Nutreco highlighted the "challenging times" confronting the livestock industry as it revealed better-than-expected quarterly revenues - boosted by a succession of double-digit increases in feed prices.

The Dutch-based group, which sells feed in 80 countries, said that prices of feed sold by its Canadian division rose by an average of 14.7% in the July-to-September period, compared with the same quarter a year before, "due to higher raw material prices".

Values of corn and soybeans, major feed components, reached record highs during the quarter, with wheat too at historically elevated levels.

However, by volume, Nutreco's sales in Canada eased by 1.1%, as many livestock farmers cut herds in the face of rising prices, with reports of reductions by small operators as well as large-scale hog producers such as Blue Sky Farms and Puratone.

"The decline in volume is caused by a slight decline in feed for swine and beef, partly compensated for by growth in feed for dairy cows," Nutreco said.

For Canadian beef farmers, high feed prices have represented a fresh setback to a sector which had been recovering from a liquidation wave sparked by the discovery of BSE nine years ago.

Canada's beef cow inventory, at 3.96m head as of July 1, was 0.1% higher than a year before – if down 27% on the 2005 number.

'Smaller herd sizes'

In global compound feed, Nutreco revealed average price increases of 12.5% in the latest quarter,  rises which had met with a 6.3% drop in volumes.

"The operating result in the quarter was lower than in the same quarter last year due to smaller herd sizes, especially in Iberian and white swine," the group said.

"The livestock population in Spain declined slightly compared with last year."

The Spanish financial crisis is forecast by US Department of Agriculture staff in Madrid to cut Spanish beef consumption by 7,000 tonnes this year, to 583,000 tonnes, with a similar drop forecast for 2013.

However, Spain's pig farmers faced more buoyant demand, thanks to Chinese imports, the USDA officials said, forecasting continued rises in pig production.

'Tough economic conditions'

Factoring in currency factors too, and a small rise in prices of premix feed, overall animal feed revenues rose 7.4% to E855.4m for the quarter, Nutreco said.

"Our animal nutrition business saw higher revenues due to price effects," Knut Nesse, the Nutreco chief executive, said.

This rise was behind the growth of 21% to E624.7m in revenues to the fish feed division, growth helped by the acquisition of the Shihai fish and shrimp feed business in China.

Mr Nesse said that he was "satisfied with the overall results in the face of tough economic conditions and against a background of higher raw material prices affecting our customers".

The revenue figure was marginally above market expectations. Nutreco shares edged 0.9% higher to E58.70 in Amsterdam.