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CORN IS BACK

This month Nutriflash gives a nice example of the value that creates a regular and consistent optimization of our diets. Last month, all ingredients prices were going in the same direction which led us to keep similar diets as the ones proposed in August. But this month, Corn and Wheat do not follow the same trend and oblige us to make new arbitrations to define the most economical formulas.


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The most significant event of this month is the reduction of Corn (and Corn gluten feed) price by 15 Euros per ton (-9% for the Corn) while Wheat and Barley prices slightly increased by 5 Euros. On the down side we find Canola meal and Sunflower meal that saw their prices lowered by 4%.


The diagram below illustrates well the impact of the ingredient prices increase of each diet (column in blue). The change of ingredients prices were actually detrimental for all our diets except for the duck Grower feed. In Orange, we illustrate the savings generated by this month optimization. There was significant for Broiler diet (-2.1 Euros) and Duck diet (-2.3 Euros) and help to keep the overall cost of these diets at a lower cost than last month (in yellow).


But for the Pig segment, the savings was negligible (in orange) and could not prevent to overall diet cost to increase (+2.4 Euros for Pig Fattener and +0.6 Euros for Gestating Sows - columns in yellow).

Both Broiler and Duck diets fully benefited from the reduction of Corn price. Corn is replacing wheat and becomes the main ingredients for both diets. Sunflower meal situation is improving as well and gain space by replacing SBM. It is important to notice as well that the Canola meal is entering our Duck diet.


The picture that we are presenting with an increase of +30% of Corn over a period of just one month is obviously theoretical. In practical terms, we recommend not to increase the contribution of an ingredient by more than 15% from one month to another. Indeed, abrupt changes in diet composition oblige animals to adjust their enzymatic pool which may take few days. For nutritionist, it should therefore take several rounds of optimization to capture the entire savings that we presented in this document.



The situation for Swine is very different compared to Poultry given the lower interest of Pig in Corn. There is no change in the Pig Fattener diet and we had no way to absorb the additional cost of 2.4 Euros coming from the increase of Wheat and Barley prices. For the Gestating Sow, we absorbed a quarter of the increase through our optimization but not enough to prevent the diet cost to increase by 0.6 Euro. But we can see in the formulas above that the Corn and Palm Oil is now entering in the diet while Canola Grain is removed.


For the Dairy cow, Corn Gluten Feed is strongly entering our formula at directly 23.1% in replacement of the Wheat and SBM that went down respectively to only 3 and 1.1%. But this major change brings only a saving of 0.3 Euro. Is it worthwhile to make such a change for only 0.3 Euro per ton? That is an arbitration that each of you will need to take according to your economical and competitive context.





These diets have been prepared with the support of Mg2mix - FRANCE


using ALLIX3 formulation software technology from A-systems - FRANCE


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