Winter 2023 - Profitability & Economics F - Flipbook - Page 11
Nutrition
Ultimately the farmer has a choice to make on whether they can manage the asset and skillset required to
own and operate a feed mill. When we look specifically at on farm mills compared to toll mills and what
that means for Feed Cost/lb of gain we can piece some of that out from our benchmark data. In the below
chart you can see that the majority of producers with the best Feed Cost/lb of Gain have on farm feed mills
(highlighted). I think important to note that having an on-farm feed mill is not a guarantee of being a low
cost producer and outside factors like pig health, nutrition, and management all can and at times do have
superseding effects on the cost of gain.
As we have studied this over the years it has become apparent that owning a feed mill in all generality has
been beneficial for those that invested the equity on such a project. To compliment this, Pipestone Nutrition
has begun a new service offering for feed mill management. Which is aimed at allowing farmers to own the
Feedmill without some of the headaches (labor, time, expertise) of operating them while also allowing for
some efficiencies of scale to own the facility with other producers. They are very similar to a managed sow
farm where the sows and real estate are owned by the farmers and Pipestone provides the management. This
model, though in its infancy, does appear to have similar benefits from a cost savings perspective to the end
user. It also allows smaller farmers that don’t have the expertise, labor, time to operate and own their own
mill to work together with other producers in a larger, more efficient mill that’s operated and managed by an
outside entity (Pipestone).
For farmers to continue to be competitive we believe they will need to continue to own and control the assets
from the land – sows – barns – feed mills – harvest facility – retail chain. Whether you can do this on your own,
with a partner or an outside expertise, then becomes the decision. Though a managed feed mill may not be
the right choice for all, I do think it’s an option for those willing to, and able to invest further into the value
chain.
www.pipestone.com
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