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Articles from 2014 In August


The next feed formulation frontier

The next feed formulation frontier

STOP and ask yourself, "Is what I am doing right now valuable to my customer?" Okay, you may not know until you get further into this article, but I hope you will glean at least one actionable, value-generating idea here that can benefit your customers.

So, here's my first shot at making this worth your while: Ask yourself that opening question. Ask it often. Ask it especially when it feels like the answer might be "no!" Ask it, and then take action. Stop doing things that do not add customer value. Challenge the status quo.

Voltaire, a pretty smart guy, once said: "One day everything will be well; that is our hope. Everything's fine today; that is our illusion."

It's just never true that everything is fine today. Someone — somewhere — is plotting to take your customers away from you. If you formulate feed, you have many opportunities to do your part to prevent that from happening because formulating feeds involves "what-if" scenarios: What if I raise that maximum or lower that minimum? What if I offer an alternative ingredient? What if I can think of a better way to serve this customer's needs?

As I write this final column for Feedstuffs — I am retiring after 36 years in the animal nutrition business — I like to think that I've challenged the status quo in a number of meaningful ways, but of course, I could have done more.

Still, it has been quite a ride. When I entered this industry as a research dairy nutritionist, I had a serviceable feed formulation program and a ration formulation program that definitely needed some work. One of my first projects was to "fix" the ration formulation software.

There were no desktop computers back then, so here's how my ration formulation software solution worked: A feed salesperson filled out a paper template with animal and feedstuff information. The form was snail-mailed to headquarters. A nutritionist edited the form and sent it to the data center. Computer cards were keypunched and fed into the mainframe computer. The next morning, the nutritionist received a faint, dot-matrix ration printout.

The first run was almost never a practical ration, so one or more rounds of tweaking followed, each accompanied by another overnight run. When a practical ration was finally achieved, it was snail-mailed to the salesperson, who would take it to the farm on a subsequent sales call. Voila! The dairy producer would have a computer-generated ration in only a couple of weeks or so!

Just think about how many challenges to that status quo have led us to where we are today.

After a lot of fits and starts with early-stage formulation solutions — as well as some annoying prodding by people like me who could be counted on to challenge the status quo — today's advanced formulation solutions bear no resemblance whatsoever to the arcane programs we used when I was getting started in the business. Instead, our diligence has paid off handsomely with the advent of sleek, intuitive, integrated solutions that work seamlessly with other operations programs and customer systems.

Are things perfect? Absolutely not. Do we set ambitious goals? Without a doubt. Mark my words, in the very near future, we can (and must) expect our formulation data to be served up to our portable devices in exactly the format and order we need to view them.

To function effectively in the formulation universe of the (near) future, we must be able to execute our what-if scenarios on our smartphones, in airports across the planet and get it all done in a fraction of the time it took just a few decades ago.

Thanks to lots of tech people and subject matter experts challenging the status quo, I now receive almost no snail-mail. I generate my own documents, get hundreds of emails and text-messages every week and attend virtual meetings from anywhere. I could go on, but you live in the same world I do — a world propelled forward at a sometimes dizzying rate of change.

As we continue to advance to the next formulation frontier, many around you will continually challenge the effectiveness and efficiency of technological programs designed to make their work easier and more effective, and although you may find these people irritating, remember this: It is because of them — because they relentlessly asked "why?" — that we have moved from piles of paper to digital domains.

In his now legendary 1962 speech on why America should explore space, President John F. Kennedy said to students at Rice University: "We choose to go to the moon in this decade and do the other things not because they are easy, but because they are hard."

A decade earlier, when explorer Sir Edmund Hillary was asked why he wanted to climb Mt. Everest, he famously replied, "Because it's there."

These two men tapped into one of the great motivators for human exploration: the desire to go beyond the horizon and discover something simply because we can.

While we may continue to struggle with formulation systems as they are today, it's important to understand that only through this continuous refinement, experimentation and exploration can we achieve formulation systems as we want them to be. Choosing, using and leveraging technology are critical to our industry's success.

Today, we live in an interconnected global food chain in which our formulation skills can have a profound impact on the ability to provide a safe and nutritious food supply to the world.

So, please, don't tolerate a dysfunctional status quo. Empower people to accomplish customer value-adding activities. Let them do their work without repressive rules and procedures.

Here's the trigger: Ask yourself sincerely and often, "Is what I'm doing right now adding any value for my customers?" If the answer is no, it's time to challenge the status quo.

Thank you all for providing me with a lifetime of opportunities to learn and explore in this industry that I love so much. I will enjoy watching your next conquest, and I wish all of you the very best.

*Dr. John Foley is the global portfolio manager for Feed Management Systems, focusing on feed formulation, ration formulation and related software solutions that enhance ingredient evaluation (including nutrient measurement) and the flow of essential nutrition and pricing data in the animal nutrition industries. Foley can be reached at jfoley@feedsys.com.

Volume:86 Issue:35

Ingredient market prices, 9/1/14

Ingredient market prices, 9/1/14

The following prices, which include delivery, were obtained Aug. 27 from feed and grain vendors in the U.S. and Canada. The prices represent current trading values but are not guaranteed. Second column shows the amount of change since the previous week. Prices of certain products can vary depending on the processing method used. N-Nominal. N/A-Price not available.

OILSEED PRODUCTS

 

 

(dollars per ton)

 

 

Soybean meal

 

 

(high-protein)

 

 

Atlanta

660.00

52.00

Boston

546.00

-

Buffalo

631.00

68.00

Chicago

607.00

124.00

Delmarva

N/A

-

Fayetteville NC

670.00

52.00

Ft. Worth

652.00

-

Kansas City

585.00

135.00

Los Angeles

623.00

86.00

Memphis

510.00

40.00

Minneapolis

624.70

64.70

Okeechobee

690.00

52.00

Portland

611.20

77.90

San Francisco

623.00

86.00

Twin Falls

669.00

98.00

Soybean meal

 

 

(low-protein)

 

 

Atlanta

650.00

42.00

Boston

541.00

-

Buffalo

627.00

68.00

Chicago

595.00

124.00

Delmarva

N/A

-

Fayetteville NC

660.00

52.00

Ft. Worth

N/A

-

Kansas City

585.00

135.00

Los Angeles

586.00

80.00

Memphis

500.00

40.00

Minneapolis

N/A

-

Okeechobee

680.00

52.00

Portland

N/A

-

San Francisco

586.00

80.00

Soybean hulls

 

 

Atlanta

215.00

-

Buffalo*

225.00

-10.00

Chicago

190.00

5.00

Fayetteville, NC

337.00

-

Ft. Worth*

210.00

10.00

Los Angeles

180.00

10.00

Minneapolis

200.00

65.00

Okeechobee

327.00

-

San Francisco

180.00

10.00

Twin Falls

195.00

-50.00

* unpelleted

 

 

Whole cottonseed

 

 

Atlanta

N/A

-

Buffalo

432.00

-13.00

Chicago

393.00

-

Delmarva

N/A

-

Fayetteville NC

N/A

-

Ft. Worth

330.00

-

Los Angeles

455.00

1.00

Lubbock

320.00

-5.00

Memphis

N/A

-

Okeechobee

N/A

-

Portland

450.00

-15.00

San Francisco

455.00

1.00

Twin Falls

340.00

-100.00

Cottonseed meal

 

 

Atlanta

380.00

-

Chicago

350.00

12.00

Delmarva

380.00

-

Fayetteville NC

380.00

-

Ft. Worth

330.00

-5.00

Kansas City

370.00

-

Los Angeles

N/A

-

Lubbock

300.00

-

Memphis

340.00

15.00

Okeechobee

414.00

-

San Francisco

325.00

-3.00

Cottonseed hulls

 

 

Atlanta

190.00

30.00

Chicago

190.00

-

Fayetteville NC

190.00

30.00

Ft. Worth

225.00

40.00

Okeechobee

227.00

30.00

Los Angeles

N/A

-

Lubbock

195.00

-5.00

San Francisco

N/A

-

Canola meal

 

 

Buffalo

345.00

20.00

Minneapolis

371.70

26.90

Los Angeles

298.00

11.00

Montreal

311.00

-

Portland

302.85

-2.55

San Francisco

298.00

11.00

Twin Falls

352.00

7.00

Vancouver

380.00

30.00

Sunflower seed meal

 

 

Fargo

150.00

-

Minneapolis

135.00

-15.00

Linseed  meal

 

 

Atlanta

N/A

-

Chicago

315.00

55.00

Fargo

N/A

-

Fayetteville NC

N/A

-

Ft. Worth

N/A

-

Kansas City

320.00

-10.00

Minneapolis

290.00

35.00

Safflower meal

 

 

Los Angeles

N/A

-

San Francisco

N/A

-

ANIMAL BYPRODUCTS

 

 

(dollars per ton)

 

 

Meat and bone meal

 

 

(ruminant)

 

 

Buffalo

N/A

-

Chicago

485.00

-

Delmarva

535.00

-

Fayetteville NC

540.00

-20.00

Ft. Worth

460.00

-

Kansas City

450.00

-20.00

Los Angeles

475.00

-5.00

Memphis

520.00

-10.00

Minneapolis

460.00

-15.00

Portland

455.00

-12.50

San Francisco

485.00

-5.00

Meat and bone meal

 

 

(porcine)

 

 

Fayetteville NC

570.00

-10.00

Los Angeles

524.00

-5.20

Memphis

560.00

-10.00

Minneapolis

520.00

-40.00

Flash-dried blood meal

 

 

(ruminant)

 

 

Fayetteville NC

1775.00

-

Los Angeles

1775.00

-

Memphis

1750.00

-

Minneapolis

1725.00

-25.00

Flash-dried blood meal

 

 

(porcine)

 

 

Fayetteville NC

1825.00

-

Memphis

1800.00

-

Minneapolis

1775.00

-25.00

Poultry byproduct meal

 

 

(feed grade)

 

 

Atlanta

395.00

-

Fayetteville NC

600.00

-

Ft. Worth

385.00

-35.00

Kansas City

N/A

-

Los Angeles

627.00

-6.00

Memphis

600.00

-

Poultry byproduct meal

 

 

(pet food grade)

 

 

Memphis

800.00

-

Fayetteville NC

800.00

-

Hydrolized feather meal

 

 

Atlanta

480.00

-

Delmarva

710.00

10.00

Fayetteville NC

600.00

10.00

Ft. Worth

730.00

10.00

Kansas City

805.00

10.00

Los Angeles

N/A

-

Memphis

600.00

10.00

Minneapolis

725.00

-

Menhaden fish meal

 

 

Atlanta

1125.00

-

Buffalo

N/A

-

Chicago

1325.00

-

Fayetteville NC

1085.00

-

Ft. Worth

N/A

-

Kansas City

N/A

-

Memphis

1175.00

-

Minneapolis

1690.00

-

Twin Falls

N/A

-

Blended tuna meal

 

 

Los Angeles

N/A

-

San Francisco

N/A

-

Anchovy  meal

 

 

Los Angeles

N/A

-

San Francisco

N/A

-

ANIMAL FAT, GREASE

 

 

(cents per pound)

 

 

Prime Tallow

 

 

Chicago

31.00

-

Ft. Worth

N/A

-

Los Angeles

32.13

-

San Francisco

29.25

-

Yellow grease

 

 

Buffalo

N/A

-

Chicago

32.00

-

Delmarva

N/A

-

Fayetteville NC

30.00

-2.00

Ft. Worth

28.50

-1.50

Kansas City

34.50

0.50

Los Angeles

31.13

-

Memphis

30.00

-2.00

Minneapolis

30.00

-2.00

San Francisco

28.25

-

Choice white grease

 

 

Chicago

39.00

-

Minneapolis

36.50

-1.50

Bleachable fancy tallow

 

 

Buffalo

N/A

-

Chicago

40.00

-

Ft. Worth

36.50

-3.50

Los Angeles

N/A

-

Minneapolis

37.00

-3.00

San Francisco

N/A

-

Vegetable-animal blend

 

 

Ft. Worth

29.00

-2.00

Los Angeles

30.63

-0.88

Minneapolis

30.50

-1.75

San Francisco

30.63

-0.88

Poultry grease

 

 

(feed grade)

 

 

Delmarva

31.00

-

Fayetteville NC

30.00

-2.00

Memphis

30.00

-2.00

Poultry grease

 

 

(pet food grade)

 

 

Memphis

35.00

-2.00

Fayetteville NC

35.00

-2.00

GLUTEN, HOMINY

 

 

(dollars per ton)

 

 

Corn gluten meal

 

 

Buffalo

667.00

10.00

Chicago

655.00

70.00

Kansas City

690.00

40.00

Los Angeles

665.00

15.00

Corn gluten feed

 

 

Buffalo

148.00

-

Chicago

115.00

7.00

Fayetteville NC

130.00

8.00

Kansas City

160.00

5.00

Okeechobee

150.00

8.00

Twin Falls

195.00

5.00

Wahpeton

N

-

Hominy feed

 

 

Atlanta

170.00

-

Boston

160.00

-

Buffalo

175.00

4.00

Chicago

99.00

-

Fayetteville NC

292.00

-

Kansas City

115.00

-

Los Angeles

182.00

-

Okeechobee

285.00

-

San Francisco

182.00

-

Twin Falls

190.00

-

BREWERS, DISTILLERS

 

 

(dollars per ton)

 

 

Brewers dried grains

 

 

Chicago

N/A

-

Kansas City

N/A

-

Malt Sprouts

 

 

Chicago

175.00

-

Milwaukee

175.00

-

Winona, Minn

175.00

-

Distillers dried grains

 

 

Atlanta

145.00

-

Boston

184.00

-

Buffalo

155.00

27.00

Chicago

125.00

-

Fayetteville NC

145.00

-

Kansas City

140.00

-10.00

Los Angeles

173.00

15.00

Minneapolis

105.00

-20.00

Okeechobee

155.00

-

Portland

187.50

8.50

San Francisco

173.00

15.00

Twin Falls

188.00

1.00

Brewers yeast

 

 

(dollars per pound, sacked)

 

 

Chicago

0.75

-

Milwaukee

0.75

-

Minneapolis

0.75

-

ALFALFA

 

 

(dollars per ton)

 

 

Dehydrated pellets

 

 

(17% protein)

 

 

Alfalfa Center

330.00

-

Buffalo

375.00

-

Chicago

355.00

-

Kansas City

325.00

-

Los Angeles

N/A

-

Minneapolis

265.00

-20.00

Toledo

395.00

-

San Francisco

N/A

-

Suncured pellets

 

 

(15% protein)

 

 

Atlanta

N/A

-

Ft. Worth

260.00

5.00

Kansas City

265.00

3.00

Los Angeles

N/A

-

Portland

340.00

-

San Francisco

N/A

-

WHEAT MILLFEEDS

 

 

Shorts

 

 

Chicago

155.00

-

Ft. Worth

N/A

-

Los Angeles

162.00

1.00

Millrun

 

 

Los Angeles

153.00

1.00

Portland

175.00

-

San Francisco

163.00

-

Twin Falls

145.00

-

Bran

 

 

Buffalo

152.00

15.00

Chicago

135.00

-

Los Angeles

157.00

1.00

Minneapolis

345.00

-

Middlings

 

 

Buffalo

122.00

15.00

Chicago

120.00

-

Fayetteville NC

N/A

-

Ft. Worth

170.00

30.00

Kansas City

92.00

7.00

Los Angeles

160.00

1.00

Memphis

168.00

18.00

Minneapolis

132.00

37.00

Okeechobee

N/A

-

DAIRY BYPRODUCTS

 

 

(dollars per hundredweight)

 

 

Dried skim milk

 

 

Ft. Worth

157.75

-10.00

Minneapolis

157.75

-10.00

Dried buttermilk

 

 

Ft. Worth

146.00

-7.63

Minneapolis

146.00

-7.63

Whole whey

 

 

Chicago

65.75

-

Ft. Worth

65.50

-0.25

Kansas City

58.00

-

Minneapolis

65.50

-0.25

Whey protein concentrate

 

 

Ft. Worth

151.00

-3.00

Milwaukee

151.00

-3.00

Lactose

 

 

Ft. Worth

53.13

-

Minneapolis

53.13

-

OATS, RICE PRODUCTS

 

 

(dollars per ton)

 

 

Rolled oats

 

 

Chicago

570.00

-

Kansas City

530.00

-10.00

Minneapolis

517.00

-5.00

Crimped oats

 

 

Chicago

470.00

-

Kansas City

385.00

-

Minneapolis

440.00

-

Pulverized oats

 

 

Chicago

155.00

-

Minneapolis

148.00

-

Reground oat feed

 

 

Chicago

90.00

-

Kansas City

80.00

-

Minneapolis

72.00

-

Oats

 

 

(dollars per bushel)

 

 

Buffalo

4.00

-

Minneapolis

3.00

-0.86

Portland*

287.50

-

(*per ton)

 

 

Rice bran

 

 

Atlanta

N/A

-

Ft. Worth

180.00

5.00

Freeport

N/A

-

Kansas City

178.00

3.00

Memphis

N/A

-

San Francisco

214.00

10.00

Stuttgart, Ark.

N/A

-

Rice millfeeds

 

 

Atlanta

N/A

-

Ft. Worth

110.00

-

Freeport

N/A

-

Kansas City

115.00

-

Memphis

N/A

-

Stuttgart, Ark.

N/A

-

Rice hulls

 

 

Ft. Worth

75.00

-

Kansas City

80.00

-

DRIED PULP

 

 

(dollars per ton)

 

 

Citrus pulp pellets

 

 

Atlanta

240.00

8.00

Fayetteville NC

250.00

8.00

Okeechobee

195.00

-70.00

Los Angeles*

N/A

-

*(sold wet)

 

 

Beet pulp pellets

 

 

Atlanta

N/A

-

Boise

N/A

-

Chicago

270.00

-

Fayetteville NC

N/A

-

Kansas City

470.00

-

Minneapolis

180.00

-

Portland

230.00

-

Saginaw

200.00

-

Beet pulp shreds

 

 

Mpls (sacked)

340.00

-

Los Angeles*

224.00

4.00

San Francisco

N/A

-

Twin Falls

N/A

-

*bulk, wet

 

 

GRAINS

 

 

Barley feed

 

 

Kansas City (bu.)

4.65

-0.05

Los Angeles (cwt)

10.45

-0.05

Portland (ton)

190.00

-2.50

San Francisco (cwt)

10.45

-0.05

Feed wheat

 

 

Atlanta (bu.)

10.31

-

Fayetteville NC (bu.)

10.31

-

Kansas City (bu)

5.33

0.15

Los Angeles (cwt)

14.00

-0.50

San Francisco (cwt)

14.00

-0.50

Corn

 

 

(dollars per bushel)

 

 

Atlanta

5.28

-

Boston

3.96

-

Buffalo (per ton)

158.00

3.00

Chicago

3.96

0.06

Delmarva

3.87

-0.13

Fayetteville NC

5.08

-

Ft. Worth

N/A

-

Kansas City

3.61

-0.14

Los Angeles*

9.88

-0.30

San Fran (rail)*

9.88

-0.30

San Fran (truck)*

N/A

-

Memphis

3.84

0.12

Minneapolis

3.59

-

Okeechobee

5.53

-

Portland (per ton)

179.00

-4.00

(*per cwt)

 

 

Milo

 

 

(dollars per bushel)

 

 

Atlanta

N/A

-

Fayetteville NC

N/A

-

Ft. Worth

N/A

-

Kansas City

3.25

-0.05

Los Angeles*

9.84

-0.33

Memphis

3.78

0.09

*(per cwt.)

 

 

Ground grain screenings

 

 

(dollars per ton)

 

 

Ft.  Worth

147.00

-

Kansas City

95.00

-

OTHER

 

 

(dollars per ton)

 

 

Almond hulls

 

 

Los Angeles

162.00

-5.00

San Francisco

147.00

-3.00

Bakery feed

 

 

Atlanta

215.00

-10.00

Buffalo

N/A

-

Fayetteville NC

210.00

-20.00

Memphis

210.00

-10.00

Minneapolis

180.00

-

Feed urea

 

 

Buffalo

N/A

-

Ft. Worth

N/A

-

Los Angeles

N/A

-

Minneapolis

N/A

-

Salt

 

 

Kansas City

48.50

-

Los Angeles

50.00

-

Cane molasses

 

 

Ft. Worth

N/A

-

Houston

152.50

-

Kansas City

190.00

-

Los Angeles

N/A

-

Memphis

N/A

-

Minneapolis

210.00

-

New Orleans

155.00

-

San Francisco

N/A

-

 

Volume:86 Issue:35

WTO decision made on India poultry dispute

The United States is awaiting translation of the ruling from the World Trade Organization (WTO) dispute settlement panel in regards to poultry imports to India.  In 2012, the United States launched a WTO dispute, claiming India placed an unjustified ban of the import of U.S. poultry and live pigs because of an outbreak of a low pathogenic avian influenza in Virginia years early. The ban was put in place even though the United States has not had an outbreak of high pathogen avian influenza since 2004.

The dispute settlement panel has made their ruling, but it will not be released publicly until it is translated into different languages, according to American Farm Bureau Federation economist Veronica Nigh.  The report is to be translated into Spanish and French and will be publicly released as soon as that process is complete, Nigh said.

Once the United States and India both know the result of the ruling, the United States and India could both agree on the final report findings and work to develop a program to remove the trade barrier that has been alleged.  Or, if the United States and India do not agree, the process will continue and one of the two parties, or both, could appeal the ruling.  The ruling would then be sent back into the dispute settlement process where the case would be re-heard and another report would be filed.

Canadian Pacific unveils new plan, takes heat

ON  August 22, Canadian Pacific (CP) updated its plan to resolve the backlog of unfilled grain car orders in response to an August 18 U.S. Surface Transportation Board (STB) order, but the new plan, which requires grain elevators to cancel a majority of their existing orders, has drawn criticism from public officials. CP said it believes the new grain-car request system will provide a more accurate reflection of the grain backlog.

As a first measure, shippers removed 16,256 unneeded open requests from the system, bringing the new estimate of the backlog down to 11,989 open requests, and CP expected this number to fall significantly in the weeks to follow as customers were expected to continue to remove unneeded open requests.

CP said it also planned to modify and improve its planning process for small shipments, increase employees, deploy a new shuttle service, improve routing options with customers, and supply additional locomotives to the Rapid City, Pierre, and Eastern Railroad operating in South Dakota.

Upon hearing of CP’s plan, Sen. Heidi Heitkamp (D., N.D.) called out Canadian Pacific Railway chief executive officers E. Hunter Harrison, saying the company’s plan is “seriously flawed.”

Specifically, Heitkamp said the company’s new rail car order and shuttle train system ignores the current number of unfulfilled requests from grain elevators, and forces North Dakota’s farmers and grain operators to start from scratch in the middle of the state’s harvest season. It’s making grain elevators essentially leave massive quantities of crops on the side of the road while the railroad will only transport new grain orders, according to Heitkamp.

Numerous grain elevators who are customers of Canadian Pacific have contacted Heitkamp about the problems with the new system. For many, their number of open requests for grain cars has recently dropped dramatically, but it wasn’t because Canadian Pacific has fulfilled those requests. Rather, it was because CP was making them cancel most of their open orders, leaving grain elevators without certainty that they would receive the cars they need under the new system. It also was preventing them from selling the grain that had been delayed for months.

Just over a week ago, some grain elevators using CP reported past-due cars ranging anywhere from 200 to 2,000 cars. But now, under the company’s new system, those delays range from zero to 50 cars, despite Canadian Pacific moving far fewer cars than necessary to actually achieve such dramatic reductions in this short timeframe.

“Canadian Pacific is trying to pretend like the massive agricultural shipment delays across North Dakota don’t exist despite the fact that grain has been piling up around the state for months,” said Heitkamp. “Our farmers and grain elevators are suffering, and just leaving crops from the past few months that haven’t been shipped – because of the railroad’s failure to deliver cars – on the side of the road hurts us all, including our state’s economy. While Canadian Pacific’s new reporting system may provide more transparency in the long run, the company cannot just sweep under the rug the delays of the past year and start from scratch.”

Rep. Kevin Cramer (R., N.D.) also responded to CP’s new plan, saying he would “not tolerate bullying tactics of any kind, especially given the pressures already placed on our agriculture industry.” Cramer added that he had made the Surface Transportation Board aware, and explained he would address the “serious matter” during an upcoming hearing.

The Surface Transportation Board has a hearing scheduled Sept. 4 in Fargo, North Dakota to address the ongoing grain backlog and the railroad companies plan to resolve it. View a list of scheduled speakers. A live video of the hearing will be available at www.stb.dot.gov under “Information Center:  / Webcast / Live Video” on the home page.

Waters of the U.S. maps cause concern

The scope of the Environmental Protection Agency’s plan to increase its footprint of regulating waters of the U.S. came under fire as maps were released by the agency which showed an astonishing number of potential waterways that could come under EPA’s jurisdiction in its latest proposed rule. 

The House Committee on Science, Space, and Technology released maps of waters and wetlands the EPA has to-date refrained from making public. After multiple requests, the Agency finally handed over the maps to the committee.

Knowledge of the maps came as the Committee was doing research in preparation for a hearing regarding the proposed “Waters of the United States” rule. The maps were kept hidden while the agencies marched forward with rulemaking that fundamentally re-defines private property rights, said Smith.

Answering the criticisms, Tom Reynolds EPA associate administrator of the Office of External Affairs and Environmental Education, explained the maps were originally created in 2005 during the previous administration to understand the potential impact of Supreme Court decisions on the nation’s water resources.  The maps were revised last year with updated data from the U.S. Geological Survey, the scientific agency for cataloguing the nation’s natural resources.

“Simply put, these maps do not show the scope of waters historically covered under the Clean Water Act or proposed to be covered under EPA’s proposed rule. These maps show generally the location of many streams, wetlands, rivers, lakes and other water bodies. They serve as a tool for visualizing how water flows across our nation and in regions of the country,” he said.

Reynolds said EPA “has never and is not now relying on maps to determine jurisdiction under the Clean Water Act.” Rather the Army Corps of Engineers determines jurisdiction using detailed site specific information in response to requests. “EPA’s proposal will not fully eliminate the need for these efforts, but it can reduce leg work, saving time and money by using science – not maps – to more clearly define the waters that are most important to protect.” 

Reynolds promised that while these maps are useful tools for water resource managers, “they cannot be used to determine Clean Water Act jurisdiction – now or ever.”

These maps are very similar to the maps produced by agricultural groups. These maps show individual states facing upwards of 100,000 additional stream miles that could be regulated under the proposed regulation.

“Given the astonishing picture they paint, I understand the EPA’s desire to minimize the importance of these maps,” said Rep. Lamar Smith (R., Texas), chairman of the House Science Committee, in a letter to EPA administrator Gina McCarthy. “But EPA’s posturing cannot explain away the alarming content of these documents. While you claim that EPA has not yet used these maps to regulate Americans, you provided no explanation for why the Agency used taxpayer resources to have these materials created.”

“This is the smoking gun for agriculture,” said Ashley McDonald, National Cattlemen’s Beef Assn. environmental counsel. “These maps show that EPA knew exactly what they were doing and knew exactly how expansive their proposal was before they published it.”

Sen. Mike Johanns (R., Neb.) shared that the perception of EPA in the countryside is that they’re “an enemy of agriculture. EPA will “pay lip service to you, but doesn’t change anything and continue to march on down the road with more regulations.” Johanns said the waters of the U.S. rule is a perfect example of how EPA pushes its regulatory agenda without taking into account the economic and real-life impacts.

Despite setbacks, China 'Hit for the Cycle' in 2014

DESPITE all of the current challenges surrounding imports for feed ingredients, the U.S. Grains Council (USGC) recently reported that China has accomplished a feat never before seen in agricultural exports. According to Chinese customs and U.S. Department of Agriculture (USDA) data, China has imported more than 3 million metric tons each of U.S. corn, sorghum and distiller’s dried grains with solubles (DDGS) for this marketing year, which ends Aug. 31.

Based on the rapid pace of China’s corn purchases at the beginning of the marketing year, few people would have thought the most challenging component of this three-part purchasing record would have been corn imports. After China’s Nov. 13 announcement of zero tolerance for Syngenta’s MIR 162 trait, however, China’s corn imports from the United States ground to a halt.

But, the reduction in corn imports resulted in a surge in sorghum imports, said USGC.

“This year, China is forecast to take more than 30% of U.S. sorghum production, making it by far the single biggest user for the grain,” stated USGC. “The U.S. Grains Council has actively been promoting sorghum in China due to the fact that it is not subject to a tariff rate quota restriction, like corn.”

Despite all of the complexities surrounding China’s feedstuff needs, USGC said one thing remains constant: end-users love the quality and value of imported feed products. “Huge import margins remain for corn, sorghum and DDGS due to high domestic price support policies. Despite several years of production increases and a record crop last year, corn prices in China continue to rise.”

Additionally, USGC explained that the demand for high-quality corn continues to outpace available supply. According to the most recent USGC data, theoretical import margins into southern Chinese ports now stand at almost $180 per ton.

USGC staff members continue to work toward a solution for the recent trade disruptions regarding corn and DDGS. “Despite the current issues, it is important to stay focused on aggregate demand and to acknowledge the important landmark of China taking than 3 million tons of these important products.”

“Factoring in China importing 7.5 million tons of U.S. soybeans last month, if this were baseball, you could say China has ‘hit for the cycle,’ getting a single, a double, a triple and a home run in the same baseball game,” said Kevin Roepke, USGC director of trade development in China. “The demand is clearly there. This is quite a historic moment, especially when you consider all of the challenges.”

Xylanase characteristics key to enzyme-added feeds

Xylanase characteristics key to enzyme-added feeds

*Dr. Craig Wyatt is a poultry technical manager with AB Vista.

ALTHOUGH the use of non-starch polysaccharide (NSP)-degrading feed enzymes has grown steadily in recent years, there remains considerable confusion regarding the factors that determine enzyme efficacy within the animal.

Not only are the enzymes themselves a diverse group, but the substrates that they target can also vary considerably.

The key to achieving a consistent response, therefore, is to better understand both the enzyme characteristics that are critical to efficacy and how those characteristics relate to the substrates being targeted.

 

Substrate differences

The most abundant hemicellulose NSP fraction being targeted is xylan.

The challenge is that this substrate is composed of differing numbers of xylose sugars, with zero, one or two arabinose side-chains, making the structure of the xylan backbone quite variable.

For example, the xylans in cereals tend to contain high numbers of arabinose side-chains — making it highly "substituted" — and the more highly substituted a xylan is, the more water soluble it tends to become.

This difference in structure not only determines the level of impact on digesta viscosity caused by high levels of soluble long-chain xylans, but it also influences where any "cleaving" of the xylose backbone by a xylanase can take place and the xylanase characteristics needed to achieve it.

 

Xylanase action

In general terms, a xylanase can act in one of two ways: either by cleaving the xylose backbone mid-chain (endo-acting) to produce shorter-chain arabinoxylo-oligosaccharides (AXOS), or by acting at the ends of the chain (exo-acting) to release free xylose or arabinose sugars.

Additional differences between endo-acting xylanases include the presence — or absence — of the ability to cleave the xylose backbone adjacent to an arabinose side-chain or break it down beyond a certain size.

These are important differences. The breakdown of long-chain soluble xylans by endo-acting xylanases is the primary mechanism by which digesta viscosity is reduced in so-called "viscous" diets, such as those containing wheat. The same effect cannot be achieved rapidly enough to prevent digestion being disrupted if using exo-acting xylanases, if the dose of endo-acting xylanase is insufficient or if the endo-acting xylanase is poorly targeted (Figure 1).

In addition, it is now widely recognized that high concentrations of free xylose and arabinose can be detrimental to animal performance (Figure 2) as neither the xylose nor the arabinose sugars released by exo-acting xylanases can be digested. Contrary to what some might think, complete xylan degradation is, therefore, not desirable and should not be the target for xylanase use, whether through additional enzyme activities or by overdosing.

 

Specificity matters

Instead, it appears that the greatest performance benefits arise when the products generated by xylan hydrolysis are specific AXOS that have the potential to act as a prebiotic within the animal. This is one of the main mechanisms by which xylanases can improve nutrient digestibility and animal performance in non-viscous, corn-based diets, as well as contributing to responses in viscous diets.

Yet, it can be achieved only through the use of endo-acting xylanases, and only those that are correctly matched to the substrate and end products being targeted.

Such specificity varies considerably among xylanases. Some, such as those categorized as GH11 xylanases, are more specific in their site of action and the AXOS produced and will not break short-chain AXOS into free xylose and arabinose. The activity of others may be less specific and act similarly on long- or short-chain xylans, thus further degrading the beneficial oligosaccharides.

The extent of xylan breakdown can, therefore, vary hugely among xylanases, and this will affect not only AXOS production but also digesta viscosity (Figure 3). Some xylanases may even act to increase digesta viscosity by breaking down insoluble xylan in such a way as to increase the overall level of soluble xylan present.

 

Efficacy differences

The key is to ensure that the right dose of the right xylanase arrives in a still-active state at the point of action, namely the stomach and small intestine of the target animal. It is, therefore, critical that an effective xylanase can survive the acidic conditions and digestive enzymes (mainly pepsin) of the stomach, is active between pH 3 and 6 and at around 104 degrees F (40 degrees C), yet can withstand high-temperature pelleting and not be denatured by temperatures greater than 140 degrees F (60 degrees C).

Although the latter is sometimes achieved through application of coating technologies that are dissolved in the stomach, this does preclude any potential for the xylanase to begin acting during the feed production process pre-pelleting.

The ability to apply an intrinsically thermostable xylanase as a dilute liquid to the batch mixer has been shown to not only improve coefficients of variation to around 5% in mash and pellets but also reduce pelleting power consumption by up to 4%.

 

End user challenges

The challenge for the end user is the myriad of choices even within a single group of enzymes, such as xylanases. Action, efficacy and specificity can depend on the source (most are now fungal derived), the presence of poorly defined or undeclared side activities (which may take xylan degradation too far) and the ability of the applied dose to survive feed processing.

Where an effective xylanase capable of surviving high-temperature feed processing is used, however, the response is not only significant statistically but also commercially (Figure 4). Such performance responses are also more consistent across different diets and seasons and capable of more reliably providing the expected return on investment.

Choosing a xylanase with the right characteristics to achieve the desired result is essential. Much of the inconsistency in animal performance effects reported for xylanase use in corn-based diets can be attributed to poor enzyme choice. However, a correctly managed approach, using a well-targeted xylanase optimized for activity in the animal and regularly monitored to ensure correct in-feed activity levels, can be relied upon to perform as expected.

Xylanase characteristics key to enzyme-added feeds

Volume:86 Issue:35

Statistical process control in feed mill

Statistical process control in feed mill

Use of statistical process control during the feed manufacturing process can improve quality parameters and reduce manufacturing costs.

By CHARLES STARK*

*Dr. Charles Stark is the Jim & Carol Brown associate professor in feed technology at Kansas State University.

AS Dr. Adam Fahrenholz mentioned in last month's Feed Technology Group article (Feedstuffs, Aug. 4), feed mill automation systems have the ability to capture much more data than most feed mill managers have time to analyze.

While this is true, it should not stop managers from determining what data will have the most significant impact on feed safety, feed quality, shrink and profitability.

Feed mills routinely analyze data. For example, feed mills that manufacture medicated feed are required to review production data and determine if there are significant discrepancies between the theoretical and actual inclusion levels of medications. However, based on my personal experience, I was only looking for significant deviations in the batching process versus identifying trends or unnatural events in the manufacturing process. Furthermore, feed mills might review only the production summary of multiple batches versus individual batch production.

The use of statistical process control (SPC) during the feed manufacturing process improves quality parameters such as nutrient guarantees or pellet durability and reduces manufacturing costs, e.g., shrink and energy consumption (Herrman, 2002).

SPC uses a number of different charts to analyze the data. The two most common charts are the individual/moving range chart and histogram.

The moving range chart is used to plot the individual measurements, mean and the difference between sequential points in a process. The data also are used to calculate the mean difference, as well as the upper and lower control limits, which reflect the variation in the system based on the current process.

The second chart, the histogram, is a graphical presentation of the data based on the frequency of an observation and can be used to determine if the distribution of the data appears to be normal. The addition of predetermined specification limits to a histogram will allow the feed manufacturer to calculate the Cpk and Cp, which are capability indices that indicate how well a system meets predetermined specifications.

The first time I heard these SPC terms, I was intimidated by the concept, but as I learned how SPC could be used to identify design and process problems, I began to understand the value it has in the batching process.

The most common application of SPC in a feed manufacturing operation is the analysis of the automated batching system.

To better illustrate the application of SPC in a feed manufacturing operation, let's use the example of salt addition through a major scale in 10 batches of feed (Table). The call amount for each batch of feed was 24 lb., which was weighed on a major scale with a 1 lb. resolution.

The actual amount of salt added for 10 batches of feed as well as the differences between the call and actual amounts were calculated in terms of the actual amount (in pounds) and percentage.

While the average over-addition of salt for the 10 batches was only 0.7 lb., the range of the under and over percentage was -8.3% to 12.5%. A feed manufacturer should have a target specification of +1-2% for each batch of feed, which, in this example, indicated that the system was not performing at industry standards.

Presenting the data in a graph also can help illustrate the errors in the batching process (Figure). The lower and upper specifications were set at +1 lb., which is +4% of the call amount. The specification was 0.24-0.48 lb., but because the resolution of the major scale was only 1 lb., the specifications could not realistically be set any narrower.

The data and corresponding results were calculated and presented in a simple spreadsheet that most feed manufacturers have on their computers. Analyzing and plotting the data, along with setting specification limits, can provide the feed mill manager with insightful information.

Managers should look for trends in the data that indicate either continuous over- or under-addition of an ingredient or high variation between the call and actual amounts. Batching data that indicate a consistent over- or under-addition of an ingredient or between the call and actual amounts are indicators that the automation system does not have the correct batch parameters.

There may well be a host of explanations as to why this does not occur, but the most common problems may be that the salt was weighed on a scale with 1.0 lb. increments, the diameter of the screw conveyor was too large, the fast and slow cutoffs were not set correctly and/or the jog time setting was too long.

Correcting these errors can usually be accomplished by communicating the resolution of each scale to the nutritionist, purchasing a smaller-diameter double flight screw and installing a variable-frequency drive on the conveyor motor, respectively. The cost of not adding enough of an ingredient will result in poor animal performance, whereas the over-addition of ingredients will result in ingredient shrink.

While some computer automation systems now come with SPC software built into the system, very few feed mills routinely utilize the results to correct batching errors. Small differences between the amount listed on the master formula and the actual amount of ingredients weighed on the scales can create a significant inventory deviation over a one-year time period.

The next article will look at the most common problems in batching system design and manufacturing processes that create both natural and unnatural variations in the process.

 

Reference

Herrman, T. 2002. Statistical process control: Techniques for feed manufacturing. Kansas State University Agricultural Experiment Station. MF-2507.

 

Salt addition through a major scale in 10 batches of feed

 

Call

Actual

Variation,

Variation,

Batch

amount, lb.

amount, lb.

lb.

%

1

24

23

-1

-4.2

2

24

23

-1

-4.2

3

24

25

1

4.2

4

24

27

3

12.5

5

24

27

3

12.5

6

24

22

-2

-8.3

7

24

24

0

0.0

8

24

24

0

0.0

9

24

26

2

8.3

10

24

26

2

8.3

Average

24

24.7

0.7

2.9

Standard deviation

1.8

1.8

Statistical process control in feed mill

 

Volume:86 Issue:35

Farm receipts show reversal of fortunes

Farm receipts show reversal of fortunes

THE net income situation for livestock and grain producers has made nearly a complete reversal over the last three years, with the U.S. Department of Agriculture's Economic Research Service (ERS) projecting higher livestock receipts and lower crop receipts.

USDA expects more favorable price forecasts for crops and livestock for 2014, reflecting more optimistic expectations relative to forecasts made in February. Many of the livestock categories are now anticipated to benefit from record annual average prices in 2014.

In its 2014 "Farm Sector Income & Finances" report released Aug. 26, ERS projected that livestock receipts will increase by more than 15% in 2014 due to a 21% increase in dairy, a 20% increase in hog and a 15% increase in cattle receipts.

Dairy farm businesses are forecasted to experience a 69% increase in average net cash farm income in 2014, with higher milk prices and lower feed expenses expected compared to 2013.

Despite lower output from beef cattle farm businesses due to a reduced herd size, higher prices for cattle and calves are expected to result in 15% higher beef cattle receipts. This will more than compensate for production cost increases driven by increased livestock purchases, leading to a 28% expected rise in average net cash farm income for beef cattle farm businesses in 2014.

With hog prices projected to rise, average net cash farm income for hog farm businesses is expected to increase 24% in 2014.

Driven by increased receipts, average net cash farm income for poultry and egg farm businesses in 2014 is forecasted to be up 28% from 2013.

Crop receipts are expected to decrease 7% ($15.2 billion) in 2014, led by a $12.8 billion decline in corn receipts.

ERS economist and report author Mitch Morehart said there has been a run of years that favor crops and then a run of years that favor livestock production. Volatility also continues to be linked to global income both for inputs and output.

Pat Westhoff, agricultural economist and director of the University of Missouri's Food & Agricultural Policy Research Institute, added that there has been an "incredible reversal of fortunes" in just two years' time.

Westhoff noted that the livestock industry has enjoyed abnormal profits this year, and one rule of economics is that those won't last. "I would expect to see livestock prices come back down as we adjust to new economics," he said.

For crops, he said future prices and profitability will depend on what kind of supply response occurs domestically and around the world to change the current price incentives. Weather also will play a major role in crop supplies.

 

Regional impact

Farm receipts show reversal of fortunes
The ERS report acknowledges a great deal of regional diversity, driven by concentration of production. Morehart said the largest increase in average farm income is forecasted in the Northern Crescent, including the Upper Northeast, Wisconsin and Michigan, due to the strong dairy profits expected in the region (Map).

Declines for corn farm operations will contribute to the expected 16% decrease in average net cash income for Heartland farm businesses. Likewise, projected declines for mixed grain, wheat and corn businesses will contribute to the 15% decrease in average net cash farm income in the northern Great Plains.

The largest decline (27%) is shown in the Mississippi Portal region, where lower prices for soybeans, cotton and rice will greatly overshadow the much smaller share of livestock receipts in the region.

Expected gains in poultry and hog receipts are driving the higher projected average net cash farm income in the Eastern Uplands (9%) and Southern Seaboard (4%).

 

Production costs

Total production expenses are forecasted to increase $14.2 billion in 2014, continuing a five-year upward trend. Morehart said lower feed costs are the biggest contributor to the rising livestock profitability.

After several years of increasing expenses, livestock farm businesses across all specializations are expected to benefit from a 2.7% decline in feed costs. Feed expenses make up, on average, 45% of cash expenses for dairy, 29% for hogs, 30% for poultry and 20% for beef cattle farm businesses.

Livestock and poultry purchases account for the largest portion of the increase in total expenses, at $5.4 billion (a 22.6% increase over 2013 purchases). Other components that contribute to the increase to a lesser degree include fuels and oils (up $1.0 billion), repairs and maintenance (up $1.1 billion), total labor expenses (up $1.4 billion) and miscellaneous expenses (such as animal health and breeding expenses, contract production fees, irrigation water and general production and management expenses, etc.).

The three major crop-related expenses — seeds, fertilizer and pesticides — are expected to increase a combined $2.3 billion (3.5%) in 2014. Prices are up for all three inputs. Fertilizer prices have risen 17% since the beginning of the year and, although they will fall off during the second half of the year, are expected to remain above last year's level.

The forecasted number of planted acres in 2014 is up 2.4% from 2013. The planted acreage increase, coupled with a projected 3.6% increase in fuel prices, is responsible for the expected rise in fuel expenses.

Volume:86 Issue:35

Farm credit showing cracks

Farm credit showing cracks

AS commodity prices continue to creep lower, farmers are tightening their belts, according to several new reports that suggest that the pattern is expected to continue at least through the rest of the year.

The Federal Reserve Bank of Kansas City, Mo., representing the 10th District, recently released its quarterly "Survey of Agricultural Credit Conditions for the Tenth District." The survey found solid credit conditions in the second quarter of 2014; however, longer-term concerns about credit quality have begun to emerge.

Additional reports for other Fed districts found similar results, which are attributed to the lower commodity prices that are reducing farm income.

Although bankers in the 10th District reported very few past-due farm loans, they also noted that loan repayment rates have weakened since last year, particularly in crop-producing states like Nebraska. Credit standards changed little, and bankers indicated that funds were available to satisfy a sharp rise in loan demand.

"Despite continued strength in the livestock sector, district farm income remained well below year-ago levels due to falling crop prices and poor winter wheat yields," the report notes. "Cropland values generally held at high levels, while strong demand for high-quality pasture pushed ranchland values higher. With summer rains easing drought conditions, the potential for record crop production this fall could keep prices low and shrink profit margins further, potentially affecting future debt repayment capacity."

Farm credit showing cracks
The U.S. Department of Agriculture released its latest national and state-level farm income and wealth statistics Aug. 26, revealing that net farm income is expected to be $113.2 billion in 2014, down about 14% from the 2013 forecast of $131.3 billion (Figure). The 2014 figure would be the lowest since 2010 but is still $25 billion above the previous 10-year average.

As expected, lower cash receipts for crops and, to a lesser degree, higher production expenses and reduced government farm payments were the reasons for the drop in net farm income.

Net cash income is predicted to be $123 billion, down almost 6% from the 2013 forecast. Net cash income is projected to decline less than net farm income primarily because it reflects the sale of more than $10 billion in carryover stocks from 2013.

"While past profits and crop insurance may help mitigate shrinking margins in 2014, financial stress for crop producers could mount in 2015 if net returns do not improve," the 10th District report notes. "In addition, should a large fall harvest keep prices low through the beginning of next year, crop insurance might not provide a comparable level of revenue protection in 2015.

"Looking forward, loan quality may become more of a concern beyond 2014 if repayment rates come under additional pressure from declining profit margins," the report adds.

The Federal Reserve Bank of St. Louis, Mo., recently disclosed similar information for its own Eighth District, but in addition to farm income shrinking, farmland values in the Midwest and Midsouth also continued to decline.

"Slightly more than half of respondents reported that farm income had decreased in the second quarter of 2014 compared with the same period a year earlier," the Eighth District report notes. "However, the current index did surpass bankers' prior expectations reported three months earlier."

Looking ahead to the third quarter, the St. Louis Fed suggested that farm income levels will be lower than a year earlier, as will household and capital equipment expenditures.

The Federal Reserve Bank of Chicago, Ill., reported that bankers in its Seventh District expect non-real-estate agricultural loan volumes — especially those for operating loans (and even for feeder cattle loans) — to increase in the third quarter of 2014 relative to the same quarter of 2013.

"Volumes for farm machinery and grain storage construction loans were forecasted to fall in the July through September period of 2014 relative to their year-ago levels," the report says.

Survey respondents generally anticipate farm real estate loan volumes to be lower in the third quarter of 2014 than a year earlier. Bankers from the Wisconsin area, however, expect higher farm real estate and dairy loan volumes than in 2013 due to dairy farming profits.

"The rate of growth in farm assets, debt and equity is forecasted to slow in 2014 compared to recent years," USDA explained. "The slowdown is a result of expected lower net income, higher borrowing costs and moderation in the growth of farmland values."

As a result, the value of farm assets is expected to rise 2.3% in 2014, while farm sector debt is expected to increase 2.7%, which is still a noticeable reduction in average annual growth for each of these measures compared with the last 10 years.

"Nonetheless, the historically low levels of debt relative to assets and equity reaffirm the sector's strong financial position," USDA concluded.

Volume:86 Issue:35