In today’s economic environment, everyone looks for ways to drive out the cost of doing business. The price of all our inputs, whether feed-, agronomy- or energy-related, all add up to big dollars at the end of the year. As inflation has hit all our businesses, these dollars seem to become bigger and bigger, and the importance of managing these dollars becomes more real daily.  

When evaluating Best Cost Solutions, it is crucial to make sure that your evaluations are based on what is absorbed by the animal. The following are key factors that affect your farming operations’ bottom line. Here is a list of items to evaluate when considering Best Cost Solutions:
 

1. Shrink:  The amount of feed delivered to the farm is not necessarily the amount of feed the animal receives. Most farms today have a 3%- 10% shrink from the amount of feed delivered to the farm and what gets fed to the animal. If the average protein mix cost today is $636/ton, then the cost of the shrink is $19 to $63/ton.  

Ways to Reduce Shrink on the farm: 

• Key management strategies would include using enclosed facilities verse open bay commodity sheds. Studies have identified that on-farm shrinks on grain and protein ingredients stored in open bays are in the 5 to 15% range. These are important to control as they don’t do anybody any good if the feed is blowing away in the wind. Bulk bins usually reduce shrink to the 2 to 4% range if managed correctly. 
• Using a metered mechanism to deliver the feed into a TMR verse a large payloader bucket is another keyway to controlling shrink. It takes a lot of effort to get to accurate numbers using a payloader bucket verse an auger as an example. The feed may have gone into the TMR mixer, but the overages may not increase animal production.
• Rotation of ingredients on the farm. The feed stored outside and exposed to the weather elements never gets better with age. Animals do the best with fresh feeds that get rotated regularly.  

 

2. Quality:  The feed fed to your animals may not be the feed your animals actually digest. Here are some examples of this:
   1. Blood meal quality can vary a lot in quality and digestibility. If a poor-quality blood meal is 10% less digestible than a high-quality blood meal, that would be a value of $90 to $150/ton depending on the cost of the blood meal. Just calling around for the price of blood meal does not tell the story, and people sometimes pay way more than what it is worth.
   2. The quality of corn processing can also vary a lot. The difference between 400 and 600-micron corn may not be visible to an average person, but it is between 1 and 2 pounds of milk per day to the cow, which can be $.18 to $.40 per cow per day.
   3. Quality of fat products and micronutrients is also vital between suppliers and how animals respond with milk production or the health of the animal.

 

3. Service:  If the feed does not arrive on time or not at all, it is pretty hard to have a consistent ration going into the animal. With the challenges of logistics and labor today, this is becoming a big issue. Is your feed showing up at a time convenient for you, or are trucks showing up at all hours of the day?

United Cooperative’s feed division aims to offer ways to control feed shrink and deliver a quality product on time that can be absorbed appropriately by your livestock based on our Quality standards. These are the best ways to get the most out of your feed purchases. Sometimes cheap can be very costly. If you have any questions on these issues, please feel free to reach out and talk to one of our Feed Specialists.