Spend smart in the swine barn

University of Guelph computer program pinpoints profitable investments in the finishing barn

BY TOM BUTTON

Every pork producer knows that there must be ways to earn a better margin from the finishing barn. Everyone can always be more efficient. The tough question is: Where do you start?

University of Guelph swine scientist Kees de Lange says a lot of producers are putting effort into strategies such as phase feeding and split-sex feeding when they would get a faster and higher return from focusing on feed quality and herd health.

De Lange has set up his Leantec II computer program to rank the economic opportunities for finisher operations. (See Where to Start.) For these calculations, de Lange plugged in the following costs: weaners at $55, varia ble costs including vet bills at $15 per head, corn at $130 per tonne, soymeal at $310, and premix at $600 per tonne, with a $15 mix cost.

In addition, de Lange figured on five-per cent feed wastage, feed intake of 95 per cent of NRC rates, a one-per cent mortality, and enough variability in growth rates to lead to a 14-day delay in shipping from the time the first pig reaches market weight until the entire lot is ready for slaughter.

Every barn and every different set of genetics will have different base numbers, de Lange says: "We can talk all day about whether the numbers I'm using are representative." Still, the trends are so striking, they likely apply on most farms, and farmers who have their doubts should develop their own computerized simulations.

His first finding is that health status has an even greater impact on profitability than many finishers realize, de Lange stresses. Overall, doing a better job of disease prevention is the No. 1 profit opportunity for many farms.

The model showed a herd with low health has a 30-per cent lower lean growth rate, 12-per lower feed intake, and maintenance energy requirements that are eight per cent higher than for a herd in excellent health. Those inefficiencies can hurt the herd even more than the two per cent higher mortality.

The situation isn't much better in herds with mediocre health status. Lean growth rate is still cut by 20 per cent, with feed intake six per cent lower, maintenance energy requirements four per cent higher and mortality one per cent higher than in high health herds.

Depending on current health status, de Lange found, disease control will save from $12 to $22 per pig place per year.

While most growers are already trying to do a top job of shipping at ideal final body weights, de Lange found it will be possible to get a better margin by doing an even better job. "A couple of kgs really affects your bottom line," he says, with typical savings ranging from $7 per pig place for farms shipping hogs that are too light, to $6 per pig for those shipping too heavy.

Even more important, de Lange believes, is to reduce weight variability. He recommends growers get the PorkMa$ter computer program, available through the University of Guelph web site, and use their annual reports from Ontario Pork to calculate their own standard deviation (STD). About two-thirds of marketed pigs will be within the farm's STD.

"It's even more important than shipping at optimum weight," de Lange says. Shaving two kgs from STD variability has the potential of earning the grower an extra $9 per pig place per year.

Lean growth rate is crucial, too. In Ontario, it ranges from 300 to 425 grams per day. Key factors include genotype, health status and environmental conditions.

There are even larger savings possible with simpler steps, however. Better feed preparation is foremost. Feed that's ground to a fineness of 650 microns, compared to the average 1,250 microns, is eight per cent more digestible and offers significant improvements for growth rates and feed conversions.

Producers can also save money by ensuring that feed mixes are accurate. If lysine, for example, is 10 per cent above target one day, it's a waste of a purchased input: Feeding lysine at higher than optimal levels won't help rate of gain. The following day, if lysine is 10 per cent below target, the result will be poor herd performance.

De Lange's computer numbers are mixed for phase feeding. Barns that go from single-ration to two-phase feeding can expect a $6 per pig place improvement in their bottom lines. Going from two-phase to three-phase, however, should net only an additional $3. And going from three to four will return an extra $1.50.

Each step will boost profits by half the preceding step, de Lange explains: Going from four phases to five will earn a mere 75 cents. "I've been on operations in the West where they change rations every week," de Lange says. "Going from six rations to 12 rations will earn only 15 to 30 cents a pig....It shows that some of us are putting our efforts in the wrong area."

The same follows for split sex feeding. With an average $3 improvement to the bottom line, it may help a farm's profitability, but only slightly. Other areas have more potential for savings, and so should get a larger share of management effort, including health status, shipping strategy and feed quality.

De Lange is confident that the computer models are valid, and that "there's real money, real profit at the end of the day." Those profits, he believes, will come to growers who identify the areas with the greatest profit potentials: "Simple things like feed particle size are much more important than a lot of the fancy stuff we like to talk about."

© copyright 1999 Agricultural Publishing Company Limited.


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Quebec questions

Last month, Farm & Country's Robert Irwin traveled to Quebec with a group of Ontario producers to get an inside look at the province's ASRA stabilization program

Intrigued by a growing number of reports touting Quebec's pork industry's Assurance Stabilization des Revenues Agricoles (ASRA) program, a group of Ontario producers crammed into a rented 15-passenger van late last month and navigated the roads of La Belle Province determined to separate fact from fiction.

In their quest, which took them from farm kitchen to corporate boardroom, the group discovered that ASRA, a pillar of the Quebec industry, is doomed, but everyone agreed Ontario producers can learn from the Quebec industry.

Like everyone else on the trip, Ontario Federation of Agriculture provincial director Margaret Boys was struck by "the working together, the friendliness and the openness" Quebeckers showed.

Boys says after learning first-hand about the structure of Quebec's packing industry, which involves 10 abattoirs owned by seven organizations, and about Quebec's round table, which brings everyone associated with the industry together, she's convinced Ontario needs more packers and greater industry co-operation.

Not that Quebec is a packer-producer love-in, however. The group heard Gaston Wolve, a farrow-to-finish operator who farms near St. Alexis, about 40 kilometres east of Montreal on Quebec's north shore, complain that the Coopérative Fédérée-owned-Olymel, which is responsible for about 56 per cent of provincial hog slaughter at its three plants, has too much power.

He loves ASRA but is opposed to large integrators participating in stabilization. He admitted, however, that if integrators were to leave the program, "there would be a lot of producers to pay back."

Quebec industry officials now project ASRA could go into the red by $500 million before producer premiums restore it to a surplus position over the next two years.

Ontario producers wondered whether there are opportunities to work with Quebec in marketing all pigs from eastern Canada as one pool. "I think a joint market would work well but I don't know how well Bouchard and Harris would work together setting up the deal," quipped Mike Savage, a 65-year-old farrow-to-finisher who also cash crops about 150 acres near Lacolle, 100 kilometres southeast of Montreal along the New York border.

Savage, who lost $40,000 to $50,000 in a Porcine Reproductive and Respiratory Syndrome flare-up last year, concludes Quebec producers have fared better than any others in North America during the price downturn. He is a strong proponent of the provincial stabilization program. "If you can get one, grab it," urged Savage.

In a remarkably candid, no-holds-barred, six-hour session, Quebec pork board director André Auger revealed he has no objection to pooling hogs with Ontario but he warned the group it's time Ontario got its act together. Auger, who is also a purebred breeder and executive member of a variety of swine organizations including Canadian Swine Breeders Association, recalled his former life as a packer representative in the days when Quebec producers were permitted to deal directly with packers.

"Each producer believed his contract was better than his neighbour's but they were all the same," Auger recalls. He says large integrators who received an extra $12 per pig were the only ones benefiting.

When pressed for his assessment of the Ontario industry, Auger, who farms near Yamachiche, about 100 km east of Montreal on the north shore of the St. Lawrence River, observed that Ontario producers aren't united. He warned that prevents them from standing up to packers and government.

Auger was also critical of some Ontario Pork directors he's met, suggesting some have such a small stake in the industry they wouldn't meet eligibility requirements to serve on Quebec's pork board. "Elect yourself strong representatives; it's the only way you can go forward," he advised.

Auger said the Quebec round table works because participants are willing to put whatever pressure is required on errant members. He recalled the case a few years ago of an integrator who failed to respect the round table. The integrator saw his sales of farmstead equipment and feed dwindle. "Within a short time his representatives were out on the roads bringing gifts to producers," and he was co-operating again, Auger recalled.

The Ontario travelers barely fitted into the modest meeting room in the former Catholic seminary on a back street in Saint-Hyacinthe, which serves as headquarters of Olymel, Canada's largest pork exporter. There, Olymel's vice-president Serge Bonneau told the group: "We think the less packers there are the better it will be for producers."

Bonneau reasons competition between packers gives chain stores too much bargaining power.

Olymel, like all Quebec packers, receives some allocated hogs, which the day before the visit cost the company $1 per kg. To maintain its allocation the company is still forced to buy a percentage of its pigs from the Quebec auction where on that day the price was $1.35 per kg.

Bonneau calculated Olymel paid an average $1.10 per kg for Quebec hogs that day. At the same time Olymel also brought in pigs from Ontario under a two-year contract with Ontario Pork at a cost of $1.07 per kg plus $0.10 per kg for trucking.

Quebec producers are expected to deliver pigs to the closest abattoir at no charge. They are compensated for any extra distance if the board directs the hogs elsewhere.

Bonneau said that because the Quebec marketing system maintains his plants at capacity, driving down slaughter cost per hog, he can pay more for hogs and still successfully market fresh pork in Ontario below prices charged by Ontario packers.

Mario Maillet, general manager of du Breton, a vertically integrated processor near Quebec City, was a lone voice seeking the right to deal directly with producers. Du Breton, which also owns Genetiporc, a genetics supplier recently franchised in Ontario through Premium Pork, has production contracts with producers across the Maritimes.

The company is boosting slaughter from 13,000 per week to 18,000 to pursue growing New England niche markets for their "natural SPF pork." Maillet reasons du Breton needs a close relationship with those who meet the company's exacting specifications.

The last stop on the whirlwind tour took producers to Montreal's south shore community of Longueuil and a spectacular view of the St Lawrence River and Montreal skyline from the modern office tower that houses the Union des Producteurs Agricoles, Quebec's powerful general farm organization. All Quebec commodity groups maintain offices in the building and work under the UPA umbrella.

Pork board manager of sales and transport Pierre Gelinas showed off the booking area where four headset-equipped employees fielded producer calls. Gelinas also explained the modern computer room that producers can access by modem to get grading results from the previous day.

Despite the apparent sophistication of Quebec's allocation system the visitors found Ontario and Quebec boards use the same means to project hog volumes - truckers.

"They know everything that is going on," Gelinas assured.

© copyright 1999 Agricultural Publishing Company Limited.


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Will Quebec stabilization survive?

World trade regulations have ASRA advocates thinking of another "belle" solution

They say that all good things must end. The Assurance Stabilization des Revenues Agricoles (ASRA), the Quebec stabilization program envied by many pork producers across North America, is no exception - but not for reasons of poor execution.

"I am convinced that ASRA will be nonexistent within two years because of world trade rules," predicts Quebec pork board director André Auger. In anticipation, the Quebec industry is drafting a succession plan, and early reports are that Quebec producers may yet have a way to let the good times roll.

Throughout the pork crisis, ASRA has ensured Quebec producers receive their cost of production. That figure has been set at $137 per hog based on negotiations agreed to between government and producers. Producers pay premiums representing one-third of the cost. Government pays the rest.

One challenge is to find a way to ensure producers receive their cost of production while avoiding the appearance that any payout is made on a per-hog basis. Auger and other Quebec industry officials feel that could be achieved by using a whole-farm approach.

They would use the current Net Income Stabilization program, which allows Quebec producers to pay in up to four per cent of net income, Auger says.

"What's important for producers is it will be based on cost of production," explains Pierre Gelinas, manager of sales and transportation for the Quebec pork board.

The board wants to raise allowable producer contributions from NISA levels to as much as nine per cent. They argue the plan would meet trade requirements because pay-outs would be calculated on whole farm cost of production rather than on a per-hog basis.

The cost of production would be based on a model farm developed by the Quebec industry and probably reviewed every three months. Gelinas says ASRA will remain during a seven-year phase-in to whole farm coverage, scheduled for completion by 2006.

Money, not trade, remains the major hurdle. "It's a lot like plumbing material," quips Union des Producteurs political economist Charles Gagné. "You can have the most beautiful taps and sink, but if there's no water the system won't be effective," Gagné says.

Quebec producers are still reveling over last fall's blockade of Highway 20 east of Montreal, which triggered a massive government cash infusion for ASRA. Most producers, however, realize the provincial election, underway at the time, was a factor in the producer victory.

Russell county producer Robert Perras has been touting ASRA at producer meetings across the province. He learned of the change of ASRA's fate for the first time during a recent Ontario producer tour of Quebec that he organized.

But Perras is far from discouraged. He came away from the tour with a renew-ed vision of prosperity for the Ontario pork industry. "We were looking for a stabilization program. Now we see how we can make one work," he concludes.

© copyright 1999 Agricultural Publishing Company Limited.


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Shearing lamb stress

Research at the Lethbridge (Alta.) Research Centre is measuring the stress levels in sheep induced by a variety of management practices. The research has wider implications, especially for the beef industry, as previous studies indicate stress can have a significant negative impact on production.

"Stress can cause a wide range of problems," says Dr. Gerry Mears, an animal physiologist at the centre, "ranging from appetite changes to immune system and reproductive problems, plus dark-cutting meat and increased carcass shrink. At high levels, stress can lead to reductions in productivity and carcass quality."

The researchers studied changes in the levels of four hormones - cortisol, beta-endorphin, T3 (triidothyronine) and T4 (thyroxine) - in response to standard management practices such as tail docking, castration, weaning, isolation and restraint. Scientists have long known that stress can lead to increased output of such hormones. Neither T3 nor T4 levels were affected in the Lethbridge tests, but cortisol and beta-endorphin levels rose measurably during some of the experiments.

Restraint (mimicking shearing) resulted in slight increases of both hormones for a short period. During weaning, beta-endorphin levels remained constant whilecortisol rose slightly for the first 60 minutes and 24 hours later. The study also measured isolation stress. In partial isolation, lambs could smell and hear other lambs, but not see or have physical contact with them. In total isolation, all contact was removed. Hormonal response was higher during visual and physical deprivation.

Tail docking within 24 hours of birth produced no change in either beta endorphin or cortisol levels, though Mears suggests naturally high levels of the hormones at birth may mask the stress of tail docking, as research with lambs between two and six weeks of age found elevated cortisol and beta-endorphin levels.

Castration produced the most elevated hormone levels. Both were elevated within 15 minutes of surgery, with beta-endorphin peaking at that time and cortisol peaking at 60 minutes and remaining elevated 24 hours after castration.

In sum, reports Mears, the physical stress of "castration had a much greater effect on beta-endorphin and cortisol levels than the psychological stresses of weaning, isolation and shearing restraint." Of the psychological stresses, isolation elevated hormone levels most, followed by restraint and weaning. - R. Charteris

© copyright 1999 Agricultural Publishing Company Limited.


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Bagel bonanza

Waste not, want not. It's a truism as far as University of Minnesota sheep researchers are concerned. Recent research indicates that leftover bakery products, bagels in this instance, can provide a more-than-acceptable energy ration for lambs, resulting in gains similar to a corn-based diet.

The study involved 16 wether and 12 ewe lambs, assigned at random by weight to a control 13 per cent corn-soy diet and the experimental diet, in which half of the corn ration was replaced with ground bagels past their use-by date.

The control diet of corn-soybean meal was fed at three pounds per head per day; lambs on the experimental diet received 1.5 pounds of corn-soybean meal plus 1.5 pounds of ground bagels daily. Equal numbers of wethers and ewes were assigned to each pen for the 105-day trial; weights were taken weekly. The study was conducted twice.

The bagel-fed lambs initially produced looser stools than the control lambs, leading researchers to suggest a gradual introduction to the byproducts. Ultimately, there was no significant difference in daily gain for either the ewes or the wethers on the bagel-byproduct diet, though the bagel-fed animals slightly out-gained the corn-soybean meal lambs.

Feed conversion was similar for the control and bagel diets, with lambs on the bagel diet consuming 0.2 pounds less feed per pound of gain than the control group.

The conclusion? There's more than good coffee and concession scuttlebutt at the local Tim Horton's or Country Style. If stale-dated bagels are available at a cost less than corn, they could be an alternative energy source for lambs. - R. Charteris

© copyright 1999 Agricultural Publishing Company Limited.


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Checking on chicken

Production safety - and documented proof of it - drives poultry's HACCP

BY CHRISTINA SELBY

Poultry farmers in the Niagara region were introduced to the new On-farm Food Safety Assurance Program last month, one stop of many by Chicken Farmers of Canada reps across the country. The main thrust is making sure that chicken is not only produced safely, but that there is well-documented evidence of that fact.

The program - based on CFC's Good Production Practices Code and the basic principles of hazard analysis critical control points (HACCP) - was presented by David Fuller, chair of the food safety assurance design team, and John Slot, Chicken Farmers of Ontario's HACCP committee director. Fuller explained to attendees at the Smithville meeting that the program is still under development and that no practices are as yet carved in stone. "We're rolling this out across the country," said Fuller, referring to nationwide producer meetings scheduled to conclude at the end of March.

Nonetheless, CFC wants producers to run through the manual and forms and begin applying the practices. "We want to get producers on the program today," he said, adding that pinpointing difficulties during hands-on testin g will ensure the final form of the program doesn't hold surprises for producers.

The pressure for such a program is "coming from the people who buy our product," said Fuller. As for producers who don't comply with the program, "I don't know where they're going to ship their product." Processors have developed a Modernized Poultry Inspection Program in response to U.S. regulations that require domestic and imported chicken processors to operate under HACCP programs.

Compliance and co-operation from other sectors of the industry such as hatcheries, feed suppliers and catchers has caused concern among some producers. CFC has discussed the manual's third-party information requirements with suppliers, and while Fuller admitted that the road has not always been smooth, he insisted they'll be brought into line with the program.

General consensus at the meeting was that most manual requirements were common-sense, basic operational procedures. But compliance "will require some changes on every farm," said Fuller.

The manual sets out management practice under two categories: MDs or "must dos"; and HRs, "highly recommendeds." An example of an MD is that barns must be cleaned and disinfected at least once a year. The HR is that this procedure be undertaken between each flock, something many producers already do as a matter of course.

But it takes just one poor producer to bring unwanted scrutiny to the whole industry. "I had one producer say he only washed the bottom two feet of his barns," said Fuller. "When I asked him why, he responded that this was as high as the chickens go."

Creating a physical barrier between production areas and the outside world is critical to keeping problems away from the birds, said Fuller. Employees must be trained in disease-prevention procedures. A suggested example? A pair of boots for workers on both the "production" and "civilian" side of the operation.

Outside traffic such as feed deliveries should be restricted, said Fuller: "Ask suppliers what codes their employees follow." Buy feed from a mill with Good Manufacturing Practices, the manual suggests, and minimize the risk of feed contamination. Feed bins must be cleaned out once a year and emptied out between flocks. Another MD for feed is not accepting leftover feed transfers from other farms.

Producers must have a standby power system that is tested on a regular basis. Fuller emphasized that farmers "don't need pressure from media or animal rights groups" to add to the mix during an emergency.

But the manual's requirement for detailed record-keeping - as evidenced by forms in the manual covering everything from the date of the last feed tank clean-out to the outside temperature during bird catching and loading - presents farmers with a more arduous task. While keeping track of flock health, feed conversion and disease trends is common on Ontario's chicken farms, the level of detail requested on the 10 sample forms may seem to some like a whole extra job.

Aspects of the manual still under development include the requirement for annual water source testing. Fuller admitted that chemical analysis is an expensive procedure, but said bacteria levels need to be checked. He said he has talked to a couple of feed bin manufacturers who would be willing to put doors in to facilitate cleaning, adding "We have a company developing a high-pressure water cleaning system."

An evaluation sheet on the manual will be sent to all registered producers before the program is finalized.

© copyright 1999 Agricultural Publishing Company Limited.


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