Better Pork - June/July 2002Independence pays off for fast-growing Wallenstein
With a production capacity of 600,000 tons per annum, Wallenstein Feed and Supply Ltd is enjoying economies of scale while retaining the advantages of a small family businessby KEN BENNETT
When you walk out onto the roof deck atop Wallenstein Feed and Supply Ltd.'s Feed Mill number 2, in Wallenstein, Ontario the landscape spreads out before you in a panoramic display of cultivated land. Just 125 feet away stands a newer, high-tech mill capable of producing 300,000 tonnes of feed per year, helping to fill a four-fold increase in pork feed production since 1997. Run by only two employees per shift, its capacious green framework and sophisticated processing equipment stand in stark contrast to a team of horses in the distance pulling a manure spreader and hearkening back to an earlier way of life.
This vista helps Rick Martin gain perspective on where the roots of his family business lie and how it has gained market share while retaining independence. "In Ontario, in my opinion, the really strong mills are quite often independent family owned mills," he says.
Wallenstein's CEO since 1981, Martin has demonstrated that he is just as fit to lead his family business as he is to run up the dozen or so flights of stairs to the 100-foot perch above his facility for an early morning tour. Looking out over the first mill built by his father Lloyd in 1963 with a capacity of 30,000 tonnes of feed per year, Martin claims the business still has the same level of approachability it had when it was started in 1958 and customers can phone up and chat with the owner without interference.
1997 21,035 tonnes 1998 30,937 tonnes 1999 37,414 tonnes 2000 48,533 tonnes 2001 81,621 tonnes 2002 117,620 tonnes (projected) When the 275,000-tonne number 2 mill opened 25 years later, it vaulted capacity tenfold. Just over a decade later, with pent-up demand for feed output, a third mill was designed with a capacity equal to the first two combined. "What you try to do is remain a small business in the way you treat people, while enjoying the advantages of the efficiency of a really large company," Martin says.
Prior to the new mill opening in May of last year, output stood at 28,000 tonnes per month. Now the entire mill is now capable of producing more than 600,000 tonnes of feed per year, though with its present production of 35,000 tonnes per month, it is running at 70 per cent capacity. At that pace, Wallenstein could reach 420,000 tonnes this year, remarkable for single site production in Canada. Long established as a poultry feed supplier, it now counts pork feed as one quarter of its production. "There seems to be a trend away from the big corporations to the smaller community-based, family-owned feed mills," says Martin.
Martin believes farmers appreciate independence because that is what they expect in return. "They absolutely do not like somebody telling them what to do -- that you've got to buy these genetics and you have got to ship your pigs to this processor. They like to be their own boss and decide who they are going to buy from, what they are going to do with their pigs and how they're going to market them. We don't do hog contracting, we don't own any farms, we don't own any pigs. We've never tried to be more than just a feed mill," says Martin.
Staying outside the loop can also be seen as a risk. Martin suspects some large integrated chicken and pig processors, such as Maple Leaf, which also has a lot of feed mills, might use recent food safety initiatives such as HACCP (Hazard Analysis Critical Control Points) as an opportunity to edge out smaller feed mills. "I thought about three or four years ago that what they would do is quickly get all of their mills HACCP-accredited and then make a rule in their plants that they will only kill HACCP chickens and pigs, and then freeze the rest of us out. So I said, 'Well, we're going to get there before they do."
In December, all three mills on the Wallenstein site were accredited, the first feed company in Canada to receive a multiple designation on a single site. "What we're attempting to do is to have a very lean company without many layers of management," he says. "The advantage is we can react very quickly to things."
In-house nutritionists give Wallenstein mills greater potential
For an independent feed company to break away from the large corporate mills that once franchised them and compete successfully against them for market share, the key step, according to Wallenstein CEO Rick Martin, is acquiring nutritional expertise.
"At one time, everybody worked with a big feed mill like a Purina, a Shur-Gain or a Master Feeds to get their formulas given to them and to buy what they call a supplement, maybe half the feed. If you were going to make 1000 kilos of feed 30 years ago, you might have had to buy as much as half of that feed from your supplier," he says. "It was a time when the big corporations had the edge in expertise."
Martin credits his father, Lloyd, for breaking out of that mould, going directly to vitamin and mineral premix suppliers such as BASF and hiring their own on-staff nutritionists. "He was one of the first people to get his own nutritional capability so he could make the feed from the ground up and distance himself from the large feed suppliers," he says. "We would be as competent as they were and what they're left with is a higher cost structure."
Janet Schell is a nutritionist who worked for BASF Canada when it began encouraging mills to build formulations from the ground up. "We would offer a five kilogram inclusion, you add your grains, protein sources, fat, limestone, dicalcium phosphate and salt and we would tell you how to put it together," she says. "Independent mills all around Ontario and other parts of Canada were able to still make a good margin per tonne of feed, but the total cost to the farmer was reduced." Now employed by Wallenstein for the past 10 years, she works with four other nutritionists in developing their own formulas which require an inclusion rate in finished feed of only one to two kg.
"Where we made inroads first was in our starter feed for pig nurseries," says Schell, who also manages the swine sales team. "Producers are getting better at knowing their bottom line because we've gone to systems like All In-All Out. Whether you are a 1000-head finishing barn or you've got 400 nursery pigs, you can track them exactly. They're weighed beforehand, the feed is all weighed and you know their weight going out, so you can really measure their performance. That's really been to our advantage because we are selling performance and bottom line."
"I would guess 95 per cent of the mills in Ontario don't have a nutritionist to this day," suggests Martin. "There are all sorts of different variations of hog and dairy feeds, and you just can't do that (produce them all) if you don't have your own nutritional capability." With three full-time staff nutritionists, Wallenstein offers 900 different formulations.
The simultaneous HACCP (Hazard Analysis Critical Control Points) accreditation of all three mills in just three years was largely due to the available nutritional expertise at Wallenstein. Amber Swidersky is a nutritionist and the quality assurance co-ordinator in charge of putting together the HACCP program. "When I talk HACCP, I'm talking about human health," she says. "Our producers are demanding feed from HACCP-accredited mills, especially in the swine industry."
Having developed a 62 Standard Operating Procedure (SOP) binder, Swidersky is able to outline every function at the mill, including verification that procedures are met. She describes the HACCP program as a sort of devil's advocate asking, "Can I cause any contamination at any of my processing steps?" If the answer is yes, it can lead to a critical control point that gets much more attention.
"Our number one critical control point would be medications in the feed," she says, noting that by properly sequencing each manufacturing step, most risk of contamination is eliminated. "Certain products can't be made after a product with a medication that could cause a problem," she says, "For instance, you make a pig starter feed with penicillin. They would never make pig finisher ration after that. If by accident they do, every day those records are verified by somebody else, it gets caught and the feed gets recalled."
"Within the next year or two, farmers are going to have to follow the very same rules that feed mills do regarding use of medications and good manufacturing practices," Martin says. "I think to some degree farmers like to offload those responsibilities to the feed mill, where you have trained nutritionists that can look after those sort of things for them."
Warehousing on wheels - the key to low storage costs
When you want to see grain storage, you look for bins or silos. But not at Wallenstein Feed and Supply Ltd. There you look for trucks, lots of them. That's because when Rick Martin came home to run the family business, he brought a lesson with him from his former employer, General Motors -- just-in-time manufacturing."We have virtually no storage of anything here," he claims. "We always have enough that we can get through a long weekend and that's about it."
By warehousing on wheels, the Wallenstein site is deceivingly small compared to similar scale feed mills with drying and storage facilities. "It just costs money to store ingredients," Martin justifies. "Our ingredients are stored on our trucks all day long as our drivers bring it back."
"We've got close to 700 tonnes of finished feed storage on our trucks," says Jeff Van Driel, operations manager at Wallenstein. He is responsible for the logistics of scheduling their own trucks as well as the 15 per cent of trucks representing wholesale customers. "For return loads, we've also got that as far as storage but we only bring between 50 and 65 per cent of our own ingredients back to the mill." He says it is better for the rest to return empty when feed deliveries do not synchronize since other freight companies can fill in the needed flexibility, offering economical rates as well.
Rather than expanding mills into other regions of the province, Wallenstein seeks efficiency through centralization. "Most people think it's cheaper to truck feed from geographically diverse mills," Martin proposes. "We've found the main cost of trucking is loading and unloading, not driving down the roads." Fuel amounts to 22 per cent of the total cost for Wallenstein's fleet of 24 trucks. When diesel prices rose 50 per cent, from 40 to 60 cents per litre, trucking costs only increased about $1 per tonne. "Fuel cost is not as important as many people think," says Martin.
For Martin, optimizing the number of employees seems is more important than saving fuel. He points to the Hutterite settlements in Western Canada as his working model. "As soon as they hit 125 people, they split into a new colony. Once you get above that magic number, it's very hard to work together as a family or as a unit," he says. "We've actually now hit 100 employees and I still know everybody, and we all know what everybody else is doing and what's going on. We've been willing to incur a slightly higher cost of trucking to get rid of a whole layer of management. We maintain a better level of quality because we're making all the feed at the same location." With the increasing prevalence of loop production, Martin believes producers who make their own feed are up against similar complexity in feeding multiple sites. "Let's say that you've got one sow barn, two nurseries and 10 finishing barns," he says. "Are you going to put up 13 mix mills or are you going to buy yourself a feed truck? It gets more cumbersome for the big operators to do this." Using 40 drivers to operate their 24 trucks 16-18 hours a day makes delivering to areas such as the Niagara region very efficient. With 10 trucks in the area every day "you can afford to pay a fair price for it and still end up with the corn back at the mill at a good price."
Pelleted feed has also made new inroads for Wallenstein in hog farms to the west. "Generally, you get an improvement in feed conversion by pelleting feed," says Janet Schell, a Wallenstein nutritionist. She describes better digestion performance coming from two things -- an optimum particle size (650-700 microns) from milling and gelatinization of starch during conditioning. "With on-farm feed manufacturing, you need a slightly higher particle size to allow the mash to flow through the system," she says. "In a pellet, you can have an optimum particle size and still have it flow."
When ingredients are mixed together before pelleting, they are put through a conditioner, adding heat and moisture using steam. "That's where gelatinization of the starch particles happens," she says. Martin says the high temperature is also beneficial since it kills any bacteria that might be in the feed, such as salmonella. "The farmer get the advantages of a pelleted feed delivered for a pretty low cost," claims Martin, "extremely close to the cost of making a mash feed on his own." BP
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Strategies to help reduce nutrient excretion in swine manure
Proper processing of feeds and reducing feed wastage can help reduce excretion of nitrogen and phosphorusBy JANICE MURPHY
The three most expensive components of a swine ration are nitrogen (N), phosphorus (P) and energy. Nitrogen and phosphorus are also the most significant contributors to pollution from swine manure, so it is important to maximize the efficiency with which these nutrients are used.Excretion of N and P in swine manure can be substantially reduced by a number of different strategies, depending on individual farm situations. The most promising and practical of these strategies focus on two main principles -- minimizing input and maximizing the efficiency of utilization.
Improved productivity is the most obvious strategy for reducing nutrient excretion. It has been suggested that for each 0.1 unit improvement in feed efficiency, there is a three per cent decrease in N output. Over the past 20 years, the feed efficiency of pigs growing from 25 kg to market weight has gradually decreased from approximately 4.0 to less than 2.85 in top-producing herds (Coffey, 1996).
Proper processing of feeds is one way to positively limit nutrient excretion through improvements in feed efficiency. Pelleting of feeds has been estimated to improve feed efficiency by 6.6 per cent and subsequently reduce N excretion by five per cent (Wondra et al., 1995). Feed additives that promote growth may also reduce excretion of N and P as a result of a better feed efficiency. In addition, improvement in herd health status will lead to improvements in feed efficiency and thus reductions in mineral excretion. Keller (1980) estimated that converting to a specific-pathogen-free herd health status can improve feed efficiency by as much as 10 per cent and, as a result, decrease N excretion by 10 per cent.
One of the simplest, yet most overlooked, ways to minimize nutrient excretion is by reducing feed wastage. Research in this area has estimated that feed wastage can range from two to 20 per cent, with typical operations at five to six per cent (Gonyou and Lou, 1998). A two per cent decrease in feed wastage can lower N and P in manure by approximately three per cent. Feeding pelleted rations, paying particular attention to feeder design and adjusting feeders properly are some of the ways to limit feed wastage.
Phase and split sex feeding. As the liveweight of a pig increases from 30 to 110 kg, the concentration of amino acids and P in the feed decreases. The introduction of one or more additional phases for grower-finisher pigs will help more closely match amino acids and digestible P in the diet to the requirements of the animal, resulting in less N and P excretion.
Split sex feeding can also decrease excretion of N and P. It is well known that barrows eat more, grow faster, are less feed efficient and yield lower carcass lean than gilts. Although there is little difference between barrows and gilts up to 25 kg, differences in feed intake and growth rate may be as high as 15 per cent during the finisher phase. Because they eat less feed and have a higher lean growth rate, gilts require higher levels of amino acids and other nutrients than barrows. Different diets can be fed to match the nutrient requirements of the separate sexes more closely, while limiting excesses and reducing excretion.
Using amino acids to replace protein. Protein is an expensive nutrient in pig diets, so maximizing the efficiency of protein and amino acid utilization is important. Diets containing amino acids at minimum requirement (for maximum lean growth) with minimal excesses is critical. An experiment using chemically defined diets containing amino acids as a sole source of dietary nitrogen showed that, with a near perfect amino acid balance, a 15 kg pig is capable of converting 87 per cent of its absorbed nitrogen above maintenance to carcass protein. This does not mean that each of the 23 amino acids found in dietary protein are used at 87 per cent efficiency for protein (some are used more efficiently, others less).
Feed ingredients are combined to meet the pig's requirements for the most limiting amino acid. As a result, the protein content of the diet is higher than required because of the presence of excess amino acids. For grower-finisher pigs, the greatest improvements in the efficiency of N utilization can be achieved by improving the dietary amino acid balance, so that the diet more closely reflects the true balance in which amino acids are required. Through manipulation of the dietary amino acid balance, N excretion in manure can be substantially reduced -- by 35 per cent in grower pigs and 20 per cent in finisher pigs -- without affecting animal performance (Tuitoek et al. 1993).
Synthetic amino acids are often added to swine diets. L-Lysine-HCL is the most commonly used, and DL-methionine is used in some diets. Recently, synthetic L-threonine and L-tryptophan have become commercially available. The ability of the swine industry to use competitively priced synthetic amino acids efficiently is limited by our knowledge base of amino acid requirements of pigs and of biological availability of amino acids in feed ingredients (Coffey, 1996). At their current cost, it does not make sense to include synthetic amino acids, other than lysine, in grower pig diets, but this will change as the availability and price of tryptophan improves (deLange, 1997).
Phytase. No discussion of nutrient management would be complete without mentioning phytase. The most important anti-nutritional factor in swine nutrition, as it relates to nutrient management, is phytate. Approximately 60-80 per cent of the P in feedstuffs is present in the form of phytate, a compound that pigs do not use well.
Bioavailability estimates of P in corn and soybean meal for pigs range from 10-30 per cent (Kornegay, 1996). This low availability of phytate P poses two problems for producers -- the need to add inorganic P supplements to diets and the excretion of large amounts of P in the manure.
Phytate P must be hydrolyzed by an enzyme, phytase, into inorganic P before it is available to pigs. Research has proven that phytase added to the diet can improve P digestibility. As a result, the total P levels in the diet are reduced, the efficiency of retention is improved and excretion of P into the environment decreased (Table 1). In addition, feeds supplemented with phytase for grower-finisher pigs and for pregnant sows may need little or no supplementary feed phosphate. Currently, the addition of phytase does not appear to add more cost to the diet because it is offset by the savings associated with reducing P and Ca in the diet.
Table 1: Estimated excretion of nutrients by pigs without and with phytaseAssumptions for 113 kg market hog (birth to 113 kg):
Excretion per market hog:
- 320 kg of feed/pig
- 88 per cent DM, 15.5 per cent CP (2.48 per cent N), 0.5 per cent total P in diet
- 85 per cent DM digestibility, 50 per cent N retention, 45 per cent P retention
Excretion for hogs marketed in Ontario (5,000,000):
- 42 kg DM [320 x 0.88 x (100 - 0.85 = 0.15)]
- 4 kg N [320 x 0.0248 x (100 - 0.50 = 0.50)]
- 0.9 kg P [320 x 0.005 x (100 - 0.45 = 0.55)]
Phytase feeding and reduction in P fed:
- 1.6 million metric tons of feed fed, 210,000 metric tons of DM excreted
- 20,000 metric tons N and 4500 metric tons P excreted
- A 0.1 per cent unit reduction of P fed and the feeding of 400-500 units/kg of microbial phytase would result in 1600 metric tons less P excreted (1.6 million metric tons x 0.1 per cent) or a 36 per cent reduction in P excreted
Adapted from an example: Kornegay, 1998
Table 2: Impact of nutritional strategies on nutrient excretion
Strategy Used Reduction in nutrient excretion Improving feed efficiency 3 per cent for every 0.1 unit in improvement Reducing feed wastage 1.5 per cent for all nutrients for every 1 per cent reduction Matching nutrient requirements 6-15 per cent for N and P (Phase and split-sex feeding) Formulating on nutrient availability 10 percent for N and P Ues of highly digestible feeds 5 per cent for N and P Low protein diets 9 per cent for N for every 1 per cent (amino acid supplementation) reduction in dietary crude protein Feed processing (pelleting) 5 per cent for N and P Phytase 25-50 per cent for P Low-phytate corn 35-40 per cent for P Adapted from: can Heugten and van Kempen, 2001 In summary, there are many nutritional strategies available to swine producers that will have an impact on nutrient excretion (Table 2). The simplest and most cost-effective methods include reducing feed wastage and split-sex or phase feeding. Other strategies, such as adding phytase and replacing protein with amino acids, are effective at reducing excretion of N and P, but these methods are also likely to increase feed costs. BP
Janice Murphy is Swine Nutritionist with the Ontario Ministry of Agriculture, Food and Rural Affairs in Fergus. E-mail: janice.murphy@omafra.gov.on.ca
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Don't forget --- your pigs need clean water, too
The bottom line is that if the water is not fit for people to drink, it's probably not fit for your pigsby KEN PALEN
Whether for pigs or for people, clean water is an essential element of life. Pigs, in particular, consume on average three to four times the weight of water for every one part of feed, by weight.
It would be great if all wells produced sparkling, clean water straight from the ground or water lines, but this is often not the case. The fact that water is sometimes held in holding tanks before use to compensate for periods of high demand can also affect water quality and make checking for water quality important.
For those of us old enough to remember hogs wallowing in the waterhole, playing and drinking at the same time, we may think this whole water issue is overkill. We may also remember the neighbours who drank water from a dug well located in the barnyard with a manure pile nearby and lived to be over 90 years of age.
In fact, during a trip to a livestock fair just outside Mexico City, I witnessed men who worked all day with the livestock. They got up in the morning, took a bath in the open water trough and then drank that water all day, along with the livestock they tended. They were all as healthy as can be, but I ended up being ill for two weeks, just by putting ice in my drinks.
Of course, things have changed now. Pigs and people have different immune system tolerances and environments are now more sterile than they used to be, especially for the very young. Sow crates are washed super clean. So are many nurseries, which are operated on an all in all out basis, and in many cases, disinfectants are used to kill germs.
So why is all this background information important? Especially in farrowing crates and nurseries, we need clean water. By clean, I mean free of bacteria, like E-coli. What is the use of checking the pH of the water, buying a lot of acids to put in it and adding costly medication to the feed, if we are watering the piglets with the E-coli or something else?
To solve this problem, we may need to do what almost every other town does and that is add a little chlorine to the water. If people drink water that has a pH of 7 to 9 and live to be over 90 years old, then why all of a sudden, do pigs need a lower pH? I suspect there is more to the story.
Without trying to become a water expert, I would suggest that we sample water at the source, and also where the pigs consume it, for nutrients and E-coli coliforms, and maybe even salmonella.
If the water sample is high in iron or minerals that can cause build-up in the water lines, then cut a line open, stick your finger in and see if there is a lot of slime build-up. Deal with it as needed so that it does not become a place for germs to grow.
Maybe this will require the flushing of the lines with citric acid to clear the slime off periodically. Maybe hydrogen peroxide mixes can be used to do the same thing or maybe just some chlorine will work.
The bottom line is that if the water is not fit for people to drink, it probably is not adequate for your baby piglets to drink either, so a couple of samples may help you, your veterinarian and your nutritional advisor eliminate one more variable in pig production.
Oh, and by the way, - this pertains to new wells, too. Even though your new well supplies water at 20 gallons a minute and it looks good, it may be wise to test it for both minerals and germs before you spend the money buying all the pumps, etc. and treatment equipment. You may find that when you pump the water into your new heated floor lines and boilers, it may ruin your equipment and even create digestive problems for your pigs and employees because minerals, such as sulphates, may be too high.
Before the well driller and plumber disappear, nail them down as to what problems issues you may face with your new, big investment -- your water source.BP
Ken Palen is a livestock specialist with Kenpal Farm Products in Centralia.
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