Published in November 11, 2025 09:12 inAgribusiness

Pet and Commercial Animal Feed Market in Brazil 2025: M&A Opportunities and Strategic Partnerships

Introduction

Brazil’s animal nutrition market is experiencing a period of great significance and transformation. On one hand, the pet segment is expected to reach around R$77 billion in 2025, consolidating Brazil as the 3rd largest pet market globally (behind only the USA and China). On the other hand, the feed industry for livestock animals is projected to produce 94 million tons of feed this year, supporting one of the world’s largest herds and consuming about 60 million tons of corn and 20 million tons of soybean meal as inputs.

With this impressive scale and continuous growth (even if at a moderate pace), unique business opportunities are emerging. Many companies are seeking consolidation via mergers and acquisitions (M&A) and strategic partnerships to gain competitiveness and expand into the Brazilian market.

But why is this market so attractive and strategic in Brazil? Partly because the presence of animals is ubiquitous: there are around 160 million pets in Brazilian households and a gigantic population of production animals on farms. Thus, the feed sector becomes fundamental both in the emotional aspect (caring for pets as family members) and in the economic aspect (sustaining the productivity of agribusiness). This article aims to present an updated overview of the feed market, encompassing pets and commercial animals, highlighting trends, high-growth niches and success factors, as well as pointing out opportunities for investment, partnerships, and consolidation.

Throughout the text, we will discuss why entrepreneurs and investors should pay attention to this sector, including how to structure successful partnerships or acquisitions.

Brazilian Animal Feed Market Overview

To understand the opportunities, we must first size the Brazilian feed market in 2025. It can be divided into two large blocks: pet food (feed for pets) and feed for commercial animals (general livestock, mainly poultry, swine, cattle, fish, among others). Each has its own dynamics of growth, margins, and distribution, but both have gained prominence on the national scene.

Pet Market: Impelled by affection for companion animals, Brazil’s pet sector reached about R$75–77 billion in revenue in 2024 (a growth of 12.6% over 2023), with a slight increase expected for 2025 (~R$77.2 billion, +2.4% over 2024). Approximately 50% of this total comes from feed sales – around R$40–42 billion per year, highlighting that pet food is the flagship product in the pet market.

Historical growth was accelerated by pet humanization trends; during the pandemic, for example, many families increased spending on their animals, leading the pet food segment to double-digit annual growth. In 2025 that pace slowed due to inflation and weaker consumption, but sales levels remained high. Brazil is now the third largest pet market in the world and harbors a huge pet population (estimated at 150–160 million animals, averaging 1.8 to 2.2 animals per household), which guarantees a strong demand base.

Commercial Animal Feed Market: In agribusiness, the animal feed industry supplies poultry, swine, cattle, fish, pets and others. In 2024, this sector produced 91.1 million tons of feed, concentrates, and supplements, generating a financial turnover on the order of R$150–170 billion (considering the cost of ingredients used). For 2025, output is projected at 92–94 million tons (+2–3%), solidifying Brazil among the world’s largest producers of animal feed. This massive production is sustained by the country’s strong animal protein chain, Brazil is a leading exporter of chicken and beef, for example, and is concentrated in the South, Southeast, and Center-West regions, where the main intensive livestock hubs are located.

This segment is highly sensitive to input costs: corn and soybean meal together account for about 70% of feed formulation costs, which is why volatility in agricultural prices directly impacts margins. Even so, recent improvements (record grain harvests in 2023/24, for example) have helped stabilize costs and supported a return to growth in several sub-segments in 2025.

As we can see, both segments are attractive, though for different reasons. The pet market builds on value-added offerings and an emotional connection with end consumers, enabling higher prices and margins in specific niches (premium feed, functional snacks, etc.). In contrast, the livestock feed market is driven by volume and efficiency, acting as a cornerstone of the competitiveness of Brazilian agribusiness, any improvement in feed formulation or logistics costs can ripple through the entire chain of meat, milk, and eggs.

Segmentation: Pet Feed vs. Livestock Feed

A more granular analysis reveals important differences between the submarket of feed for pets and that of feed for production animals. These differences influence the investment opportunities and business models in each case. Below, we break down the market into Feed for Pets and Feed for Commercial Animals, comparing their profiles, trends, and opportunities.

Pet Food: Profile, Trends, and Distribution Channels

The pet food segment in Brazil is marked by a diversity of products and rising consumer (pet owner) demands. In recent years, there has been clear premiumization: dog and cat owners are seeking higher-quality feed with natural ingredients, organic formulations, grain-free recipes, or no artificial preservatives. This trend reflects a concern for pet health and well-being, as pets are increasingly seen as family members. Not surprisingly, so-called super premium foods, with high digestibility and supplemented with vitamins, chondroitin, omega-3, etc., are gaining market share, as are functional product lines (for example, special diets for weight control, oral care, coat health, hypoallergenic formulas, therapeutic diets for specific issues, etc.). Sustainability is also coming to the forefront: there are already feed options made with alternative ingredients (such as insect protein and organic vegetables) to serve owners worried about environmental impact.

Another characteristic of the pet market is segmentation by species and size. Companies offer specific formulas for dogs of different sizes and ages, feeds for indoor cats, feed for pet birds and rodents, among others. This evolution in the pet profile drives frequent new product launches and expands the range of products available.

Distribution Channels: The primary way pet owners purchase feed is through specialized stores (pet shops), there are thousands of small and medium pet shops across the country, in addition to large national chains and general retailers (supermarkets and agropecuárias, i.e. farm supply stores). However, the digital channel has gained enormous relevance: in 2024, pet e-commerce grew over 25% (around 27%) in Brazil, with online sales of feed and pet medications rising sharply.

Platforms such as virtual pet shop sites and marketplaces make it easy to compare prices and have products delivered to your door. Monthly subscription models are also on the rise, providing convenience and discounts for loyal customers, as well as recurring revenue for companies. This digital transformation forces manufacturers to adapt their strategies, partnering with marketplaces, establishing a presence on social media, using packaging suitable for delivery, etc., but it also opens space for new online entrants.

Competition and Brands: Brazil’s pet food market includes giant multinationals (Mars Petcare, Nestlé Purina, Royal Canin, Hill’s) alongside strong national brands (PremieRpet, Special Dog, Magnus, Fórmula Natural, among others) and numerous regional brands. Although the leaders hold a significant share, there is still fragmentation in niche segments and in local distribution, in other words, many small companies operating regionally, mainly with standard/economy products. This fragmented structure suggests potential for consolidation: acquisitions of smaller brands by large groups, or mergers that create companies with a broader portfolio.

From an investor’s perspective, the pet segment offers opportunities to add value through a strong brand, innovation, and marketing. Those who manage to launch a differentiated product or build a trusted brand tend to capture high margins and secure customer loyalty (given that pet owners are reluctant to change a food that works well for their animals). On the other hand, intense competition means new entrants need substantial capital for marketing and distribution – which is why partnerships (for example, with retail chains or tech companies to reach customers) can be so valuable.

In summary, the pet feed market in Brazil as of 2025 is dynamic and guided by trends in quality and convenience. Companies that innovate in product offerings (e.g. natural or functional diets), invest in digital channels, and build strong customer relationships are pulling ahead.

Livestock Feed: Volume, Scale, and Technical Differentiation

In the realm of feed for production animals, including mainly poultry (broilers and layers), swine, beef and dairy cattle, and aquaculture, the game is about high volume and cost efficiency. Brazil, as a major global producer of animal protein, sustains an enormous internal market to feed these herds. Broiler poultry is the segment that consumes the most feed: about 37–38 million tons annually projected for 2025, followed by swine (~22 million t). The cattle and dairy sectors also represent significant volumes: beef cattle (~7.7 million t), dairy cattle (~7.3 million t), and laying hens (~7.35 million t). Aquaculture, while still accounting for the smallest volume (~1.87 million tons in 2025), is growing consistently year after year, reflecting the expansion of fish farming (notably tilapia) and shrimp farming in the country.

In contrast to the pet market, where branding and product presentation are crucial, in commercial feed the important factors are technical and economic: adequate nutrition, price per ton, assured quality, and reliable supply. Often the buyer is an integrador agroindustrial (integrated agribusiness firm) or a cooperative, and not the end consumer, which makes it a B2B relationship.

Nonetheless, there is product differentiation: specific formulations for each stage of production (starter, grower, finisher, gestation, lactation, etc. for swine; phased rations for laying hens; feedlot rations for beef cattle, etc.), as well as premium feeds or concentrates that promise better feed conversion, and additives that add value (enzymes that improve digestion, probiotics for gut health, ingredients that enhance the quality of meat/milk/eggs, among others). For example, a meatpacking exporter might demand feed without antibiotic growth promoters to meet requirements of an overseas market, creating a niche for differentiated products. Similarly, high-performance dairy farmers may look for feeds with specific additives to boost productivity and reduce metabolic problems.

One critical factor is raw materials: as noted, corn and soybean meal compose the foundation of poultry and swine diets, which together represent almost 80% of the country’s feed production. This makes the sector vulnerable to price shocks in these inputs, as occurred in 2021 when smaller harvests and high demand drove up costs, squeezing margins. In 2024/25 there was some relief: Brazil’s grain harvest was record-breaking, and the average price of corn fell (though it rose again in early 2025, +15% in BRL, while soybean meal prices fell ~7%).

Successful companies in this field generally use commodity risk management strategies, such as hedging or vertical integration (some producers grow a portion of their own corn, for example). In addition, logistics weighs heavily: transporting corn from the Center-West to poultry or hog farms in the South/Southeast raises feed costs; therefore, feed mills tend to be located near major livestock production centers. Any logistic efficiency gains or distribution partnerships can be decisive in reducing the final cost.

It’s also worth noting the presence of major global players in Brazil’s animal nutrition market. Multinationals such as Cargill (Nutron), ADM, DSM, Evonik, De Heus, Alltech, and others operate primarily by supplying premixes, supplements, and additives to feed mills or producers.

Meanwhile, the production of complete feed can be carried out by cooperatives (for instance, many poultry and dairy co-ops have their own feed plants), by specialized national feed manufacturers, or by the integrated meat companies themselves (BRF, JBS, Seara produce internally a large portion of the feed consumed in their supply chains). This multitude of actors means the market remains relatively fragmented in certain regions and niches, opening space for strategic partnerships and acquisitions. For example, a company focused on additives could partner with a feed producer to develop a differentiated product line; or international groups might seek to acquire local firms to quickly gain a foothold in the Brazilian market.

Specific opportunities and challenges in this space:

Aquaculture: Many see huge potential here. Brazil has the conditions to become a leader in tropical fish farming, and that will require specialized feeds (with higher protein content, marine-based ingredients or alternatives like insect protein, good water stability, etc.).
Beef cattle: The trend of increased feedlot finishing (animals fed in troughs at the end of the production cycle) is creating demand for high-energy rations and specialized feed concentrates.
Swine and poultry: The continuous drive for efficiency keeps these sectors in ongoing technological evolution, whether via genetic improvement or precision nutrition. This creates opportunities for “tailor-made” feeds – formulated with software that adjusts nutrient levels daily, using barn sensors and other data-driven tools.
Value-added service: Companies that combine technical know-how (specialist veterinarians and animal nutritionists on staff) with their feed products tend to have an advantage, because they’re not just selling a bag of feed but also providing an added service (e.g. nutritional consulting for the client).

In short, the feed market for commercial animals is robust and essential to agribusiness, focused on scale, cost, and nutritional science. The business opportunities lie in introducing innovations that improve productivity or cater to new niches, and in consolidating operations to gain production/distribution scale. In the next section, we will discuss the factors that make this market attractive for mergers, acquisitions, and partnerships, given its current state of fragmentation and need for efficiency gains.

Key Drivers for M&A and Partnerships in the Sector

Both the pet market and the production animal nutrition market have characteristics that favor mergers, acquisitions, and strategic partnerships. Below, we highlight the main drivers that make this sector attractive for consolidation, as well as the typical synergies obtained in M&A deals:

Fragmentation of the market: Despite the presence of large companies, the feed sector is still relatively fragmented, especially in certain niches and regions. In pet retail, for example, small and medium enterprises account for almost half of sales in physical stores. In commercial animal nutrition, there are dozens of independent manufacturers and cooperatives serving local markets. This fragmentation opens the door for consolidation. Mergers and acquisitions can unite complementary players, eliminate redundancies, and create larger, more efficient companies. Investors see in this the chance to gain market share quickly.
Supply chain integration and scale: Integrating the supply chain is another important driver. Larger companies can negotiate better input prices (corn, soy, vitamins) due to bigger volumes, and optimize the logistics of distribution (streamlining routes, filling transport capacity, negotiating freight costs). Thus, M&A in the feed sector often aims for scale gains: by acquiring competitors or partners, the combined company can significantly reduce unit costs. In a market where margins can be tight, even a 1–2% reduction in production or freight cost can mean a large competitive advantage. Additionally, vertical partnerships (for example, between a feed producer and a large livestock farmer or cooperative) can ensure stable supply and market outlets, benefiting both sides.
Brand and product portfolio: In the pet segment especially, established brands carry high value. An acquisition can bring a strong brand into the buyer’s portfolio, expanding its presence in a particular niche (e.g. a multinational acquiring a local organic feed brand to enter that segment). Additionally, combining product portfolios allows a company to offer a more complete mix, attracting distributors and customers who prefer “one-stop-shop” suppliers. Product differentiation – patented formulas, secret recipes, veterinary lines – also adds value in a transaction. For this reason, innovative companies that have know-how or exclusive products (e.g. a startup with natural additive technology) become attractive targets for acquisition or partnership.
Quality and certifications: Assured quality is fundamental in animal nutrition. Companies with sanitary and management certifications (BPF – Boas Práticas de Fabricação (Brazilian Good Manufacturing Practices), ISO 22000, organic certifications, GMP+ etc.) have a head start, as they guarantee reliability to customers and open doors for export. In this sense, acquisitions may occur to incorporate quality control capabilities or to meet specific market requirements. For example, if a company does not yet have certification to export pet food to a strict European market, it might opt to merge with another that already has that approval, rather than starting from scratch. Likewise, partnerships between companies can be motivated by complementarity in compliance, one has the proper manufacturing plant, another has a license for some special ingredient; together they manage to launch a product that neither could produce alone.
Sales channels and distribution: Expanding or improving distribution channels is another attractive factor. A regional feed manufacturer might seek partnership with a retail chain to gain privileged access to consumers, or conversely, a retail chain might acquire a supplier to vertically integrate and improve margins. In many agribusinesses M&A cases, we see vertical integration: input producers, feed manufacturers, distributors and farms combining to capture more value along the chain. On the horizontal side (acquiring direct competitors), the motivation may be to enter a new geographic market, for example, a company from the Southeast acquiring another in the Northeast to capitalize on pet market growth there, or to eliminate competition by enlarging its customer base.

In addition to the points above, the broader macroeconomic context can also influence M&A strategies in the sector.

In summary, the appeal of the feed sector for M&A lies in the possibility of combining scale + brand + innovation + efficiency, creating companies that are more globally competitive. Naturally, not everything is a clear win; one must also evaluate the challenges and risks involved, which is the subject of the next section.

High-Potential Areas for Business and Partnerships

Within this broad market, some specific areas stand out with high growth potential and deserve special attention from investors and entrepreneurs in 2025 and the coming years. Whether due to accelerated demand growth, attractive margins, or still-underserved gaps, strategic niches and opportunities include:

Premium pet food: The premium and super premium niche for dog and cat food continues to expand rapidly (some estimates project ~10–19% CAGR globally in the next decade). Products in this category, with high-quality proteins, selected ingredients, no by-products, achieve high margins and attract consumers willing to pay more for quality. In Brazil, as the income of a segment of pet lovers rises and pet humanization remains strong, we see room for domestic premium brands to grow and for global brands to enter via partnerships. For an investor, this segment offers a high average ticket (higher spend per customer) and strong loyalty but requires heavy investment in marketing and selective distribution (being present in high-end pet shops, vet clinics, etc.).
Organic and functional pet diets: Aligned to the pursuit of healthy living, organic certified feeds (made with organic, pesticide-free ingredients) and functional diets for pets are emerging in Brazil – the latter being feeds with added components that provide specific benefits (prebiotics for digestion, chondroprotectors for joints, natural antioxidants for immunity, etc.). Although they still represent a small slice (less than 1% of revenue, according to Abinpet), these sub-niches are growing quickly as a segment of “super premium” owners seek the best for their pets. Brazil already has some natural/organic product lines, but many are often imported or produced in limited volumes. There is an opportunity for local startups to launch organic products at competitive prices, as well as for partnerships with organic farms to secure ingredient supply. As a nascent market, strategic partnerships can accelerate its development and consolidation.
Feed for exotic pets and aquaculture: Beyond the dogs-cats-cattle axis, there are segments that are underserved yet growing strongly. One example is aquaculture: Brazilian aquaculture (farmed fish and shrimp) has been growing ~5–7% per year, and it drives demand for specialized feeds. In 2025, feed consumption by aquaculture is expected to reach 1.87 million tons, but this number could multiply if the country taps its aquaculture potential. Investing in fish feed mills (with differentiated extruders, etc.) or partnerships with fish producers to develop tailored formulations can yield significant results, including products aimed at export (high-quality feed for premium species). Meanwhile, exotic pets like ornamental birds, small mammals (rabbits, hamsters), reptiles and aquarium fish also represent niches to explore. For example, the keeping of ornamental birds and fish grows ~2–3% annually, boosting sales of specific foods (feed for cockatiels, parrots, aquarium fish, etc.). While these niches are smaller in value, they can be profitable and face little competition – ideal for small companies or spin-offs of larger firms that want to serve these specialized demands.
Feeds tailored by species or production stage (livestock): In the livestock feed arena, customized, higher value-added solutions stand out. This includes, for example, special feeds for breeding sows (which improve litter productivity), finishing rations for free-range chickens (serving the organic or caipira chicken niche with natural ingredients), or precision diets for feedlot cattle (adjusted via software to optimize weight gain and reduce methane emissions). These products can often command a price premium if they demonstrate superior performance. Companies focused on a technical niche can differentiate themselves relative to the big players. Thus, business opportunities exist in developing “premium” lines even within the mass livestock feed market, whether via in-house R&D or in partnership with research institutions and universities (for example, creating a dairy cattle feed with a supplement that raises milk solids content, adding value for the producer). In a huge market, even niches of 1–2% can represent millions in revenue.
Nutritional supplements and tech additives: Demand is also growing for products that complement feed, such as vitamin premixes, mineral concentrates, and additives (enzymes, probiotics, essential oils) that can be added to animal diets to improve performance or health. This is a sector of its own but closely linked to feed. Partnerships between animal nutrition companies and tech startups are promising here: for example, a biotech company developing enzymes that increase fiber digestion could partner with a feed manufacturer to incorporate that innovation into formulas. Or a startup producing insect protein at scale (there are already Brazilian companies doing this) could supply a sustainable ingredient for new feed lines. Brazil has a growing ecosystem of agri-techs and “pet-techs,” and connecting them with established companies via partnerships or investment can generate novel products and competitive advantage. Those who lead in trends like functional nutrition for pets or precision feeding in livestock will reap significant results.

In addition to product niches, it’s important to highlight possible forms of strategic partnership in the sector. Some configurations that have proven effective include:

Feed manufacturer + distributor/retailer: A partnership between the producer and the player with direct consumer access, guaranteeing preferential sales channels. Example: a manufacturer strikes a deal with a major pet shop chain to develop an exclusive feed line under the retailer’s own brand, the retailer gains a unique product, and the manufacturer secures volume.
Vertical partnership (inputs + feed + technical service): Integration of different links: an ingredient or premix supplier joins with a feed producer and a veterinary technical service company to offer a complete package to the livestock farmer. Thus, the client receives the formulated feed, technical usage recommendations, and perhaps even a specialty ingredient, all from a coordinated source,increasing loyalty and value-added.
Alliance between local and global brands: Many multinationals seek to enter or expand in Brazil, and they can do so via partnerships with local firms. For example, a Brazilian company might license a foreign super premium pet food brand to produce and/or distribute it domestically, combining international prestige with local market knowledge. Or joint ventures where the international partner brings capital and technology, and the local partner brings the factory and established sales network.
Joint ventures focused on technology: As mentioned, uniting traditional companies with startups or research centers can be highly strategic. A joint R&D lab can be created to develop new formulas, or a farm software startup can partner with a feed company to integrate a customized diet formulation service via an app. With the digital transformation in agriculture, such partnerships bring innovation that would be costly to develop independently.

In sum, the business opportunities in the feed market involve both identifying high-growth product niches and orchestrating partnerships and acquisitions that leverage competitive advantages. Each company must evaluate where it has strengths and where it seeks complementarity (be it in portfolio, technology, or market access) and pursue those growth strategies.

Challenges and Risks to Consider

Investing in or consolidating businesses in the feed sector is not without its hurdles. Entrepreneurs and investors need to be aware of the inherent challenges and risks, and plan mitigating measures. Below we list the main points of attention:

Regulatory and sanitary barriers: Feed manufacturing in Brazil is heavily regulated by the Ministry of Agriculture (MAPA). One must comply with rules for facility registration, product registration, labeling, ingredient limits (e.g. prohibition of certain growth promoters, salmonella control, etc.). For new entrants, the barriers to entry can be significant in terms of bureaucracy and required certifications. Additionally, to export feed or ingredients there are international sanitary barriers, for example, some importing countries demand certification that products are free of certain diseases or only accept suppliers on approved lists. This favors those already in compliance but poses a challenge for acquisitions (it’s critical to conduct due diligence to verify if the target company meets requirements, holds licenses up to date, or has any hidden environmental or sanitary liabilities, etc.).
High tax burden: A critical point especially in the pet segment is the tax load. In Brazil, pet food is considered a non-essential product by tax law, and thus bears a very heavy tax burden – it’s estimated that for every R$1 spent on pet food, about R$0.40–0.50 goes to taxes, far above the international average (in the US it’s ~6–8%, in the EU ~10–25%). This makes the final product more expensive and reduces margins for both the manufacturer and the retailer, in addition to discouraging consumption in tighter economic times. Changes in taxation (such as the Tax Reform expected to take effect in the coming years) could alter this scenario, but for now it’s a risk companies need to manage. In the case of agricultural feeds, there are tax exemptions in some states and special regimes, but the fiscal complexity remains an operational challenge.
Volatile input prices: As discussed, the sector depends on commodities whose prices swing with harvests, climate, and global markets. Supply shocks (droughts, pests) or exchange rate fluctuations (a strong dollar makes imported vitamins and premixes more expensive, for instance) can quickly erode profitability. A related risk is unpredictability in cost pass-through: if competition is high, it may not be possible to pass raw material price increases on to the feed price, squeezing margins. To mitigate this, companies need financial strategies (hedging, forward contracts) and formulation flexibility (substituting ingredients with cheaper equivalents when possible). Even so, investors should analyze how sensitive a business’s margins are to corn/soy price changes in any project or acquisition.
Intense competition and established players: Entering the market means facing both cash-rich multinationals and well-entrenched local brands. Brand loyalty in pet food can be strong, pet owners hesitate to change their pet’s diet without good reason, which makes winning customers difficult. In production feed, many integrators have long-term contracts with suppliers or in-house production, leaving little room for new suppliers unless they offer a very differentiated value proposition or aggressive pricing. Therefore, competitive risk is high. Acquisitions can help circumvent this (buy a competitor instead of fighting it out), but here another risk arises: overpaying for an M&A deal based on market prospects, and then not being able to extract the projected synergies, making the investment less profitable. It’s essential to perform realistic valuations and commercial due diligence to understand the competitive dynamics before closing a deal.
Post-merger integration and cultural differences: If one opts for an acquisition or merger, the process of integrating the companies is challenging. Often, the target company has its own organizational culture and distinct processes and systems. Unifying sales teams, logistics networks and even branding (deciding whether to keep separate brands or merge them) requires planning and tact. In agribusiness specifically, there are logistical risks, integrating different plants and distribution channels without losing customers in the process. There’s also the risk of losing key talent: in family-owned companies, for example, the departure of the former owners can destabilize relationships with suppliers and clients if proper retention isn’t in place. In short, poorly executed integration can make 1+1 end up less than 2, undermining the expected synergies.
Need for continuous innovation: In the long run, a threat for any animal nutrition company is becoming obsolete. New ingredients, new requirements (such as regulatory bans on certain additives), and shifting consumer trends (sustainability, “grain-free” products, etc.) all demand constant R&D investment. A company that doesn’t innovate may find itself selling a commoditized, low-margin product while the market moves toward more advanced options. Therefore, when evaluating a business, one should consider its innovation pipeline, partnerships with universities, presence of a qualified technical team (veterinarians, nutritionists), and the company’s ability to adapt to trends. Lacking these is a strategic risk.
Other risks: We could also mention the risk of animal health crises, e.g. an outbreak of avian flu or swine fever can suddenly cut feed demand in a segment, as almost happened with Brazil’s chicken exports in 2025, and macroeconomic risks (a drop in income reduces pet spending or leads to lighter cattle at finish, etc.). These uncertainties are part of the landscape and reinforce the importance of diversification within a portfolio (operating in multiple segments can cushion impacts, since it’s unlikely all would be affected by a crisis at the same time).

Despite these challenges, good management practices and planning can mitigate the risks. For example, in post-M&A integration, thorough due diligence and a detailed integration plan, including cultural change management, are essential (Silveira Capital supports its clients precisely in this preparation, ensuring that the synergies mapped out on paper come to fruition in reality). On the regulatory front, maintaining an up-to-date compliance department and relationships with regulators helps anticipate changes and avoid surprises. On the innovation and competitiveness side, investing in partnerships (with startups, institutes) can bring agility and prevent the company from falling behind.

Being aware of these risks is important for making an informed decision. In the next section, we present a brief guide on how to structure partnerships or acquisitions successfully in the feed sector, covering everything from due diligence to possible business models.

How to Structure a Successful Partnership or Acquisition

Entering the feed market, whether via acquisition of an existing company, merger, or strategic partnership, requires careful planning and professional execution. Below, we present a checklist of due diligence and essential steps to structure a successful deal, as well as common partnership models and key metrics to monitor during the process. Finally, we comment on how Silveira Capital can assist as a facilitator.

Due Diligence Checklist: Before any investment or partnership, it is crucial to conduct a comprehensive analysis of the target company or partner. Aspects to verify include:

Market and competitive position: Evaluate the company’s market share in its segment/region, the growth of the market where it operates, and the barriers to entry. Understand who its main competitors are and its differentiators. (Example: Is the company a leader in fish feed in the Northeast? Is the local market growing above the national average? Does that support the investment thesis?)
Product portfolio and innovation: Review the quality and breadth of the products. Do they meet current trends (e.g. grain-free line, medicated feeds, supplements)? Is there a pipeline of new products? Also check formulations, patents, dependence on any critical input. (Example: How differentiated is the feed the company produces or is it basically a commodity? Does it have any patent or proprietary recipe?)
Sales channels and distribution: Map out how the products reach the customer. Direct sales? Distributors? E-commerce? What is the geographic reach and logistics efficiency? A company might have an excellent product but weak distribution – identifying this allows you to plan improvements. Evaluate existing contracts with distributors or large clients as well.
Brand reputation and customer base: Check how customers and the market perceive the company. Is the brand well regarded? Are there recurring complaints (quality, delays)? And what about the client base, is it diversified or concentrated? (Example: If 50% of sales are to a single integrator, there’s a concentration risk.) Customer loyalty, repurchase rates, etc., also come into play.
Compliance and legal aspects: Confirm whether the company is in good standing (registered with MAPA, holds environmental, labor, sanitary licenses). Identify any hidden liabilities: lawsuits, tax debts, regulatory issues that could lead to fines or business interruptions. Compliance is vital to avoid post-deal surprises.
Quality certifications: List relevant certifications the company holds (ISO, BPF, organic, GMP+, etc.). This indicates how prepared it is for demanding markets. If it lacks some, evaluate the effort required to obtain them if they are of strategic interest.
Supply chain: Understand where the raw materials come from (corn, soy, meat products, additives). Are there long-term contracts? Dependence on few suppliers? Currency risk (imported inputs)? What are average inventory levels and purchasing policies? A financial due diligence should cover inventory and working capital, since buying grains ties up a lot of cash.
Production capacity and facilities: Visit factories, check for idle capacity or expansion needs. Note the state of equipment (modern vs obsolete), automation levels, etc. This impacts how much additional investment will be needed post-acquisition. Also check location and the possibility of logistical gains by integrating with other units.
Financials and margins: Finally, perform a thorough financial analysis: revenues, historical growth, gross and EBITDA margins, debt, cash flow, working capital needs. Unit economics (e.g. margin per ton of feed sold) help reveal if the business is efficient. If it’s a minority partnership, these figures help project returns; if an acquisition, they feed into the valuation.
Culture and people: Cultural compatibility between companies is one of the biggest determinants of post-M&A success, but often neglected in analyses. Differences in values, management style or level of autonomy can cause internal conflicts and loss of key talent. Assess the organizational culture, internal climate, and leadership motivation to anticipate integration challenges and plan retention and alignment strategies from the outset.
Operations and processes: Understand how the target company operates in practice, from production through logistics, this is essential for evaluating risks, synergies, and integration costs. Map critical processes, automation levels, systems used, bottlenecks and best practices; this identifies where real efficiency gains will be achieved or where investment will be needed. The current operations need to be compatible or complementary to those of the acquirer for the merger to add value.

This checklist is not exhaustive, but it covers the main pillars. The help of consultants experienced in agribusiness M&A is advisable to conduct this diligence, specific issues such as nutritional quality, sanitary risks and agribusiness strategy call for a specialized eye.

Deal structuring in the feed sector can follow different models, such as full acquisitions (with complete control of the operation), minority stakes with (or without) an option to buy (which allow the partners to “test” the relationship), or joint ventures/specific commercial partnerships. Each format requires strategic alignment and well-defined contracts to ensure balance and governance. During the evaluation and post-deal phases, metrics like CAC, churn, growth, gross margin, market share, and productivity help measure the success of integration. The key to successful partnerships is clarity of objectives, alignment between the parties, and rigorous monitoring of results.

Silveira Capital serves as an advisor and facilitator for M&A in animal feed sector, assisting from the identification of opportunities, conducting due diligence, and financial modeling, to negotiation and closing the deal. With experience since 2016 in agribusiness and an extensive network of contacts, our team helps structure transactions so that both buyers and sellers/exiting partners achieve maximum value and security. Additionally, we support the post-deal phase, guiding integration and any necessary working capital or expansion funding.

In summary, preparation and follow-through are the keys to success in a partnership or acquisition. By engaging an experienced advisor, following a rigorous checklist, choosing the appropriate model, and focusing on the right metrics, the chances of an M&A transaction in the feed market delivering positive results increase exponentially.

Conclusion

In 2025, the feed market for pets and commercial animals has solidified itself as a pillar of both retail and the Brazilian agribusiness. As we have seen throughout this article, even with challenges like inflation and a moderate economic slowdown tempering growth, the sector has solid fundamentals and numerous business opportunities. Summarizing the main points:

Sector Overview: The pet market is robust (around R$77 billion per year) and the livestock nutrition market is enormous (94 million tons of feed), both with favorable long-term trends, supported by people treating pets like family, global demand for animal protein, innovation in nutrition, etc.
Key Segment Differences: In the pet segment, opportunities stand out in premium products, natural diets, and expanding digital channels; in the commercial segment, the focus is on efficiency, specialization (e.g. aquaculture) and providing complete solutions to producers.
Drivers for M&A and Partnerships: These include market fragmentation (many companies to consolidate), logistics scale gains, the pursuit of technology/innovation, and market expansion. Several deals are already happening along these lines, and the expectation is for an acceleration of this consolidation.
High-Growth Niches: Premium and organic pet foods, specialized feeds for fish and other niches, supplements and additives,all showing above-average growth and attractive margins, especially when combined with strategic partnerships that amplify their reach.
Caution for Investors: We emphasized regulatory, tax, competitive, and integration risks, indicating that careful evaluation and mitigation (via due diligence, compliance, integration planning) are indispensable for success.
Deal Structuring: We provided a practical guide on how to conduct an acquisition or partnership, from analyzing the market, product, and channels to choosing business models (JV, partial/total acquisition) and metrics to track performance. With the right tools, it’s possible to turn planned synergies into reality and avoid unpleasant surprises.

Looking to 2026 and beyond, the expectation is for a sector that is even more innovative, sustainable, and integrated. Trends such as functional and personalized pet diets, the use of alternative ingredients (insects, algae) to reduce the environmental footprint of feed, and the adoption of precision technologies in production animal nutrition (monitoring feed intake via IoT, real-time formulation algorithms) should gain momentum. These trends open new horizons for agile and well-capitalized companies. Estimates indicate that the Brazilian pet products market could exceed R$80 billion in 2026, and on the animal nutrition side, Brazil will continue chasing production records to sustain its protein leadership. In other words, there is plenty of room to grow and profit, but also the need to invest, innovate and, often, join forces to capture all that potential.

If you, the reader, are considering entering this feed sector or seeking strategic partnerships, now is the right time to act. The market’s consolidation and professionalization are already underway, and those who move early will reap the best results. Get in touch with the Silveira Capital team to explore synergies and opportunities tailored to your situation – as an independent financial advisor, we can help you find the ideal partner, structure the acquisition you’re aiming for, or even design the best strategy for organic growth and M&A in the animal nutrition agribusiness.

The future of animal nutrition in Brazil is promising, guided by quality, animal health and sustainability. With planning and well-structured partnerships, entrepreneurs and investors will be able not only to follow the trends but to lead them, building successful businesses and contributing to a feed sector that is ever stronger and more innovative.

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About the Author

Jéferson Silveira Martins is a specialist in mergers and acquisitions (M&A), business development, and investment fundraising in the agronegócio (agribusiness) and mining sectors. As the founder of Silveira Capital, he leads strategic transactions, connecting investors to solid opportunities.

Learn more about Jéferson Silveira Martins and his journey here: Biografia Jéferson Silveira Martins

This article is provided for informational purposes only and does not constitute legal, financial, or investment advice. Before making any investment or divestment decision, consult qualified professionals. The opinions expressed in this article are the author’s and do not necessarily reflect those of Silveira Capital or its affiliates.