Abstract
Sustainable feed formulation (defined here as nutritional and economic feed optimization) is substantial in feed chain production from crop farmers to livestock producers. Diet formulation employing a static linear programming (LP) approach, which is widely used in trading firms and feed production facilities, does not allow for intertemporal flexibility. Our approach allows the interaction between feed components over time, considering the volatile global feed prices, thereby improving sustainability in feed formulation and feed availability. The objectives of this study were to (1) develop a multi-stage LP feed model, (2) demonstrate its potential use in broiler feeding, and (3) illustrate the impact of feed input price spread (variation) on the composition of broiler diets. Modeling resulted in reciprocal relationships between conventional feeds and byproducts at different rates. Based on the price spreads expressed as a percentage of DDGS (distiller’s dried grains with solubles) price compared to corn price, three positions of dietary switch were identified; corn-DDGS price spreads of higher than 94%, between 76 and 94%, and lower than 76% corresponding to limited/no inclusion, partial inclusion, and maximum replacement of corn by DDGS, respectively. Rapeseed meal inclusion was 4, 5, and 6% in the corn-based starter, grower, and finisher diets, respectively, and its potential to replace soybean meal was limited by its higher fiber content. Based on the simulated compound feed prices, the global broiler feed industry could gain 1.7 billion USD through improved resources planning.
Highlights
The global compound feed industry production is estimated at 996 million metric tons and is valued at 450 billion USD in 2015
Based on the price spreads expressed as a percentage of dried grains with solubles (DDGS) price compared to corn price, three positions of dietary switch were identified; corn-DDGS price spreads of higher than 94%, between 76 and 94%, and lower than 76% corresponding to limited/no inclusion, partial inclusion, and maximum replacement of corn by DDGS, respectively
Studies show that the Alqaisi et al Agricultural and Food Economics (2017) 5:25 replacement of some feed ingredients with agro-industrial byproducts would lead to a reduction in feed costs and lower greenhouse gas emissions per unit of output (Alqaisi et al 2014)
Summary
The global compound feed industry production is estimated at 996 million metric tons and is valued at 450 billion USD in 2015. The poultry compound feed industry itself accounts for 463 million metric tons or 47% of the global industrial feed production (Alltech 2016). Feed costs account for up to 70% of total costs in typical livestock production systems (i.e., intensive dairy farming, (Alqaisi et al 2011) and up to 69% in intensive poultry production systems (Donohue and Cunningham 2009). The rate of inclusion of these byproducts should depend on their market prices and the price difference between the conventional feeds and the byproducts. Whatever the inclusion rates of various feed ingredients in the poultry diet, a lower cost diet will significantly reduce the cost of poultry production and/or more profitability of feed producers
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