Profitability of insect farms

Abstract

Despite growing interest from entrepreneurs, knowledge on the profitability of commercial-scale insect production is scarce. Insight into the economic figures of insect production is needed by farmers aiming to start insect farms, by banks seeking to provide financing, and by governments planning policy interventions. This review provides an overview of the profitability and underlying economic figures relating to the production of Hermetia illucens, Alphitobius diaperinus, Tenebrio molitor and Acheta domesticus. To enhance data interpretation, we also provide a brief overview of the global insect sector, with specific attention to farm-level operational practices. Sales prices refer to fresh larvae, dried larvae or larvae meal, whereas operational costs include costs for feed, labour, electricity, water and gas. Operational cost components differ per insect species, and therefore the relevant margins are specified for three insect species. The energy, feed, and labour margin for production of H. illucens ranges from € -798 to 15,576 per tonne of dried larvae. The feed and labour margin for production of T. molitor ranges from € 7,620 to 13,770 per tonne of fresh larvae. For production of A. domesticus the feed margin ranges from € 12,268 to 78,676 per tonne of larvae meal. The margin range for A. diaperinus cannot be estimated, due to a lack of data in the literature. The ranges mainly reflect the differences in sales prices, which are found to heavily depend on the geographical market location, type of market (feed or food) and quantity sold. Major operational costs include feed and labour, with feed costs varying substantially within and between insect species. The economic figures and margins presented in this article provide a foundation for the further development of the insect production sector.

Advancing edible insects as food and feed in a circular economy

“…Finally, the economics of insect production has until now scarcely been addressed. A first attempt has been made by Niyonsaba et al (2021) to shed more light on the profitability of insect farms.…”

“…Data on the profitability of commercial-scale insect production are scarce. Niyonsaba et al (2021) made a first attempt to obtain insight into the economics of insect production. They looked at four insect species: the black soldier fly, the yellow mealworm, the house cricket Acheta domesticus, and the lesser mealworm, though few data are available for the latter.…”

“…The prices and feed costs for house cricket meal are considerably higher than those for the black soldier fly and mealworms. This may be the reason that food and feed companies consider mealworms and black soldier fly more attractive to include in their products than crickets (Niyonsaba et al, 2021). This is because price is considered an obstacle in using insect products (Brynning et al, 2020).…”

“…The articles in this special issue cover a large range of topics related to the production chain of insects as food and feed. Currently there are three types of insect farms: (1) farms purchasing eggs or small larvae from a supplier and rearing them to the harvestable stage; (2) farms covering the entire production process, from eggs to dried insects; and (3) farms that cover both production and processing (fractionating the larvae into protein, fat, and chitin) (Niyonsaba et al, 2021). As the sector develops, parts of the value chain are expected to be dealt with by separate companies.…”

Introducing the special issue: ‘Advancement of insects as food and feed in a circular economy’

“…The final question is whether the insect industry is profitable. There are not many publications on this issue but in one article the question is addressed (Niyonsaba et al, 2021). In the final chapter (Van Huis et al, 2021) we try to give some perspective of the future for the industry.…”