Feed Prices are A-Changin'!

Dr. Joanne Knapp, Principal Technical Consultant, Fox Hollow Consulting, LLC, Columbus, OH 

I expect that this will be my last Buckeye Dairy News contribution for a while, as Dr. St-Pierre has returned from his sabbatical leave and will take up this topic again.

It’s no surprise to anybody in the feed or livestock industries, but feed prices are changing rapidly this fall.  Compared to August 2010, the average price of feedstuffs used for this analysis has stayed the same, but individual feeds have changed prices dramatically.  Whole cottonseed has dropped $100/ton and is now predicted to be breakeven.  Canola has gone from being overpriced to a bargain.  These ingredient price changes are impacting nutrient values.  The NEl is up 3 ¢/Mcal to 12 ¢/Mcal, while metabolizable protein is down 20 ¢/lb to 27 ¢/lb.  Non-effective NDF and effective NDF are relatively unchanged from August.  The cost of the key nutrients was estimated using Sesame III software and break-even prices of commodities and forages used in dairy rations were predicted (Table 1).  Note that because market conditions are fluctuating substantially from week to week, these evaluations are good only as long as the relative price differences hold true.

Based on early October wholesale prices for central Ohio, feed commodities fall into three groups:

The usual caveats with Sesame III™ results apply.  You cannot formulate a balanced diet using only the feeds in the Bargains column.  These feeds represent savings opportunities and can be utilized in rations to reduce feed costs within limitations for providing a balanced nutrient supply to the dairy cow.  Prices for commodities can vary because of quality differences as well as non-nutritional value added by some suppliers in the form of nutritional services, blending, terms of credit, etc.  Feeds may also bring value to a ration in addition to their nutrient value, e.g. tallow as a “carrier” and dust suppressant in vitamin/mineral pre-mixes and molasses as a source of sugars. 

The detailed results of the Sesame III™ analysis are given in Table 1.  The lower and upper limits give the 75% confidence range for the predicted Break-Even prices.  Feeds in the “Appraisal Set” are either those that were completely out of price range (outliers) or had unknown prices, such as the alfalfa hays of different nutritional quality. 

Table 1.  Prices of dairy nutrients, and actual wholesale, breakeven (predicted)
and 75% confidence limits for feed commodities used on Ohio dairy farms.