF FIGURES FIGURE 1 SCOPE OF THE GLOBAL BLACK SOLDIER FLY MARKET ............................... 7

FIGURE 2 KEY STAKEHOLDERS IN THE GLOBAL BLACK SOLDIER FLY MARKET ............ 8

FIGURE 3 RESEARCH PROCESS ............................................................................. 9

FIGURE 4 KEY EXECUTIVES INTERVIEWED ........................................................... 10

FIGURE 5 PRIMARY RESEARCH TECHNIQUES ........................................................ 11

FIGURE 6 MARKET SIZE ESTIMATION .................................................................. 11

FIGURE 7 MARKET DYNAMICS ............................................................................ 13

FIGURE 8 WORLD POPULATION GROWTH, 2010 VS. 2050 ...................................... 14

FIGURE 9 CONTRIBUTION OF SEAFOOD SUPPLY TO 2030 ...................................... 15

FIGURE 10 SWOT ANALYSIS: BSF DERIVED CHITIN & CHISTOSAN INDUSTRY ........... 21

FIGURE 11 COMMONLY SUGGESTED MARKET DISRUPTION STRATEGIES FOR BSF DERIVED CHITIN & CHITOSAN ............................................................. 22

FIGURE 12 EUROPE: REGULATORY APPROVAL FOR INSECT USE IN ANIMAL FEED, 2017 ........................................................................................................ 24

FIGURE 13 PROTEIN MEAL TO DOMINATE THE GLOBAL BLACK SOLDIER FLY MARKET DURING THE FORECAST PERIOD .......................................................... 27

FIGURE 14 ANIMAL FEED APPLICATION TO DOMINATE THE GLOBAL BLACK SOLDIER FLY MARKET DURING THE FORECAST PERIOD ........................................ 28

FIGURE 15 GLOBAL BLACK SOLDIER FLY MARKET SHARE (2019) AND CAGR (2019-2025), BY GEOGRAPHY ....................................................................... 29



ACRONYMS

Acronym Description

APAC Asia-Pacific

EU European Union

FDA Food and Drug Administration

R&D Research and Development

ROE Rest of Europe

ROW Rest of the World

U.K. United Kingdom

U.S. United States

WHO World Health Organization

FAO Food and Agriculture Organization

ACFS National Bureau of Agricultural Commodity and Food Standards

GAP Good Agricultural Practices

CELSS Controlled Ecological Life Support System

GMP Good Manufacturing Practice

FFPIDI French Federation of Producers, Importers and Distributors of Insects

IBERS Institute of Biological, Environmental & Rural Sciences

BFR German Federal Institute for Risk Assessment

IPIFF International Platform of Insects for Food and Feed

ACNF Advisory Committee on Novel Foods

CAGR Compound Annual Growth Rate



1. INTRODUCTION

1.1. MARKET ECOSYSTEM

FIGURE 1 SCOPE OF THE GLOBAL BLACK SOLDIER FLY MARKET

Source: Meticulous Research® analysis

1.2. CURRENCY AND LIMITATIONS 1.2.1. CURRENCY

� The currency used in this report is USD, with market size indicated in USD million

� For companies reporting their revenues in USD, the revenues were taken from their annual reports

� For companies reporting their revenues in other currencies, the average annual currency conversion rate was used for that particular year to convert the values to USD

1.2.2. LIMITATIONS � Some of the companies in this market are privately owned and their revenues are not

available in the public domain. Hence, revenues for those companies are not included in the report. However, the collective revenue of these companies has been considered in the market size calculations

� Company developments not reported in the public domain are not included in the report

Global Black Soldier Fly Market

By Geography

North America

Europe

Asia-Pacific

Rest of the World

Protein Meal

Biofertilizers (Frass)

Whole Dried Larvae

Larvae Oil

Type

Chitin/ Chitosan

Animal Feed

Agriculture

Pet Food

Other Application

Applications

Other BSF Products



1.3. KEY STAKEHOLDERS

FIGURE 2 KEY STAKEHOLDERS IN THE GLOBAL BLACK SOLDIER FLY MARKET


Key

Stakeh

olders

Key P

layers

Â

Â

Â

Â

Â

Â

Black Soldier Fly Processing Companies

Black Soldier Fly Product Dealers and Distributors

Alternative Protein Suppliers

Regulators

Distributors

Professional Societies



2. RESEARCH METHODOLOGY

2.1. RESEARCH PROCESS 9 Meticulous Research® employed comprehensive and iterative research methodology for

the global black soldier fly market analysis focused on minimizing deviance in order to

provide the most accurate estimates and forecast possible. Our research methodology is

governed by a six-step process: Scope Definition and Research Design, Data Collection,

Data Validation, Data Analysis, Data Triangulation, and Data Formulation.

FIGURE 3 RESEARCH PROCESS

Source: Meticulous Research®

9 The rigorous period of information is gathered from both secondary and primary sources

through several interviews with key industry participants from demand and supply side,

channel players, regulators, and standardization bodies. Data gathered from these

interviews and surveys is further analyzed and engineered to understand buying,

spending, demand and supply patterns, and estimate market sizes and forecasts.

2.1.1. SECONDARY RESEARCH 9 In compiling the secondary research data for this study, Meticulous Research® has

conducted a comprehensive search of relevant published information, including annual

reports, SEC filings, investor presentations, magazines, associations, external proprietary

database searches, and other available secondary sources. The company’s focused and

disciplined approach to this process, coupled with in-house expertise in secondary

Bottom-UpTop-down

Scope Definition and Research Design Data Collection Data Validation

Report Publication Data Formulation Data Triangulation Data Analysis

Secondary Research- Annual Reports, SEC Filings, Company

Presentations, Regulations, Standardization bodies, Academic studies, Third-party

sources, Internal data base

Primary Interviews with players, channel, regulators, de

mand side surveys, vendor briefings

Client Enquiries, Emerging Trends, Recent developments in

the global market, Conferences, Market

Due- diligence,

Market Engineering, Historical Trends Analysis, Impact Analysis, Survey Data

Analysis, Participants Interview Analysis, Spending Analysis

Variance Check, Error Sampling, Reassurance

Check, Consistency Check, Final Quality Check



research, extensive proprietary in-house databases, and strong knowledge capital ensure

targeted and comprehensive results.

9 This subsequently provides the basis for the design of research questionnaires and

interview discussion guides, the identification of data gaps, and assistance in the selection

of appropriate targets used in the primary research phase.

2.1.2. PRIMARY RESEARCH 9 A key element in Meticulous Research’s research methodology is the primary data

collection phase that includes direct discussions and interviews with a broad base of key

opinion leaders (KOLs) throughout the value chain across the globe. Meticulous Research®

has an established panel of executives and managers, technical experts, and other

industry experts at suppliers, software providers, distributors, and end users. Access to

such specialists, market data, market insights, trends, and alternative perspectives

throughout the value chain ensures that the analysis done by Meticulous Research® is

thorough, robust, verified, and usable.

FIGURE 4 KEY EXECUTIVES INTERVIEWED


CXOs –Preferably

COO/CIO/ CDO

Strategy Consultants /

Executives

SMEs / External Consultants /

Industry Experts

Senior Managers

Business Heads / Key

Stakeholders in Govt. Agencies

Delivery Heads/ Managers/ Key

Executives

Program / Project

DirectorsExternal Consultants /

Industry Experts

PROFESSIONALS INTERVIEWED

FOR THIS STUDY



9 In the primary research process for this research study, the industry experts such as CEOs,

Presidents, Directors, Marketing Directors, Business Managers, Marketing Managers, and

related key executives from various key companies and organizations throughout the value

chain across the globe have been interviewed, to obtain and verify both qualitative and

quantitative aspects of this research study.

FIGURE 5 PRIMARY RESEARCH TECHNIQUES


2.1.3. MARKET SIZE ESTIMATION

FIGURE 6 MARKET SIZE ESTIMATION


CATI

CAWI

CAVI

CASI

Telephonic Interviews

Web-based Questionnaire

Video Interviews (Skype, WebEx, etc.)

Survey through E-Mail(Word, Excel, etc.)

TOP DOWN

SUPPLY-SIDEDEMAND-SIDE IN-HOUSE EXPERTISE

PROJECT MANAGEMENT

DATA CHECKS

MODELING &

FORECASTING

PRIMARY INTERVIEWS

MICROFACTORS

SECONDARYSOURCES

MACROINFLUENCES

BOTTOM UP



9 The revenues of the leading companies were analyzed in the global black soldier fly

market. The bottom-up approach was implemented for arriving at the overall market size

of the global black soldier fly market. This overall market size was further used in the Top-

Down procedure to estimate the market sizes of all the other sub-segments of the market

such as global black soldier fly market by product type, application, and geography.

9 The penetration rates from secondary and primary research were used in the top-down

process in order to calculate the market size for the sub-segments. With the data

triangulation procedure and the validation of data through expert interviews, the exact

values of the overall parent and each individual market were determined in this market

research study.

9 All the percentage shares, splits, and breakdowns were discussed and verified through

primary research, and analysed to get the final quantitative data. In order to finalize the

overall market size estimation process and arrive at accurate statistics for all the market

segments and sub-segments, data triangulation and market validation procedures were

implemented.

9 Meticulous Research’s research benefits strongly from the ability to crosscheck data from

a number of different industry related perspectives and the company’s own researches,

reinforcing the integrity and veracity of data.

Post this, multiple check points are used to check consistencies, error samples, and variances.

Once the market data passes the tests and checkpoints, a report is published and made

available with us and our reseller partners.



3. MARKET INSIGHTS

3.1. INTRODUCTION The global black soldier fly market is expected to grow at a CAGR of 30.6% to reach $539.4

million by 2025 from $108.7 million in 2019. This market is mainly driven by increasing global

meat demand, growing aquaculture industry, increasing demand from animal feed industry for

alternative proteins due to rising prices of soymeal, growing government support for the use of

insect meal in livestock feed, and growing investment by the key players in the BSF industry.

However, factors such as non-standardized regulatory framework across the Europe and limited

acceptance and approval for BSFL application in human diet are hindering the growth of the

overall black soldier fly market.

FIGURE 7 MARKET DYNAMICS


3.2. DRIVERS 3.2.1. RISING GLOBAL MEAT DEMAND Global meet demand is growing significantly due to rapid growth in the world population.

According to the Population Reference Bureau (PRB), the global human population is expected to

grow by 75 million annually or with 1.1% per year. With this, the world population is expected to

reach 9.9 billion in 2050, an increase of 33% from an estimated 7.4 billion in 2017.

Opportunity

Challenges

Drivers

Restraints

• Rising Global Meat Demand • Growing Aquaculture Industry• Increasing Demand From Animal Feed Industry for

Alternative Proteins Due to Rising Prices of Soymeal• Increasing Government Support for the Use of Insect Meal in

Livestock Feed

• Non-standardized Regulatory Framework Across the Europe• Limited Acceptance and Approval for BSFL Application in

Human Diet

MARKET DYNAMICS

• Geographic Expansions in Emerging and Developed Economies

• Pricing Competition from Parent Industries



FIGURE 8 WORLD POPULATION GROWTH, 2010 VS. 2050

Source: The World Bank

The traditional livestock farming cannot keep up with the growth resulting in an estimated

shortage of 60-million-ton protein per year from 2025 (FAO). In addition, the global meat

consumption per capita is expected to increase to 35.4 kg r.w.e. (retail weight equivalent) by

2027, an increase of 1.1 kg r.w.e. compared to the base period. Despite the high population

growth rates in developing world, total consumption is also expected to increase by 1.4 kg r.w.e.,

half of the increase expected in developed countries. To fulfill this growing meat demand, meat

producers are focusing on improving the production and quality of meat with the help of high

quality protein containing feed in the diet of livestock. Moreover, an increasing number of health-

conscious consumers are demanding environmentally safe and chemical-residue-free meat. Such

factors are leading meat producers to adopt insect-derived feed such as BSFL protein meals.

Furthermore, insects are cheaper alternative protein source as compared to fish meal and soy

meal for animal feed. Hence, insects contribute to high-quality and low-priced feed for livestock,

poultry, and fish.

Thus, increasing population in the developing countries and subsequently growing meat

consumption leads to increase in the consumption of BSFL as an alternative protein source for

animal feed, thereby driving the growth of the global black soldier fly market.

2050

ASIA5,267 Million

+26%

57 MillionOCEANIA

+58%

707 MillionEUROPE

-3.8%

1,217 MillionAMERICAS

+29%

AFRICA2,478 Million

+137%

36 Million

OCEANIA

735 MillionEUROPE

ASIA4,170 Million

2010

944 MillionAMERICAS AFRICA

1,044 Million

6.9 Billion 9.9 Billion



3.2.2. GROWING AQUACULTURE INDUSTRY Over the last decade, the world has witnessed enormous growth in the aquaculture sector of

many developing countries of Asia and Africa. Nutrition and feeding play a central and essential

role in the sustained development of aquaculture. Hence, fertilizers and feed resources are

continuing to dominate aquaculture needs. In fish farming, nutrition is critical because feed

represents 40-50% of the production costs. Fish nutrition has advanced dramatically in recent

years with the development of new balanced commercial diets that promote optimal fish growth

and health. The essential nutrients for fish growth are amino acids, fatty acids, vitamins, minerals,

and energy-yielding macronutrients (protein, lipid, and carbohydrate). Further, according to the

Food and Agriculture Organization (FAO), it is projected that aquaculture will expand to 93 million

tons in 2030.

FIGURE 9 CONTRIBUTION OF SEAFOOD SUPPLY TO 2030

Source: Food and Agriculture Organization

BSF larvae contain high amounts of protein (~40%) and have a well-balanced profile of essential

amino acids. Therefore, it can be used as an alternative source of protein for fish feed. Owing to

these factors, some countries have approved the insect-based meals such as BSFL for aqua feed

applications. For instance, the European Commission (EC) has officially approved the use of insect

protein as a new form of aquaculture feed in 2017. Further, in 2018, the Food and Drug

Administration (FDA) and the Canadian Food Inspection Agency (CFIA) has approved the use of

insects as an ingredient in certain fish.

Thus, the growing aquaculture industry and government approval for the insect as aqua feed

leads to spur the demand for BSF in the aquaculture industry.

50%50%43%

57%

30%

70%

Aquaculture Fisheries

2010 2020 2030



3.2.3. INCREASING DEMAND FROM ANIMAL FEED INDUSTRY FOR ALTERNATIVE PROTEINS DUE TO RISING PRICES OF SOY MEAL

The developing geographies, such as Asia, Africa, and Latin America, will be experiencing human

population increase along with the economic growth and changing dietary patterns. This will

account for 70% increase in the demand for livestock products by 2050. Further, the prices of

livestock-based products have increased due to rise in the feed cost. At present, the feed cost

contributes ~60–70% of the total livestock production cost. Fish and soybean meal are the major

acting protein sources for the feed. However, these sources compete with food production for

humans. Moreover, availability of fishmeal has become limited due to over exploitation of marine,

causing rapid increase in the cost of these feed ingredients. As a result, the search for sustainable

alternatives has led to a growing interest in insects as a feed ingredient.

Insects have high levels of protein and their production has a small footprint. Insect species that

are mass-reared such as black soldier fly have received significant attention mainly due to its

ability to feed on different substrates including organic waste streams. The ability of BSF to

convert organic waste into high-quality nutrients has rapidly opened commercial opportunities

with the development products such as protein meal, which is a cheaper alternative protein source

as compared to fishmeal or soybean meal for pig, poultry, and fish feeds. Further, according to

FDA study, when soybean and fishmeal was replaced with BSF larvae meal in proportions of 10–

56% showed that the broiler quails and chickens had satisfactory taste, aroma, and nutritional

composition of the meat. In addition, BSF insects are also used as fish feed in Nile tilapia with

different levels BSF meal, which resulted in similar growth performance and feed conversion.

TABLE 1 EUROPE: INSECT MEAL POTENTIAL REPLACEMENT VOLUME IN THREE FEED MARKET SEGMENTS, 2016

Segment Market volume (Tons)

Type of ingredient to replace with insect meal

Replacement rate by insect meal

Room for insect meal demand (Tons)

Aquafeed Market in Europe

3,200,000 Fish Meal 10% 80,000

Poultry Feed Market in the Netherlands

1,400,000 Soy or Fish Meal 1% 70,000

Pig Feed (Weaner)

Market in the Netherlands

80,000 Soy or Fish Meal 1% 800

Source: All About Feed

Therefore, owing to factors such as high growth performance of BSF meal and rising prices for

fishmeal and soya meal, animal feed manufacturers have increasingly started incorporating BSF



ingredients into their feed products as an alternative source of protein, thereby driving the growth

of the global black soldier fly market.

3.2.4. INCREASING GOVERNMENT SUPPORT FOR THE USE OF INSECT MEAL IN LIVESTOCK FEED

There are many government authorities mandated to play a coordinating role in promoting the

sustainable supply of safe, healthy feed in the global insect feed industry. The support from some

of the government authorities for the consumption of BSF based products in animal feed is

growing its demand. For instance, in 2017, the European Government approved the use of feed

ingredients derived from BSF larvae in aquaculture feed. Also, in 2018, the Food and Drug

Administration (FDA) and the Canadian Food Inspection Agency (CFIA) has approved the use of

insects as an ingredient in certain fish and poultry species.

TABLE 2 EUROPE: INSECT PRODUCTS AND THEIR EXPECTED YEAR OF APPROVAL IN FEED SEGMENTS

Poultry Feed Pig Feed

Dried Insect Whole 2020 2020

Dried Insect Processed 2020 2020

Insect Protein 2020 2020

Source: All About Feed

Moreover, the European government legislation prohibits the use of dead insects or processed

insects in feed for chickens and pigs. However, it is allowed to feed live insects, insect oil or

hydrolyzed protein. According to the International Platform of Insects for Food and Feed (IPIFF),

the use of insect meal in pigs and poultry feed will be the main focus after the approval of its use

in aqua feed. The IPIFF expects that amendments for pig and poultry feed will take place in 2020.

This will create more market opportunities for insect meal producers to enter the huge poultry

feed market as of 2023.

Thus, growing government support to approve use of insect meal in feed is expected to fuel the

growth of the BSF market in coming years.



3.3. RESTRAINTS 3.3.1. NON-STANDARDIZED REGULATORY FRAMEWORK ACROSS THE

EUROPE Insect-eating is common in many countries such as Thailand, Vietnam, and others as well as

there is no regulatory hurdle for their production, marketing, and consumption. However, in

western countries, such as Europe, regulations present a significant barrier to the use of insects

in the feed and food. Western regulators are split on whether insects should be considered within

the existing feed legislation or constitute a novel food product, which requires extensive testing.

The novel food rules are very strict, and organizations have to go through the long approval

process and huge documentation prior to being able to sell insects in European markets.

Adding more worries to this, some European countries decided to diverge from the EU decision.

The National authorities in the U.K., the Netherlands, Denmark, Belgium, and Switzerland have

rejected the concept that insect requires a long approval process. However, these countries have

limitations on the import of insects from non-EU countries. In addition, in some countries, insects

are allowed to use in the poultry and pet food in Europe. For instance, in the Netherlands, niche

products such as insect lipid for piglet feed, protein meal for pet food, and live larvae for egg

producing chickens are permitted; but, in other European countries, the use of insect in animal

feed is strictly regulated.

Thus, this non-standardized regulatory framework across the Europe is restricting the growth of

the black soldier fly market.

3.3.2. LIMITED ACCEPTANCE & APPROVALS FOR BSFL APPLICATION IN HUMAN DIET

There is interest in black soldier fly larvae for human food from specific groups. At present, black

soldier fly products have not been approved for use in human food. Nutritionally, BSFL is

acceptable for human feeding because it contains 42% crude protein and 29% fat, although they

are higher in saturated fats. Further, the global protein consumption increased by 40% between

2000 and 2018; more than 50% of this increase was driven by Asia. Also, in 2018, annual per

capita average consumption of protein was 26kg, which is projected to grow by 27% to 33kg in

2025. Thus, the higher protein content of BSF has a potential to support the growing demand for

protein.

BSFL are edible, nutritious (especially when defatted), and can theoretically be reared more

sustainably than extant farmed insects. This makes them a potential protein source for human

both in the future and in the developing world. However, the primary usage of BSF in human food



systems is to reduce and recycle the waste biomass associated with other foods. Moreover, legal

prohibitions already limit the use of faces fed BSFL as an animal feed only. Other challenges in

making BSFL palatable for humans are the same as faced by all insects: sensory and cultural.

Though processing BSFL into human food is possible, there is no assurance that it is the best

solution for food insecurity. This is restricting the approval of BSFL for use in human food, thereby

hindering the growth of the global black soldier fly market.

3.4. OPPORTUNITY 3.4.1. GEOGRAPHIC EXPANSION IN EMERGING & DEVELOPED

ECONOMIES Over the recent years, there is a significant increase in the demand for the high-quality meat in

emerging economies such as Southeast Asia, Middle East and Africa, and Latin America, which is

mainly attributed to the population growth in Asia and Africa and increasing urbanization.

According to FAO, the global meat production is projected to expand to around 48 metric ton by

2025, predominantly in developing countries, which will account for approximately 73% of the

total production. Thus, to fulfill this demand, meat producers are continuously focusing on

improving the production and quality of the meat with the help of high-quality protein containing

feed. Such factors are leading meat producers towards the adoption of insect-derived feed such

as BSFL protein meals. Hence, the high demand for insect feed in the emerging economies

encouraging the insect producer to invest in developing countries. Owing to this opportunity,

major market player are expanding in this market. For instance, the AgriProtein is planning to

build a series of a factories in Africa, the Middle East, and Asia, mainly due to increasing demand

for a sustainable protein source for use in animal diets.

Moreover, according to Food and Agriculture Organization of the United Nations (FAO), from 2017,

the global demand for fish and shellfish is expected to reach almost 180 million tons in 2025.

However, dried and powdered fish feed such as anchovy, which is used as a feed for aquaculture,

is becoming insufficient. Further, according to FAO, 1.2 to 1.6 million tons of raw materials for

fish feed will be required in 2025 as an alternative to fish meal. Owing to this opportunity, small

but growing insect farming sector has captured major attention, investments, and strategic

developments in developed countries by some heavy weights in the animal feed business. For

instance, in 2017, the Cargill, Incorporated, U.S. based agriculture company and InnovaFeed,

French insect protein producer, entered in the partnership to market fish feed that includes insect

protein. Further, Europe based insect protein producer, Protix, opened its first commercial black

soldier fly larvae plant in the Netherlands in 2017 and planned to break ground on a second

facility in upcoming years with the $50 million aid from Buhler. Moreover, Canada based insect

protein firm, Enterra, has planned to expand the commercial-scale facilities in the North America



by 2023, with the financings from Calgary-based Avrio Capital and U.K.-based Wheat Sheaf. Thus,

growing expansion, investment, and strategic development in the developed economies offer a

great business opportunity for BSF stakeholders.

3.5. CHALLENGES 3.5.1. PRICING COMPETITION FROM PARENT INDUSTRIES BSF derived product faces the huge price competition from the plant-based ingredients. Most of

the plant-based ingredients are by-products created during the processing of plants such as

soybean, corn, and rapeseed that are produced in large quantities in parts of the world such as

North and South America and are cheaper than the insect meal. For example, soybean meal cost

around US$300 to $450 per ton. Thus, in terms of price and supply, the use of soybean meal

offers significant benefits. Also, it is widely used as an ingredient of feed for salmon and other

species, posing a major competition to the BSF products.

Further, chitin and its derivatives such as chitosan from crab and shrimp shell are continuing to

attract commercial development than the BSF derived chitin/chitosan, which is mainly due to the

fact that production of chitin and chitosan from insects is under research with very low production

in the world. Further, shrimp and crab shells-based chitin are majorly produced in various

countries of Asia, the region that offers low cost production capabilities. Hence, the price range

for chitin and its derivatives vary from $10 to $5,000 per kilogram. Due to this variation, BSF

chitin producer will be facing a challenge of positioning the product with respect to prices in chitin

and its derivatives market.

3.6. BSF DERIVED CHITIN AND CHITOSAN OPPORTUNITY ANALYSIS 3.6.1. BSF DERIVED CHITIN TRENDS Chitin and chitosan are another set of major products that can be derived from the BSFL. This

can be derived from exuviae of insects. Chitin and chitosan have contributed more than $5.0

billion revenue to the biopolymer industry in 2018. They have applications in broad range of

domains such as chemistry, pharmacy, phytosanitary, and industrial products. However, the

amount and the quality of chitin achieved from the BSF frass is very low for using it in the above-

mentioned domains for high end applications. Due to this, the acceptance of BSF derived chitin is

lower, which is one of the major reasons for lesser interest in this space from major market

players. In addition, high quality BSF chitin can only be extracted from complete unprocessed

whole dried larvae. Thus, manufacturers have to compromise on the production of protein meal

in order to produce the high-quality chitin that can be used for high end applications in various

industries.



In addition, the end users of this segment are more inclined towards the traditional chitin that

are produced from shrimp and crab shells. Thus, there is a direct competition from the existing

well-established chitin and chitosan market players and at present, the traditional sourced chitin

and chitosan market is irreplaceable with the BSF sourced chitin and chitosan. The selling price

of BSF derived chitin and chitosan may vary considerably according to chitin purity and indications

for use, i.e. from $10 to $1500 per kilogram.

FIGURE 10 SWOT ANALYSIS: BSF DERIVED CHITIN & CHISTOSAN INDUSTRY


Though there are limited market opportunities, some BSFL market players are working on creating

disruption in chitin and chitosan industry. For instance, in December 2018, South African based

AgriProtein Holdings Ltd, acquired Millibeter NV, a Belgian insect-based-ingredients company.

Millibeter had developed the technology to separate the chitin from the proteins and fats and to

convert this chitin into the various forms of chitosan in a sustainable way. However, in 2019,

SFly, France, remained the only noticeable manufacturer and the supplier of BSFL based chitosan

for the high-end industrial applications. According to SFly, the worldwide demand for this material

is rapidly growing as potential new applications are discovered virtually every day. Also, in 2016,

its overall demand was close to 3 times worldwide production capacities. This indicates that there

is a potential for BSF derived chitin and chitosan, but on a very limited scale. In addition, under

S W

O T

• Rising product demand in waste water treatment for eliminating impurities

• Increasing chitosan demand from the cosmetics industry

• Excellent chemical & physical properties such as bio-compatibility, biodegradability, non-toxicity, and adsorption

• Varying gross margin due to high pricing competition

• Non-standardized regulatory framework in the developing countries

STRENGTHS WEAKNESSES

• Strict regulations in North America over the plastic manufacturing

• Rapid growth of the large chitin and chitosan consuming geographies

OPPORTUNITIES

• Changing regulatory environment in developing nations for various industries

• Threat of substitutes from other cheaper alternatives

THREATS



some of the regulations, BSF derived chitin and chitosan are considered as the animal derived

biopolymer, which further act as positive factor for this segment.

FIGURE 11 COMMONLY SUGGESTED MARKET DISRUPTION STRATEGIES FOR BSF DERIVED CHITIN & CHITOSAN


Based on form, the BSF based chitin products can be divided into three categories, namely raw

chitin, processed chitin, and chitosan. Among these types, processed chitin and chitosan are the

prominent products amongst manufacturers and various end users.

3.7. REGULATORY ANALYSIS The legislation regarding the BSF is different in each region. In which, North America and Europe

have very strict regulations as compared to Asia-Pacific and rest of the world.

3.7.1. NORTH AMERICA In North America, U.S. Food and Drug Administration (FDA) and Canadian Food Inspection Agency

(CFIA) are working in the area of feed regulation. The FDA and CFIA identified seven insect species

currently reared in the union, including Hermetia Illucens, that fulfill the safety conditions-such

as these species should not be pathogenic or have any other adverse effect on the plant, animal

or human health; they should not be recognized as vectors of human, animal or plant pathogen;

and they should not be protected or defined as invasive alien species for insect production for

$

Right Target Industry

01

Promotions

02

Research & Development

03

Pricing

04

Target the industry which demand natural chitosan derived from biological systems for

food Preservation

Executing effective promotional campaigns

to educate right customer

Research on BSF based chitin and chitosan

consumption in various industries for varied

applications

Economic or competitive pricing

for high end application



farmed and pet animal feed. However, FDA and CFIA also placed restrictions on the substrates

fed to BSFL or these other species. The regulation states that the substrates must contain

“products of non-animal origin or a limited set of animal originated products” that includes

fishmeal, rendered fats, blood, and gelatin; and from non-ruminants, milk, eggs, honey, and

others. The flesh is not listed; and manure, “catering waste” (human food waste), and “other

waste” are explicitly excluded. These restrictions eliminate the risk of prion contamination of the

BSFL but greatly limit its usage to close nutrient loops. Thus, these regulations help to achieve

optimum quality of BSFL for the industrial application such as animal feed, agriculture, biofuel,

cosmetics, and others. However, this limits the BSFL producers to arrange and use specific raw

materials to culture and grow larvae, which may affect the production cost.

In the U.S., Food and Drug Administration (FDA) and the Association of American Feed Control

Officials (AAFCO) work together to regulate the BSFL production, packaging, labeling, distribution,

sale, import, and export for animal consumption. For instance, in August 2016, AAFCO approved

the dried larvae of Hermetia Illucens that has been raised on a feedstock composed exclusively

of feed grade materials for use in feeding salmonid fishes. In addition, in 2016, Canadian Food

Inspection Agency (CFIA), approved insect to use in salmonid and poultry feed in Canada.

Therefore, BSFL cannot be reared on non-feed grade substrates or fed to non-salmonids. In

addition, rearing BSFL on chicken manure and feeding them to fish or chickens or humans is not

allowed in the U.S.

In September 2018, the U.S. Food & Drug Administration has recommended the amendment of

the ingredient definition for dried black soldier fly larvae (BSFL) to use in poultry feed, according

to an announcement from EnviroFlight LLC. The amended definition allows the use of whole and

dried BSFL as the defatted and ground form of protein ingredient in poultry feed. Thus, the

increasing government amendment for BSF in the North America region is helping to grow the

demand for BSF from feed manufacturers.

3.7.2. EUROPE The use of insect protein in fish feed and pet food is allowed in the Europe. The next step will be

to authorize the use of insect protein in the poultry and other livestock. In July 2017, insect

protein from seven insect species were authorized in the Europe for use in aqua feed, opening

new feed markets for insect producers. Like other farmed animals, these insect species may only

be fed with feed grade materials. Also, pet food is a mainstream market for European insect

producers, and insect products are well suited to particular need of the pet food due to their

higher digestibility and palatability. Several European pet food companies already incorporate

insects in their feed formula, notably as a means to diversify their product range. In addition,



insect protein cannot be fed to poultry, only fishmeal is used. Yet, 78% of EU insect producers

see poultry feed as a promising opportunity.

FIGURE 12 EUROPE: REGULATORY APPROVAL FOR INSECT USE IN ANIMAL FEED, 2017

Source: IPIFF organization

The Government & Venik (Dutch Association of Insect Producers) permitted the use of products

such as insect lipid, proteins, and live larvae for piglet feed, pet food, and for egg-producing

chickens, respectively. Also, the regulations in the U.K. have authorized the use of insect proteins

originating from seven insect species (including BSF) in feed for aquaculture animals. The

feedstuff currently approved for these insects are pre-consumer agri-food residues known as

‘former food products’ including out of specification food; potato chips or breakfast cereals;

leftover dough and liquid chocolate; and surplus bread collected from retailers and bakeries. In

addition, oil/fats derived from these insects can legally be used in any livestock feed.

3.7.3. ASIA-PACIFIC The Asia-Pacific region is comprised of many different cultural groups, and the degree to which

they embraced entomophagy has been determined by dietary needs, cultural considerations, and

the availability of insects. In the countries of Southeast Asia and China, despite insects being bred

and prepared as a traditional food, there is little or no major regulation on the production and

application of insects in food and feed. For instance, in the Sabah province of Malaysia on the

island of Borneo, more than 60 species of insects are eaten. BSFL are one of these, eaten raw

along with locally brewed fermented beverage called tapai.

Vegetable Substrates

Unprocessed FormerFoodstuff: Dairy &Egg

Unprocessed FormerFoodstuff: Meat & Fish

Catering Waste & Slaughterhouse Products

Animal Manure

Feed Stocks Insect Production

Protein Fat Live

Target Species



In China and Australia, it is legal to feed poultry and fish with insects. Also, in China, the larval

feces can even be used as organic fertilizer in agriculture. Further, it is reported that the South

Korean government is also conscripting its own insect army to fight food waste. In Singapore, the

larvae have gotten the attention of the Singapore Food Agency (SFA), which has approved their

use as fish food. Thus, the non-standardized regulations and growing use of BSF as food and feed

ingredient in the Asia-Pacific region provides liberty to BSF manufacturers to promote and sell

products without any hindrance and complexity.

3.7.4. REST OF THE WORLD In the rest of the world, there is no standard rule on farming, safety, production, and marketing

of edible insects and insect-based products. If a clear set of rules regarding insects for food and

feed can be established, it will facilitate the sustainable growth of the insect business in this

region. However, for now, there are no clear rules and regulations on BSF.

In South Africa, black soldier fly is known to be produced on an industrial scale to feed all

monogastric animals such as chickens, pigs, fish and pet.



4. MARKET ANALYSIS

Black Soldier Fly (Hermetia illucens) is a revolutionary insect species that provides solution to

feed industry with an alternative meal source. Black Soldier Fly Larvae (BSFL) can grow on any

organic waste and convert the manure into high protein and lipids. As it is rich in protein (40-

44%) and lipid (7-36%), it is emerged as the cheaper protein alternative source for animal feed

applications. Moreover, high quality chitin can be derived from defatted BSF exoskeleton, which

is also one of the fastest growing (CAGR +19%) biopolymers. This chitin can be further processed

into a high-quality chitosan, which has potential applications in agriculture, pest-control, water

treatment, food preservation, textile, and others. Some of the leading companies in the BSF

market are researching on developing high-grade chitin and chitosan. Further, BSF is also helping

to solve world enigmas on managing food wastes (1.3 billion ton/ year: FAO, U.S.). Owing to this,

in 2018, the Governments from North America and Europe have approved the use of BSF derived

products for feed, agriculture, and pet food applications, thereby accelerating the growth of the

BSF industry.

In terms of value, the global BSF market is expected to reach $539.4 million by 2025, supported

by a CAGR of 30.6% during the forecast period. This market is mainly driven by increasing global

meat demand, growing aquaculture industry, increasing demand from animal feed industry for

alternative proteins due to rising prices of soy meal, growing government support for the use of

insect meal in livestock feed, and growing investments by key players in the BSF industry.

However, factors such as non-standardized regulatory framework across the Europe and limited

acceptance and approval for BSFL application in human diet are hindering the growth of this

market.

The global BSF market is mainly segmented by product type (protein meal, biofertilizer, whole

dried larvae, larvae oil, chitin/chitosan and other BSF products), application (animal feed,

agriculture, pet food, and other), and geography (North America, Europe, Asia-Pacific, and Rest

of World).



FIGURE 13 PROTEIN MEAL TO DOMINATE THE GLOBAL BLACK SOLDIER FLY MARKET DURING THE FORECAST PERIOD


Based on the product type, in terms of value, protein meal is estimated to command the largest

share of ~47% of the global black soldier fly market in 2019. This market is valued at an estimated

$51.1 million in 2019 and is poised to grow at a CAGR of 35.8% during the forecast period to

reach $320.0 million by 2025. The growth of this market is mainly attributed to the increasing

demand for protein meals from animal feed industry; increased fish meal and soy meal prices;

and government support and approval for an insect meal to be used in animal feed. However,

non- standardized regulatory framework in developed countries restricts the growth of the protein

meal market. Moreover, in terms of volume, biofertilizers market is estimated to command the

largest share of ~76.7% of the global black soldier fly market in 2019. This market is valued at

an estimated 167,954.1 tons in 2019 and is poised to grow at a CAGR of 18.0% during the

forecast period to reach 453,987.7 tons by 2025. The large share of this segment is mainly

attributed to the fact that large quantity of fertilizer is generated during the BSF processing

compared to protein meal and oil.

Protein Meal

$320.0million by

2025

$51.1 million in 2019

CAGR35.8%

METICULOUS RESEARCHESTIMATES

Whole Dried Larvae (Retail)

$93.5 million by

2025

$19.6million in 2019

CAGR29.8%



FIGURE 14 ANIMAL FEED APPLICATION TO DOMINATE THE GLOBAL BLACK SOLDIER FLY MARKET DURING THE FORECAST PERIOD


Based on application, in terms of value, the animal feed segment is estimated to command the

largest share of ~65.0% of the global black soldier fly market in 2019. This market is valued at

an estimated $70.7 million in 2019 and is poised to grow at a CAGR of ~35.0% during the forecast

period to reach $427.9 million by 2025. The growth of this market is mainly attributed to the

growing demand for meat products and subsequent increase in the demand for protein rich animal

feed; rising soy meal prices; and government approval for the BSF to be used as a feed ingredient.

Also, in terms of value, agriculture is expected to command the second largest share of ~23.0%

of the black soldier fly market in 2019. This market is valued at an estimated $25.0 million in

2019 and is poised to grow at a CAGR of 25.0% during the forecast period to reach $95.4 million

by 2025.

Animal Feed

$427.9million by

2025


CAGR35.0%

METICULOUS RESEARCHESTIMATES

Agriculture

$95.4 million by

2025


CAGR25.0%



FIGURE 15 GLOBAL BLACK SOLDIER FLY MARKET SHARE (2019) AND CAGR (2019-2025), BY GEOGRAPHY


Geographically, in terms of value, Asia-Pacific region is estimated to command the largest share

of ~50.0% of global black soldier fly market in 2019, followed by Europe (~22.0%), North

America (~16.0%), and Rest of World (~12.0%). The Asia Pacific market is estimated to be $54.3

million in 2019 and is poised to reach $243.3 million by 2025, at a CAGR of 28.4%. Moreover, in

terms of volume, Asia-Pacific region is also estimated to command the largest share of ~57.1%

of the global black soldier fly market in 2019. This market is estimated to be 124,477.9 tons in

2019 and is poised to reach 343,050.5 tons by 2025, at a CAGR of 18.4%. The growth of this

market is mainly attributed to the increasing consumption of meat and seafood, growing

aquaculture industry, rising awareness of BSF as an alternative protein source for the use in

animal feed, and increase in the prices of fish meal.

The key players operating in the global black soldier fly market are AgriProtein (South Africa),

Bioflytech (Spain), Enterra Feed Corporation (Canada), Entobel (Vietnam), Entofood (Malaysia),

Entomo Farm (France), EnviroFlight (U.S.), Hexafly (Ireland), F4F (Chile), Hermetia GmbH

(Germany), InnovaFeed (France), Protenga (Malaysia), and Protix (The Netherlands).

12.0%22.5%

ROW

22.0%34.5%

EUROPE

ASIA-PACIFIC

50.0%28.4%

16.0%34.9%

NORTH AMERICA

Market Share %

CAGR %



5. APPENDIX

5.1. QUESTIONNAIRE 1. Please validate the below information on market dynamics:

Table 1.1: Market Dynamics

Market Dynamics

Description Your Remarks

Drivers

x Increasing demand from animal feed industry for alternative proteins due to rising prices of soymeal

x Rising global meat demand

x Increasing government support for insect meal in livestock feed

x Growing global aquaculture industry

Restraints x Non-standardized regulatory framework across the Europe

x Limited acceptance and approval for BSFL application in human diet

Opportunities x Geographic expansion in emerging and developed countries

Challenges x Pricing Competition from Parent Industries

2. Please validate the below market segmentation:


Your remarks:

Global Black Soldier Fly Market

By Geography

North America

Europe

Asia-Pacific

Rest of the World

Protein Meal

Biofertilizers (Frass)

Whole Dried Larvae

Larvae Oil

Type

Chitin/ Chitosan

Animal Feed

Agriculture

Pet Food

Other Application

Applications

Other BSF Products



3. Please validate the global market size, forecast & methodology:

� Black Soldier Fly Market was around $xx million in 2018 and expected to

grow at a CAGR of around xx-xx% for the next 7 years

Your remarks:

4. Please comment on the contribution of the following segments to the overall BSF sale considering the BSF revenue break up of your company: Table 4.1: Black Soldier Fly Market, by Type

Product Market Share (%) in 2018

CAGR (%) Market Share (%) in 2018 (KOL’s Viewpoint)

Protein Meal

Biofertilizer (Frass)

Whole Dried Larvae

Larvae Oil

Chitin/Chitosan

Other BSF Products

Total 100%

5. Please comment on the contribution of the following applications to the overall BSF sale considering the BSF revenue break up of your company Table 5.1: Black Soldier Fly Market, by Application

Application Market Share (%) in 2018


Animal Feed

Agriculture

Pet Food

Other Application

Total 100%

6. Please comment on the contribution of the following geographies to the overall BSF sale considering the BSF revenue break up of your company: Table 6.1: Region-wise Value Market for Black Soldier Fly

Region Market Share (%) in 2018


North America xx% xx%



Europe xx% xx%

Asia-Pacific xx% xx%

Rest of the World xx% xx%

Total 100% 100%

Table 6.2: Country-wise Value Market for Black Soldier Fly

Region Market Share (%) in 2018


U.S.

Canada

Total North America 100%

The Netherlands

France

U.K.

Germany

Finland

Denmark

Belgium

Rest of Europe

Total Europe 100%

China

South Korea

Japan

Malaysia

Vietnam

Thailand

Rest of Asia-Pacific

Total Asia-Pacific 100%

Latin America 100%

Middle East & Africa 100%

Total 100%



5.2. AVAILABLE CUSTOMIZATION Country level analysis of Latin America, Pacific, and Middle East & African countries will be

customized as per your requirements.

Customization is available for the following countries:

x Pacific:

� Australia

� New Zealand

x Latin America:

� Brazil

� Mexico

� Argentina

� Venezuela

� Colombia

� Chile

x Middle East:

� United Arab Emirates (UAE)

� Qatar

� Saudi Arabia

x Africa:

� South Africa

� Nigeria



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Black Soldier Fly Market by Product Type (Protein Meal