Securing feeds supplies must be a priority for best value feeds, as KW Alternative Feed’s Colin Shepherd reports
Strong prices across most of the feed markets continue to put pressure on the supply of the best value alternatives. It means securing supplies for the winter should now be a priority, and in many cases is likely to be more important than waiting for possible dips in the market.
Soya bean meal prices remain above £280/t despite recent improvement in yield estimates for the US soya bean harvest, with some suggestions these latest figures are over-optimistic. The high prices reached by cereals this year are also predicted to cause a proportion of the global soyabean acreage to switch to corn when planting begins, undermining any good news about the current harvest.
With the Chinese economy starting to show signs of recovery, the next 12 months may also see an increase in global soya bean meal demand, further stretching supply. The result is that prices are flat right through to April 2011, although contracts for delivery next summer are currently available at a discount of around £20/t.
Pressure on rapemeal supply is also continuing, with overall yields down and the Canadian crop affected by poor weather during harvest. Prices hovering in the late £190s/t at the time of writing make rapemeal marginally poorer value than soya bean meal, so it’s no surprise demand for alternative feeds has risen quickly.
The same is true for energy feeds, with wheat prices in excess of £150/t ex-farm for September delivery, and some of the traditional alternative high-starch feeds like maize meal already sold out.
For those without full cover for winter feeding, there are two broad approaches that need to be taken from this point on, with a combination of both likely to be the best strategy in most cases.
Firstly, when better value alternatives are available get them booked up fast to secure deliveries right through to the end of winter – high demand means waiting until December or January is not a sensible option.
Secondly, for supplies of the main commodity feeds like wheat, soya bean meal and rapemeal, the lack of any premium on the spot markets suggests it’s worth waiting for the occasional dip in the market to book what’s needed. The current high prices are being exaggerated by involvement of the fund buyers, and any hint of the markets having peaked will lead to a rapid sell-off of their positions.
But those dips are unlikely to be large, given the serious pressure on overall supplies, so stay in close contact with your feed supplier, and look to make the most of any drop in price. Just bear in mind the best “dips” may only be £5-10/t.
In terms of the best value alternative feeds, pressed pulp and sugar beet feed are probably the best value energy feeds at the moment – new crop material is available from October onwards – and definitely a better buy than citrus pulp or soya hulls for digestible fibre at the time of writing. Even compared to wheat at £150/t ex-farm plus the costs of delivery and rolling, sugar beet feed at just over £150/t delivered is the clear winner.
For those able to use a moist feed, Traffordgold, Vitagold and brewers’ grains (draff) are also worth considering when available, with processed bread still a good value source of starch energy. And when a dry high-starch energy feed is needed, SweetStarch or a confectionery blend would be the best choice.
On the proteins front, the high price of both soya bean meal and rapemeal means many customers are achieving overall protein cost reductions by increasing the use of rumen-bypass proteins like SoyPass and ProtoTec. Although expensive for every tonne, both are more cost-effective alternatives for supplying the high quality bypass protein that usually comes from soya bean meal.
Coupled with a switch to molasses-based liquid feeds that also contain urea to supply the extra rumen degradable protein needed – Regumaize 44 is a good example – a balanced ration can often be achieved at a lower overall cost. Distillers’ feeds are also proving useful as a more cost-effective alternative to rapemeal, with a similar protein cost, but higher levels of rumen-bypass protein and 1MJ ME/kg DM more energy.
Finally, start to consider taking some cover for next summer. Prices for May onwards are at a discount, and good risk management would suggest that booking perhaps 25-50% of requirements for May-July is a sensible move at this stage.
However, remember that the last time wheat values, for example, reached such high levels, within a year the prices had dropped back significantly due to high plantings in the autumn and a good crop the following year.
* Prices correct at the time of writing, all prices quoted are for 29t tipped bulk loads delivered on-farm within 50 miles of origin. Prices subject to change.