In the last 5-6 years, the managing partner of New Horizon Farms has focused on reducing the amount of corn used in all diets fed in the 14,000-sow, farrow-to-finish system, headquartered in Pipestone, MN.

With traditional diets, Taubert figures it took 10.2 bushels of corn to get a pig to market weight — and that includes the corn allocated to sow, gilt developer and nursery diets. Last summer, he slashed corn usage by nearly 70%, down to just under 3 bu./finished pig. Current levels have settled in around 4.7 bu./hog marketed.

“That’s our total corn usage divided by the pork we’ve sold per year,” he explains. “The difference is using other ingredients to replace corn.”

Taubert began targeting corn when grain prices, corn in particular, began escalating. Armed with over a decade’s worth of feed intake and growth curve data from the New Horizon Farms’ research farm, the four, 1,200-head finishing barns allocated solely for that purpose, all feed ingredients and feed processing procedures were on the table.

Also in 2006, Taubert began cultivating a working relationship with Cargill Animal Nutrition, tapping into their Optimum Value Supplier database (OVSdb), which analyzes and tracks nutrient values of feed ingredients used in swine diets (see sidebar, page 18). He utilizes the firm’s AutoCalc program with the full nutrient profile, factoring in digestibility coefficients to ensure pigs are capable of utilizing a dietary ingredient without sacrificing performance. AutoCalc also uses “net energy” values vs. “metabolizable energy” values more commonly used in building swine diets.

Taubert reinforces the importance of net energy values by pointing to the 2009 corn crop, which in southwestern Minnesota registered 11-12% lower-than-normal net energy values. The energy shortfall sent him looking for dietary alternatives.

Nutritional Partners

In addition to the Cargill Animal Nutrition consultants, New Horizon Farms has a unique relationship with the swine nutritionists at Kansas State University, who oversee all research projects and trial protocols. Research barns are equipped with the FeedLogic feeding system, which tracks feed usage by pen. Each research barn also has a pen scale where each pen of pigs is weighed every two weeks.

“We have four trials running at all times. With the FeedLogic system, it is relatively easy to generate large volumes of performance data,” Taubert says.

Cargill nutritionists take the real-world research data and combine it with the relative nutrient values generated from the AutoCalc and OVSdb programs to formulate diets.

“We’re not really feeding anybody’s feed (brand). We don’t buy their branded base mixes or vitamin/trace mineral products, so they are more nutritional consultants and partners in this process,” Taubert explains. “Their formulations are based on how our pigs have responded to certain diets and factor in ingredient pricing. We reformulate diets whenever we deem it is necessary.”

Focus on Feed Costs

With nutrient values known and updated regularly, a portion of the dietary ingredients become interchangeable. Much as added fat can replace a percentage of corn, distiller’s dried grains with solubles (DDGS) and bakery byproducts provide an alternative energy source to do the same.

“Least-cost diet formulation may not give you the best performance, but judicious best-cost formulation should not sacrifice performance,” he emphasizes. “Our early focus was on finishing diets, because that’s where the bulk of the dollars are spent.”

Taubert remembers a more-or-less simultaneous look at DDGS and the particle (micron) size from their feedmill as the first attempts to reduce feed costs and/or improve performance. “We began by taking a closer look at energy sources simply because it’s the easiest (and most predominant) ingredient in pig diets,” he notes.

Energy alternatives included various fats (choice white grease, animal/vegetable [A/V] blend or beef tallow), bakery byproducts and other feed grains. His experience with bakery byproducts and DDGS was limited at the time.

“DDGS seemed to be an element that we were going to have to learn to manage, so we began running trials,” Taubert explains. The goal was to learn whether existing data on the impact of DDGS on pig performance was applicable to New Horizon Farms’ system and whether their source of the ethanol byproduct matched those results. Cargill’s OVS database, which includes sampling of over 100 ethanol plants, reveals a wide range in DDGS net energy values. New Horizon Farms buys most of the DDGS from a single plant, but nutrient values are continuously tracked, nonetheless, as the variation from a single source may still be significant.

From a practical standpoint, Taubert is uncomfortable with DDGS inclusion rates higher than 30% of a finishing diet. “Push it higher than that and you will probably get some carcass quality issues. I think the data is pretty sound on that,” he says.

In 2009, Taubert began experimenting with bakery byproducts to offset a portion of the corn in finishing diets. “Bakery byproducts, like a lot of other energy sources, trade relative to corn. It is generally higher in energy value, but there is variability. So, the question becomes — what is the relative value of bakery byproducts compared to corn?” he points out.

Any price advantage is usually slim, but when the energy value of the 2009 corn crop in his area fell 12% short of normal corn, Taubert turned to bakery byproducts because the energy content was relatively stable.

As the diet formulations change, Taubert is constantly on the lookout for any indications that a dietary ingredient is affecting carcass quality. “We push the envelope, but we also understand that different ingredients not only affect pig performance, they may also affect carcass quality. We work closely with the packer to remedy any quality concerns that surface,” he notes.

Fineness of Grind

Again, calling on his nutritional resources, Taubert also challenged the traditional thinking about feed processing and again turned to KSU and Cargill nutritionists for advice on what could be done to improve feed conversion. Recognizing that grinding or rolling corn to a finer particle size provides more surface area for the digestive enzymes in the pig’s gut to break down and capture the nutrients in the feed ingredients, fineness of grind became another focal point.

Instead of grinding corn to traditional 750-800-micron particle size, they tightened down the roller mill to kick out 400-micron corn. The roller mill company was consulted to ensure they had the correct rolls and the right combination of grooves to accomplish the fineness target. Mill operators were equipped with a set of sieves and the KSU protocol to spot- check particle size.

Key concerns were feed flowability, which Taubert sees as strictly a management issue, and whether the incidence of ulcers would increase.

There was no uptick in ulcer occurrence, so the unanswered question was whether corn ground to 400 microns would yield a comparable feed conversion as diets with added fat. The goal was to trim the amount of corn needed as an energy source and to avoid giving the pig more energy than it needs (regardless of source) to optimize lean gain and to sustain life, he explains.

“Our average daily gain data shows a 1.95-lb./day average, feeder-to-finish, from 60 to 275 lb.,” he says to reinforce that the finer grind has not depressed feed intake, nor grossly increased the incidence of out-of-feed events. “I think if there is a cost benefit there, you’re going to get it by virtue of the pig having better performance; you’re not going to get it in the form of a diet-cost reduction,” he adds.

In addition, grow-finish lean gain efficiency has improved from about 2.9 to 2.5 pounds of feed per pound of gain in the last half-dozen years.

Taubert estimates that each 100 microns finer has a value of $1.00/pig feed conversion advantage. “But, there comes a point where you’ve met the energy requirement of the pig and it cannot utilize more. Anything over that point, you are just wasting money.” And, he cautions, there is a point where finer particle size could create management challenges. If the feed doesn’t flow properly — creating out-of-feed events — the $1.00/pig advantage could disappear pretty quickly. “A guy’s got to be careful to not push too far,” he adds.

Taubert has added cones in all bins to improve feed flow and prevent bridging. “Try to avoid dumping new feed onto old feed, an important precaution to avoid out-of-feed events, and clean bins with each turn of the barn,” he advises.

400-micron Sow Diets, Too

“Once we found that we didn’t have significant issues with finer particle size in finishing, such as ulcers, we got comfortable pretty quickly that it might work out okay on the sow farms, too,” Taubert notes.

“Sows are able to process and utilize the energy out of 400-micron corn better than corn rolled to 800-1,000 microns. We’ve looked at the sow diet formulations and it’s almost like 400-micron corn is a whole different ingredient than 1,000-micron corn. It gets a different credit in the diet,” he says.

Because the finer grind creates a more dense diet, sow managers collect feed samples from several drop boxes in a row to determine how much variation exists. “We don’t want to under- or over-feed sows, so we try to set them in the middle of the variability of the box readings. If a 4-lb. setting really drops 4.3 lb. with the more dense diet, we make that adjustment,” he notes.

Sow managers check drop box settings once per quarter or when there is a significant diet change. “Last fall, we adjusted the box settings because the 2010 corn crop rolls better, more consistently and is a lot heavier,” Taubert explains.

Sows’ energy requirement is expressed in kilocalories/day (Kcal/day). Because the finer grind allows sows to get more Kcals from the same amount of corn, they have actually reduced the total feed usage on the sow farms without sacrificing sow condition or productivity.

Sow condition is determined by a backfat measurement taken on every sow just after weaning. Over 500 sows are measured every week, all read by the same technician. “Based on her backfat reading, the drop box is set to get each sow back to optimum condition by the time she goes back to farrowing,” he explains.

“It takes a little bit of time, but since we’ve collected this data, our sows are in better condition and, like everyone else’s, our productivity has improved,” he says.

The corn in lactation diets are rolled to 400 microns, and sows are fed ad libitum. “If a sow can eat as much as she wants and has a good source of high-quality water, her milking ability will improve by what she is able to process herself. I think it is clearly highly correlated with her condition coming out of the farrowing room,” he adds.

Zero to 5,600 acres

Prior to 2010, New Horizon Farms purchased all of their corn needs. But that all changed when two sizable landowners approached Taubert about leasing their productive cropland in southwestern Minnesota.

Faced with the opportunity, in typical, analytical fashion of his civil engineering training, he figured he could negotiate and manage the inputs for growing a corn crop much as he has done for the dietary ingredients for raising pigs.

“I looked at the opportunity and said: ‘OK, here’s what I think the range of corn prices will be — anywhere from $3.00 to $7.00/bu. Granted, we probably won’t spend that much time at $7.00, outside of a major weather event happening, but we probably won’t spend much time at $3.00 either.

“In the ‘old days,’ the range was between $1.80 and $2.60/bu. — an 80-cent spread. At 10 bu. of corn to finish a pig, that’s an $8 move. Best-to-worst, that’s the most corn was ever going to cost you. Today, if you figure it will require 8.5 to 10 bushels of corn or its alternatives (DDGS, bakery by-products, etc.) to finish a pig, since everything is relative to corn, and the range is $3 to $7/bu., that’s a $4 spread, which puts you at $34-40/finished pig. That’s over four times the variation, and you’ve got less time to pick where to buy your corn.

“So, if I can grow corn consistently at the lower quarter of that $3 to $7 price range — barring any major weather event, which is what crop insurance is for — and if I get an opportunity to buy the rest of my corn needs in that bottom quarter, it gives me a lot more days to sell the hogs at the margin I want to achieve,” he reasons.

“I have great custom growers, so it didn’t seem like that big of a stretch for me. I believe it’s another strategy that offers some flexibility because I know that I have ‘X’ number of bushels harvested, I know where it’s at, and I know what it cost me to grow it. I can somewhat control that price — I can’t control the grain market.”

Taubert had secured all of New Horizon Farms’ corn needs for 2011 before the 2010 crop was in the bins. With that harvest behind him and three more years left on their four-year lease agreement, he feels secure that any corn raised will be competitive with the market. That’s five years with a good portion of his corn needs covered.

“Clearly, the ethanol policy is going to change. Yields will increase. We’ll have natural variation in the market. And, although it doesn’t seem like it today, we will see $3.50/bu. corn again at some point, although it will take a big crop,” he says. “If you look at the charts, nothing has increased and stayed there. Yes, corn jumped from $1.80-2.60 to $3-something, then to $7-something, but I felt this was a time period where we needed to control some of our production costs.”

Innovation Required

“I think the traditional corn-soy diets are long gone,” he continues. “At a minimum, we are going to be forced to use DDGS going forward. We have been pretty aggressive in trying to change things, to break the norm.

“The point I am trying to make is not to leave the impression that many producers are feeding 10 bu. of corn per finished pig and I am feeding a little less than half that. That’s not the case. It’s more about how the industry needs to be pretty innovative, to change as quickly as we can and as much as we can feel comfortable with, so that our changes will manifest itself in some sort of performance improvement while reducing our costs,” he
concludes.