Several years ago, I read a report by a major international bank specialising in the agro-industrial sector, in which it was predicted that in the very near future the pig production chain (from the pig producer to the consumer) will be made up of only three vital partners: pig producers (genetics and commercial), slaughterhouses, and retail stores. Everything else would be auxiliary or even not necessary at all.
So, what about nutrition?
It was claimed that the current nutrition suppliers for premixes, additives, supplements, concentrates, complete feeds, and even those trading straight ingredients would have to adapt or leave the picture altogether. That was shocking at the time, considering nutrition makes up at least 60% of the cost of raising a pig to market weight.
But, why are nutrition suppliers not going to be vital for the future of pig production? Simple.
Pig producers will take nutrition into their own hands, buying only what they truly need and mixing for themselves what needs to be mixed. And, at a fraction of the cost! Nutrition suppliers will become like ‘supermarkets’ where producers will be buying straight ingredients (be it vitamins or additives or feedstuffs) to mix at their own facilities. Indeed, most major suppliers of additives prefer to sell directly to producers, by-passing the traditional nutrition company of the past.
But how are producers going to afford in-house nutrition? The answer is in the scale of economics employed today and predicted for the near future. As pig producers grow in size and financial means, their dependence on outside nutritional support diminishes steadily. At a certain point, the scale of production is such that nutrition becomes an in-house responsibility and it is used as a cost effective production tool!
In my experience, since then and especially during the last year, in combination with the current financial crisis worldwide, the prediction has come to become true 100%. And what is even more interesting is the speed by which producers, regardless of size or location, start thinking of ways to decrease feeding cost by taking matters into their own hands.
But, why leave to outsiders something that affects at least 60% of your bottom line? Only time will tell…