Animal feed is the largest source of nutrients entering hog farms. Grow/finish pigs utilize approximately 35 percent of the nitrogen, 40 percent of the phosphorus and 5 percent of the potassium in a diet. The balance is excreted in manure and is available as potential fertilizer.
Over the past decade, manure’s nutrient quantity has been dropping rapidly. For example, between 2000 and today, phosphorus in grow/finish diet rations has declined 60 percent, from about 8 pounds to about 3 pounds; fed protein has declined approximately 30 percent.
Nutrient reductions are driven by improved feed efficiency and economic pressures to minimize over-feeding of any component. Feed-to-gain ratio has improved more than 10 percent since 2000, shifting from over 3.2 to less than 2.9, which means less feed is needed to raise the same amount of pork. At the same time, dietary phosphorus concentrations have dropped nearly 40 percent from more than 0.6 percent to 0.36 percent or less; protein concentration also has declined over 10 percent. However, the animal’s nutrient retention has not changed much.
The combination of less feed and lower nutrient concentrations has led to a drop in nutrients pigs consume and excrete. Less nutrients in manure mean less manure value for your farm; so the same number of pigs will fertilizer less land than just a few years ago.
As you make feed decisions the first goal is typically to evaluate how much the change costs relative to its feed benefits. For example, feeding phytase has a cost associated with buying the phytase, which can be offset by a reduction in phosphorus fed as dicalcium phosphate. Adding phytase at 500 units per ton might cost about $1.50 per ton, but you could eliminate dical in the diet — a reduction of nearly 4 pounds of elemental phosphorus per ton. That would eliminate about $6.25 per ton, so from a feed basis there is major cost benefit ($6.25- $1.50=$4.75) to including phytase.
Of course, it would reduce the phosphorus in the diet as well as in the manure. If you depend on manure nutrients to fertilize your corn crop, that reduction may increase your commercial fertilizer costs. In the phytase example, the lost phosphorus fertilizer value is about $2.60 per ton fed. So the net benefit of phytase to a farm purchasing feed and using the manure as fertilizer is $2.15 per fed ton ($6.25-$1.50-$2.60=$2.15). The benefit of adopting phytase is still positive, but it is substantially less than basing it solely on feed value.
With byproduct feeds there are times when the fertilizer value can impact feed decisions. Dried distillers' grains with solubles and cottonseed meal are two examples of feeds with high phosphorus concentrations compared to the corn and soybean meal they displace.
For example, a farm may move from 10 percent to 40 percent DDGS in a diet, a shift that would increase the diet’s total phosphorus. In this case, the phosphorus concentration increased from 0.36 percent to 0.53 percent. Using a feed-value-only calculation the apparent savings is $23 per ton. Accounting for the manure’s increased fertilizer value, the true value is $30 per ton. The high DDGS diet doubled the manure’s fertilizer value from $7 per fed ton to $14 per fed ton.
With today’s volatile commodity prices, the impact of fertilizer value on feed decisions changes too. In 2008, we reviewed the impact of fertilizer value on a range of grow/finish diets. At the time, many feed and fertilizer costs were at historic highs.
To benefit from a feed’s fertilizer value you must be able to utilize all the added nutrients in the manure. Not all farms should account for fertilizer value in its feed calculations, such as operations with limited land. Operations that sell manure at prices below the commercial fertilizer price will benefit less, and operations using lagoons will lose nutrients as they settle to the bottom or are volatilized to the atmosphere. Those that have the most to gain will be deep-pit, slurry operations where the producer uses all the manure to meet crop nutrient needs and reduce fertilizer purchases.
The ownership structure also raises questions. An independent operation that manages both feed and manure application can use the analysis to calculate the net value of its feed decisions for both sectors. In contrast, contract operations typically get feed from the contractor and use the manure on their cropland. The contractor makes decisions based on feed-only criteria, and the grower absorbs the impact on the manure’s fertilizer value.
For example, a contractor may choose to use phytase to reduce dietary phosphorus, which reduced feed costs under both 2008 and 2009 examples. For the contract grower, that decision reduced the dietary phosphorus and the acres that could be fertilized. In 2009, it also reduced the manure’s fertilizer value.
Or, a contractor may increase dietary phosphorus to take advantage of a lower-cost byproduct such as DDGS. This benefits the contractor with lower feed costs, and the grower gets more manure nutrients to fertilize more acres.
Contracts don’t typically carry incentives to consider the impact of feed decisions on the manure’s fertilizer value. Yet, many newer contract operations were built to give the grower access to the manure, which represents a substantial proportion of annual income. Changing the nutrient content can have real implications on the bottom line. In the future, there needs to be ways to equitably distribute the costs and benefits so contractors and growers both have incentives to optimize nutrients in feed and manure for their mutual benefit.
Editor’s note: Marcia Shannon, animal scientist; Ray Massey, agricultural economist; and Joe Zulovich, agricultural engineer, with the University of Missouri, also participated in the research.
Fertilizer Value Versus Feed Costs
At that time of the study, the fertilizer value of manure nutrients ranged from $14 to $27 per ton of feed. Note that the low-cost diet was the same with or without considering the feed’s fertilizer value, but after that, the fertilizer value affected the rank of the least expensive diet. Looking just at feed cost implied there was only $1 difference in the cost between the 10 percent- and 20 percent-plus-phytase feeds, and the 10 percent DDGS feed was the better deal. Integrating fertilizer value into the analysis demonstrated that the 20 percent DDGS was a substantially lower cost feed ($5 less per ton).
Since this analysis was completed, prices for many of the inputs have dropped, some dramatically. Phosphorus used in fertilizer has declined in price by over 60 percent. Under current conditions, integrating fertilizer value into the feed cost calculation does not change the rank of the low-cost feed options. However, feed’s fertilizer value does affect the size of the relative benefits among feeds.