Techno-Economic Analysis of Near-Infrared (NIR) Systems at Feed Millsas a Low-Cost, High-Speed Alternative to Feed Ingredient Testing

Abstract

Improperly balanced diets not only impact the quality of animal production but also the profits of a livestock operation. Typically, the nutrient and chemical content of feed ingredients and forages are determined using well-established wet chemistry tests. However, these tests can be expensive and time-consuming. Moreover, the increasing use of various by-products which are known to have large variations in chemical and nutrient content warrants a real-time on-site feed and forage testing system. Near infrared (NIR) spectroscopy systems are quick and effective on-site testing tools. While NIR systems are being adopted for on-farm or at feed mill ingredient and forage testing, little is known about the economic impacts of such an investment for a livestock or feed mill operator. This study developed a baseline model and an Excel based spreadsheet application for performing Return on Investment (ROI) analysis to determine the feasibility of using an on-farm or at feed mill NIR testing system. ROI was calculated based on the nutrient cost saved or spent determined from the difference of estimated nutrient content and actual calculated value. The findings from this study will promote low-cost alternatives for onfarm or at feed mill ingredient testing, positively impacting quality of animal products and minimizing costs.