Few people are better positioned to comment on progress in management efficiency and productivity improvement across the Australian feedlot industry than top US feedlot nutritionist, Gary Holcomb.
Mr Holcomb has visited Australia countless times since his first visit in 1990, when he spent three years here setting up and running the Australian division of feedlot consultancy Nutrition Service Associates.
Based out of Hereford Texas, he has spent close to 30 years servicing feed yards from the Texas panhandle all the way to California.
He completed an Australian speaking tour on Friday, where he addressed NSA’s feedlot seminars in Wagga Wagga and Dalby on the subject, “Top five nutrition factors to increase profitability.”
Many of the conclusions he drew were based on a survey of NSA’s US feedlot clients, mostly across custom feedlots across southern regions.
Here is a snapshot of his key messages to Australian lotfeeders:
1. Ensuring consistency in the balanced diet.
“Let’s ensure that the diet remains completely balanced for all nutrients – energy, proteins, macro, micro-nutrients, vitamins – the entire gamut,” Mr Holcomb told stakeholders.
With the growing number of ration ingredients including by-products now used in many feedlots it was important to address the ration for balance on ‘every visit,’ he said.
“In years past, many US feedlots averaged four to six feedstuffs in a finished ration. Today, it’s not uncommon for that number to be eight – so some have doubled the number of ingredients used, and some are used on a seasonal basis,” he said.
These ranged from distillers grains, wheat by-products, corn gluten feed, cottonseed and a host of others.
The same was starting to happen in Australia, only not yet to the same extent. While the use of by-products as ration ingredients in Australia is nowhere near as prevalent as it now is in the US, the balance issue may not be as critical, however the use of novel feedstuffs is expanding.
Commodities like grape mark, wet distillers grains and citrus pulp are now regular inclusions in regional feedlot rations in Australia.
“What that means is that nutritionists have had to work harder in the past five years than they ever did before. We used to be able to calculate the basic nutrient composition in a ration with a sheet of paper and a pencil. Now because of the wider range of feedstuffs and by-products used and more shifts from one to another, we’re having to use a computer program to balance a ration – and use it every day.”
The changes and fluctuations in commodity prices was another factor.
Mr Holcomb urged lotfeeders to regularly grab their yard sheet, go out into the yard, and based on consumption (say, 11kg/head/day) determine how many mega-calories were contained in that rate of intake, and whether that was in line with expectations.
“If the cattle are consuming at 11kg a day, how much soluble nitrogen is in that ration, how much by-pass protein, is in there – particularly if they are changing feedstuffs, is the phosphorus level too high, is the ratio correct?”
Mr Holcomb suggested that over time, the ‘core function’ of some nutritionists had tended to broaden into general management advice to clients.
“To some extent, we have witnessed a change in role, both in the US and Australia, for the consulting nutritionist into a management consultant, looking at costs, equipment and a host of other factors. We accept that, but it is also important to come back to basics, and our first job is to ensure that that ration is balanced, and remains that way.”
The other focus, particularly in the Australian application, was that if a lotfeeder client wanted to gain 2kg a day on a certain mob of cattle, that the ration was capable of delivering it.
2. Managing feed efficiency.
While the variables associated with managing cattle for feed efficiency could occupy a three-day workshop on their own, Mr Holcomb listed several key factors – moisture control at the mill, moisture control at the bunk, and bunk management.
Quality assurance was also important. If a feedlot was buying lucerne hay with a relative feed value of 180, making sure that that was its actual relative feed value was important.
Mr Holcomb noted the strong adoption of steam-flaking that had taken place in Australian over the past five to ten years, compared with earlier times. There was a risk in a custom feeding client looking solely at feed efficiency, rather than also considering cost of gain, he said.
The cost of running a flaker in Australia was ‘way higher’ than it was in the US, which as grain prices became lower, could create the dilemma: when do I shut off the flaker?
3. Fixed versus variable diet energies.
Up to five years ago, a typical US feedlot simply set a requirement for diet energy, say 65 units. Now more feedlots are exploring the possibilities of using cheaper by-products like corn gluten feed and feeding an energy level of 63 units, but letting cattle eat more. In some cases this may produce a cheaper cost of gain.
In regions of the US like Texas, as well as in Australia, lotfeeders were still chasing the best conversions, but in more northern areas of the US, where distillers grains are more widely available, while conversions are not as good, they are producing a US10-12c/lb cost of gain advantage.
Obviously accessibility to by-products would influence such decisions in Australia but were worth considering, Mr Holcomb said.
4. Implant strategies.
Mr Holcomb and fellow seminar speaker Dr Kelly Bruns from South Dakota State University, outlined how a typical US feedyard now rates an animal at induction on a ten-point process.
“Any particular US feedyard might now have a range of six different implants from two or three different companies at their disposal. It’s far from a one size fits all process. It is defined by a range of factors including frame-score, age, sex and maturity pattern,” he said.
Dr Bruns outlined results from some of his recent research that defined that marbling, as a tissue, develops separately from exterior or inter-muscular fat tissue, and that that development is linear in nature.
“It is a tissue that develops right throughout the animal’s feeding phase,” he said.
“That means management on the front end – whether an animal gets sick, is not stepped-up correctly on its diet, or ends up with a metabolic issue like not getting enough calories in their system, then consequently marbling is reduced,” he said.
The common earlier belief was that marbling was a late-developing tissue, meaning simply that the longer they spent in the feedlot, the more marbling was produced, but Dr Bruns’ work has shown that management factors earlier in the animal’s life can have a large impact on later marbling performance.
As a result, there has been a shift to lower potency implants earlier in the finishing phase, followed by higher potency terminal implants. That was not the case 10 years ago, and there had been a greater development of moderate potency implants as a result.
Dr Bruns said the proportion of US carcases grading USDA Choice had risen from over the past 5-6 years from 55pc to 64pc, and higher in some regions. USDA Prime had risen from 1.5pc to 3pc.
“We’ve made a dramatic shift over the past five years to having a greater number of cattle grading Choice or better. That is a combination of management, better nutrition and genetics,” he said.
“As a general rule, the industry is doing a better job of management and understanding that marbling development, and matching implants accordingly.”
5. Metabolic health.
While statistics in Australia are lower, current mortality rate in steers in the US feedlot industry is 1.15pc, and in heifers, 1.23pc. The cost of that works out at $19.20/head, and in some cases can approach $35/head.
The ongoing challenge is in the small average herd size in the US, around 25 head, intermingling, the influence of sales barns and other factors that can heighten respiratory issues. Pre-vaccination has been promoted so long in the US it is now widely used, and preventative treatment for BVD and respiratory problems out of certain regions like Central Texas, Louisiana, Alabama or Florida, are more than likely to be treated.
However there was a discussion taking place in the US at present questioning whether the pre-vaccination data truly reflected what is happening.
Mr Holcomb said since he first visited Australia 20 years ago, our feedlot operators’ approach to animal health was much improved.
“Because of the transport distances involved, the amount of pre-sorting going on and other issues, there is more potential stressors being applied to the animal, yet animal morbidity and mortality levels do not reflect that. So Australian lot operators are doing a lot right in their health programs.”
So what is the potential improvement in adopting or applying more closely some of these five factors on profitability?
Dr Holcomb used figures from a California lotfeeder who began defining and measuring performance, whose improvement in feed conversion was 7.7pc. At 15c/kg, a feed conversion improvement of that order was worth a lot of money to the operator.
“To a large extent, the big changes have already been made in these areas, in both the US and Australia. Today it is more about refinement,” he said.
Mr Holcomb said Australia was ‘way ahead’ of the US industry, on an average basis, and quality of personnel had a lot to do with that.
“Take your best guy and our best guy, and there is no real difference between them,” he said.
“But your bottom guys are far better than those seen in the typical US industry.”
Labour/staff retention issues
He noted the difference between the labour and recruitment/retention pressures in Australia and the US industries. The US employee base was very consistent, and a lot have been in the same job for 15 years or more. Most were from Mexico, are paid little above the minimum wage, but enjoy their work.
“In the north their might be a little greater turnover, but nothing like the pressures being seen in Australia, with the competition for labour from the mining industry,” he said.
Making his first visit to Australia as part of the NSA seminars, Dr Kelly Bruns said of the issues he had seen in the Australian feedlot industry, labour access was one of the biggest.
“Among the feedlots I visited, everybody seemed to be a staffmember or two short, and the common issue seemed to be the attraction of mining,” he said.
“It’s not only at the feedlot level that that impact is likely to be seen, It will also be present at the sales and industry service level as well, right down the chain.”
Dr Bruns said he could not help but be impressed with the Australian industry’s approach to animal welfare issues.
“The development and adoption of heat stress management systems is very good, and potential heat stress episodes appear to be controlled very well. Much of (Australian) Dr John Gaughan’s work on heat stress is now used as a tool in the US industry,” he said.
“The indexes now used in the US are all derived from Australian work.”
The recent extreme heatwave across the US saw 2000 head lost in South Dakota in a three-day heat-stress event, with temperatures close to 40c, high humidity and no wind.
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