Today, all producers must look deep into their businesses to minimize the red ink and, hopefully, move into the black.
Of course, keeping detailed records is a must, and now their usefulness is even more critical to evaluate options and make sound business decisions. Still, even when it seems you’ve done all that you can, management can often be tightened up and efficiencies made to squeeze out a bit more output or costs.
When a business is making substantial profits productivity can slip and the financial consequences are not too great or easily noticed. “However, given the cyclical nature of pork production, it is vital at all times that we don’t ‘take our foot off the gas,’ but instead, continue to operate the business at maximum efficiency,” according to Noel Williams and Casey Neill, with PIC North America. “In a downturn, all businesses suffer — but to a greater or lesser degree.”
Certainly, profit made in good times and wisely invested can be accessed in a downturn to keep the business afloat. “It’s very tempting to use profits to expand the business when things are going great,” the duo notes. No question, that’s what many U.S. pork producers did in the last dramatic and extended profit cycle.
While using profits to increase sow numbers may mean bigger profits in the good times, it also means bigger losses in the bad times, which is what the U.S. pork industry has been facing now for more than two years.
The key then is to accelerate unit efficiencies. Williams and Neill point to sensitivity analysis, which can highlight the business’ key areas that have the greatest influence on output. An improvement of 0.1 units in wean-to-finish feed-conversion rate reduces the whole-herd feed-conversion rate by 0.08. Reducing wean-to-finish mortality so that pigs sold per sow per year increases by one also reduces the whole-herd feed-conversion rate by 0.08. “The amount of gestation-sow feed fed is effectively the same regardless of the number of pigs weaned, so if more pigs are weaned per litter, the feed quantity and cost per pig is reduced,” Williams and Neill point out.
Chasing physical targetsis all well and good, but in fact, a herd selling 22 pigs per sow per year with low feed costs, using by-products such as brewery waste or whey, can be more profitable than one selling 24 pigs but buying more expensive compounder feeds. Dietary energy costs are likely to increase, and so, the cost per pound of gain is a critical factor.
Carcass weight is the key parameter, not live weight, and so, average daily gain and feed gain should be calculated per pound of carcass rather than per pound of live weight, the duo says. Today, more fibrous ingredients are being used in grow/finish diets (distillers' dried grains with solubles, wheat midds, soya hulls and such), and the impact on carcass yield must not be underestimated.
For example, every 10 percent of DDGS in the feed will reduce carcass yield by 0.5 percent. More emphasis must be focused on carcass weight as opposed to live weight, Williams and Neill contend. (See table for examples.)
Specific to gilt and sow feeding, the two believe that feed savings of around $24 per gilt can be made when breeding gilts at 210 days of age (or about 300 pounds) versus at 240 days (or 350 pounds). They further point to savings in housing costs plus interest costs, which can boost that savings to $28.25.
“If gilts are mated at a heavier weight, then the weight increase is carried over right through the sow’s life,” they say. A gilt that is bred when 50 pounds heavier will require an extra 0.33 pound of feed per day for maintenance throughout each pregnancy. (See chart for more.)
As for growing pigs,displacing corn with fat is a useful option to consider, as adding fat (from 1 percent to 5 percent) to corn/soybean meal diets improves average daily gain and feed-conversion rate, along with carcass lean percentage. Williams and Neill cite the following example:
Of course, the ingredient costs have to be right. Fat has to be cheap enough to make the substitution cost-effective, and that’s certainly not always the case. These days, fat is being used as a component of biofuels, which has pushed the price up. Also, the type of fat included in the diet is critical, as some can have a deleterious effect on the carcass fat, making it too soft.
As for “novel ingredients,” they are only novel as long as no one else knows about them — when demand is low, the price is low. Some byproducts could be sourced for just the cost to haul them, but when demand increases so does the price and these ingredients are no longer novel; thus, the advantage may be lost. A periodic review needs to be part of the overall strategy.
Over the last 30 years, because of improvements in leanness, finishing pigs' protein, or more accurately amino acid, requirements have increased considerably. Biofuel developments have increased soybean prices, which has led swine nutritionists to review formulations to see if soybean meal can be reduced to lower feed costs per ton. “This can be false economy, as reducing soybean meal can have add-on effects on the carcass along with animal performance,” Williams and Neill note. Including synthetic lysine in the diet is another option, but again the price determines if this is cost-effective.
Feeding today’s hogs is like driving a high-powered car; if you put the wrong gas in a V-12 engine it will only accelerate at half speed. But with the right fuel and some tinkering, you can always squeeze out a bit more performance.
For your pigs to grow and grade at their best, they must be fed the right nutrients in the right amounts, and that varies with the genotype of the animals in your barns. “Genotypes vary a lot, and what might fit one genotype will not be right for another,” Williams and Neill emphasize.
So always ensure that you get the right information from your seedstock supplier, review it and keep it updated, then make adjustments as the ingredient and hog
Stuart Lumb is from Yorkshire, England. He has worked in and reported on the global pork production sector for more than 35 years.