farmgate: Lower Feed Costs And Increased Feed Value May Be Available From New Generation DDGS.
Ethanol-blended fuel at the gas pump is sold as a higher octane motor fuel, and now some of the distillers’ grain co-products from ethanol refining are being sold as a higher value livestock feed that could have marked benefits for pork and beef producers who feed it. Just like burning super regular in your engine, feeding a “super regular” DDGS feed to your livestock may provide better performance that will pay off at market time.
The advent of ethanol production throughout the Cornbelt has not only increased the demand and value of corn, but also provided a feed alternative for the livestock industry. Distillers’ Dried Grains with Solubles (DDGS) have been sold at a lower price than corn, but have had their limitation in the amount than can be added to a feed ration. That provided some help over the past two years as the price of corn doubled, and the price of soybean meal nearly doubled. Iowa State University economist Jacinto Fabiosa directs the research at the Food and Agricultural Policy Research Institute (FAPRI) at the Center for Agricultural and Rural Development. He says the use of DDGS is governed by the proportion livestock feeders use, which depends on pricing, as well as the maximum amount an animal can digest, and how much corn and soybean meal can be replaced by DDGS. His analysis focuses on the latter, but evaluates the nutrient content in traditional DDGS versus the nutrient content in a new generation of DDGS called “Dakota Gold.” The new product is priced 2.11% above the traditional DDGS.
The benefit of the new generation DDGS has 39.9% higher metabolizable energy, 5.7% more crude protein, and 19-58% higher specific amino acids, which are more digestible than in the traditional DDGS product. Compared to a corn-soybean meal ration for hogs, Fabiosa says the inclusion of traditional DDGS in the ration is $0.29 per cwt of feed lower than the base ration or 2.6% which would save $2.17 per head in feed costs.
Use of the new generation DDGS product, which was included in the swine ration at a maximum 20% rate, would replace 18.54 lbs of corn and 4.59 lbs of soybean meal in a 100 lb. feed ration. The cost is $1.08 lower than the basic ration or 9.88% which saves $8.13 per head in a feeder-finishing operation. Fabiosa says there are a couple limiting factors, compared to the base diet of corn and soybean meal. He says there is a surplus of the amino acid threonine and available phosphorus, but a need for added lysine. Based on the content of the new generation DDGS, 20 lbs of it would replace 18.54 lbs of corn and 4.59 lbs of soybean meal.
Fabiosa says the price of DDGS will parallel the price of the feed ingredient that it primarily replaces, either corn or soybean meal, and he says the results of his analysis is that it will track both of them. But he says DDGS prices will be based on corn prices until the new generation DDGS product is more widely available, and then it will be more closely priced to soybean meal. Currently, a traditional DDGS product will save pork producers about $2.17 per head in feed costs, and $8.06 per head if the new generation DDGS product is purchased. One additional benefit of the new generation DDGS product is an unwinding of the debate over the food, feed, and fuel trade offs that go along with biofuel production.
Summary:
A higher quality of distillers’ dried grains not only contains more beneficial nutrients for livestock rations, but may be more digestible than traditional DDGS products. Of great importance is the added savings in feed costs for pork producers that can occur with the use of the new generation of DDGS, which could exceed $8 per head.
Posted by Stu Ellis on September 29, 2008 12:39 AM to farmgate