Managing Feed Costs

May 04, 2022
It is no secret that feed costs have skyrocketed in the past year. Grain and commodity products have seen market prices rise. Corn has increased by over $2.35/Bu in six months. Soy products have risen by over $150/ton since October of last year. Fats are up 50%, mineral products up 30%, and on it goes. Costs of handling, delivering, and processing feed products also add to increased feed supplement costs.

Feed cost increases are made worse by supply chain shortages and logistical problems brought on by war, inflation, labor shortages, and government policies. These issues are out of the span of control of dairy and livestock producers. Worse yet there is no immediate end in sight to this problem.

Managing feed costs means controlling those things you do have control over. While you cannot control wild markets, foreign conflicts and poor political policy here are suggestions on how to maintain control over your feed costs:
  1. Manage shrink. How feed is handled and delivered affects shrink levels.  Any time a product is handled or moved there is shrink, it is unavoidable but can be controlled and reduced.  The use of upright bins with auger systems over flat storage can reduce shrink by from 3-7%. When dealing with a supplemental feed averaging $600/ton 5% shrink is the equivalent of a $30/ton savings! Bin systems will easily pay for themselves with in 22-24 months on most farms.
  2.   If you are already using an upright bin & auger system having an auger sock that drops down into the TMR mixer can reduce loss of feed due to wind. The dusts that you see flying away are likely the most expensive ingredients in the mix; vitamins, protein and expensive additives.
  3. Proper processing of grains fed can improve feed efficiency, thus reducing feeding cost. Corn used in dairy mixes should be ground to a 400–450-micron level to maximize starch utilization.  Animals fed properly processed corn will improve performance on the same pounds of grain fed or maintain performance on 5-10% less grain consumed. This is a significant economic opportunity if you are feeding corn that is not correctly processed.
  4. Not all feedstuffs are the same. Quality is important. Canola meal can run from 34-39% protein. Soybean meal can be from 44-48% protein. Do you know and are you confident that the feed stuffs you are buying are of good quality? Does your nutritionist know? Working with a feed supplier that has a sound Quality Assurance program can deliver solid economic results. Cheap feed is often the most expensive when it comes to performance. Cows love consistency, and cheap feed is seldom consistent.

Dairy feed costs make up approximately 50% of total production costs. Typically, concentrate fed in a dairy diet is 40-50% of total feed fed.  Forages also make up a significant part of the dairy ration expense.  These feed components also have a significant impact on production and health. Make sure that you are using good management to maximize the quality and nutrient value of these ration ingredients.  Use of a high quality forage inoculant, oxygen barrier bunker covers, and good forage handling and bunker management techniques are critical in controlling ration feed costs and animal performance.

There are many factors today driving the cost of your feed program up. Control the things you can to ensure economic success on your operation.  If you need help or have questions call your United Cooperative feed specialist for assistance.  You can RELY ON US to help with ideas to aid in controlling your feed costs.

Dan Jensema

Feed Marketing Manager


David Cramer

Filed Under: BeefCalvesDairyEquineFeed