In times when pig production is more profitable an owner of an enterprise invests money in feeding; he is concerned about the high protein content, buying different additives, which make the quality of feeds better, etc… As soon as the money are over the farmers start saving on feeds, excluding everything “unnecessary”. Feeding costs are 40-60 % of all production costs. So this cost item must be analyzed and optimized.

If we stand up for profitability and cost effectiveness we have to know exactly where we are with the results about feed conversion, daily gains and how to improve them. At this point all producers ask the same question: “How can I be sure that additives, said to be productive, are effective indeed”. To sort out you must count and think. Whatever additive you decide to use, you have to calculate costs per 1 ton of feeds. Next step is to distinguish what minimal improvement of results the additive should give to recoup itself, to state so called breakeven point. And only after that — what return on investment you can expect for.

For example let’s analyze the efficiency of additives usage in growers’ diet. For example the farmer decides to invest in acidifier. It costs him €10 per 1 ton of feeds or € 0.50 per head. Such decision will recoup itself when daily gains increase by 1.43 g/day (feed conversion ratio is improved by 0.003). Researches and experiments prove that acidifier can increase daily gains by 14 g/day (feed conversion ratio is improved by 0.05). Therefore the expected return on investment is 1:10, in other words €1 invested in the enterprise can give €10 profit. And this is a considerable profit indeed.

Considering that agricultural goods market becomes more unsteady efficient farmer must think not only about decreasing feeds expenses, but also how to increase feeds effectiveness, when calculating the nutrition economics of his farm. Any changes in pigs ration must be an investment and must be calculated from the point of view of breakeven and potential return on investment.

Franz Waxenecker, Master of Agricultural Business and Economics Pig nutrition and nutrition of young animals leading consultant, Director of Development Department of Biomin Company

You can read more in magazine publication “Profitable pig production”, № 1, September 2010 р.