Title: Distillers Grains and Livestock Production
1Distillers Grains and Livestock Production
Presented by
John D. Lawrence Iowa State University
2Benefits of Using DDGS in Swine Diets
- Often an economical partial replacement for
- corn
- soybean meal
- dicalcium phosphate
- Large supply available where hogs are produced
- Unique properties
- reduce P excretion in manure
- increase litter size weaned/sow
- gut health benefits
Source Shurson, U of MN
3Maximum Inclusion Rates of New Generation DDGS
in Swine Diets (Based Upon University of
Minnesota Performance Trials)
- Nursery pigs (gt 7 kg)
- Up to 25
- Grow-finish pigs
- Up to 20 (higher levels may reduce pork fat
quality) - Gestating sows
- Up to 50
- Lactating sows
- Up to 20
Assumptions no mycotoxins, formulate on a
digestible amino acid and available phosphorus
basis
Source Shurson, U of MN
4Current DDGS Feeding Practices
- Used almost exclusively in grow-finish diets
- 10 inclusion most common
- Gut health benefits frequently observed
- Up to15 to 20 inclusion
- When competitively priced
- Need to supplement with synthetic amino acids
- Limited use in sow feeds
- Perceived risk of mycotoxins
- 10 inclusion when used
- Limited use in nursery feeds
- Lower amino acid content/nutrient density vs
other ingredients - Limited formulation space in high nutrient dense
diets - 5 inclusion when used
Source Shurson, U of MN
5Challenges or Concerns
- Must be golden brown
- Dark brown is over heated and ties up lysine
- Flow ability
- Pellet quality
- Another bin for storage
- Abrupt changes may put pigs off feed
6Estimated Feed Cost per Head Wean-Finish, No DDGS
SBM /T 1.50 2.00 2.50 3.00 3.50 4.00
150 40.80 45.65 50.50 55.35 60.20 65.05
175 42.18 47.03 51.88 56.73 61.58 66.43
200 43.55 48.40 53.25 58.10 62.95 67.80
225 44.93 49.78 54.63 59.48 64.33 69.18
250 46.30 51.15 56.00 60.85 65.70 70.55
275 47.68 52.53 57.38 62.23 67.08 71.93
300 49.05 53.90 58.75 63.60 68.45 73.30
Corn Price
9.7 Bushels of corn, 110 pounds of 48 SBM,
18/head other costs
7Estimated Feed Cost per Head Wean-Finish at
200/T SBM
1.50 2.00 2.50 3.00 3.50 4.00
No DDGS 43.55 48.40 53.25 58.10 62.95 67.80
10 90 43.65 48.03 52.40 56.78 61.15 65.52
10 80 43.32 47.70 52.07 56.44 60.82 65.19
10 70 42.99 47.36 51.74 56.11 60.48 64.86
20 90 43.75 47.66 51.57 55.47 59.38 63.29
20 80 43.09 47.00 50.91 54.81 58.72 62.63
20 70 42.43 46.34 50.25 54.15 58.06 61.97
Corn Prices Scenarios
DDGS rate and Price
8How Much Distillers Grains Can be Fed to Dairy
Cows?
- Recommend max. of 20 of ration DM
- - 10-13 lb/d of dried
- - 30-40 lb/d of wet
- Usually no palatability problems
- At 30 of DM
- - May decrease DMI, especially if Wet CDG
- - May feed excess protein
Source Shurson, U of MN
9Example Ration Considerations for Dairy Cattle
- Diets containing 5050 forageconcentrate
- - If equal proportions of alfalfa corn silage
- DG can replace most or all protein supplement
- - If mostly corn silage
- More DG can be fed but may need some other
protein supplement (check Lysine and P levels) - - If mostly alfalfa
- Less DG likely needed to supply diet CP
Source Shurson, U of MN
10Dairy Ration Economics
- Assuming 2.30 corn, 185 SBM, 25 corn silage,
45 alfalfa haylage, Limestone 7.25/cwt, DiCal
20/cwt, 90 DGS - Feed cost/day/cow at 3 production levels
- DGS 16,000 20,000 24,000
- 0 1.88 2.17 2.45
- 10 1.76 2.06 2.35
- 20 1.68 1.96 2.24
- 30 1.68 1.92 2.16
Source Garcia and Taylor, SDSU
11Distillers Grains in Beef Cowherd and Feedlot
Rations
John D. Lawrence, Director Iowa Beef Center
12Starch Removal Concentrates Other Nutrients
Source Dan Loy, ISU
13Energy of Wet Distillers compared to Corn
Important Fed at levels to meet protein
requirement
Source Dan Loy, ISU
14DGS and Cowherds
- High protein and energy
- Complements low quality forage such as cornstalks
very well - Dry DGS can be expensive
- Wet DGS has storage challenge
- Syrup mixed with ground stalks
15DGS and Cowherds
- Potential uses
- Fed on pasture to stretch grass
- Fed on stalks for energy and protein
- Feed TMR with tub-ground stalks
- Bag or bunker with tub-ground stalks
- Creep and weaning ration of calves
- Early weaning or stressed calves because of high
feed value of DDGS
16DGS and Cowherds
- Current projects
- Stocker cattle on grass with self-feeder
- Developing a pellet/cube with soy hulls and DDGS
to feed on pasture or stalks - Evaluating storage methods
17Feed Conversion in Three ISU Experiments where
Wet and Dry DG were compared
5 Improvement Fed at levels of 10-40 of ration.
Trenkle (1996, 1997, 2004)
Source Dan Loy, ISU
18Plains research with corn coproducts
- A recent summary by Cole et al (2006 Plains
Nutrition Conference) of research from the
Southern Plains found - As little as 10 added distillers grains reduced
performance in steam-flaked corn based rations - Milo distillers grains is similar to lower in
energy compared to corn DG - Corn gluten feed is popular and successful in
these rations
Source Dan Loy, ISU
19Effect of level of feeding on energy value of
Distillers grains
Feeding Value (of Corn) 0 50 100 150
Based Research at Midwest Universities Almost 1
decrease in energy value fore each 1 increase in
inclusion level (Nebraska analysis)
Source Dan Loy, ISU
20Evaluation of a low protein, high bran coproduct
of ethanol production
0 DBRAN 15 DBRAN 30 DBRAN 45 DBRAN 30 DDGS
DMI 25.1 26.8 27.1 26.9 26.3
ADG 3.76 4.02 4.10 4.27 4.01
F/G 6.74 6.72 6.68 6.37 6.62
Calculated NE ( of corn -- 98 101 108 102
Nebraska (2006)Dakota Bran Cake
Source Dan Loy, ISU
21Challenges
- Storage and handling is more costly
- High levels of feeding management is required
- Bunk management and mixing
- Nutrient balances
- Nutrient (manure) management is more costly
Source Dan Loy, ISU
22Summary of Important Facts about Ethanol
Coproducts
- Distillers grains are superior nutritionally to
corn grain - Wet distillers grain are superior to dry
distillers grains - Ethanol coproducts work best in Upper Midwest
Feeding situations - High levels of distillers grains can be fed if
economics dictate - You can add value to distillers grains and still
produce high quality cattle feed - Challenges in feeding ethanol coproducts are
manageable - Economics will drive use and inclusion levels
Source Dan Loy, ISU
23Optimum Use
Assume 95 of corn price, 0.10/bushel increase
corn price, costs covered, 153 days from Vander
Pol et. al. (2006 Nebraska Research Report)
Source Dan Loy, ISU
24Optimum Use
Assume 75 of corn price, 0.10/bushel increase
corn price, costs covered, 153 days (Calculated
from 2006 U. of Nebraska Analysis)
Source Dan Loy, ISU
25What we need to know about ethanol coproducts
- How much can we feed?
- How different are the nutritional properties of
specific coproducts (low oil, low protein,
modified moisture, mixtures) - Are there feed combinations that work best?
- Can variation in some nutrients be reduced?
Source Dan Loy, ISU
26Iowa Was 1 in Beef
- 1968-1972 1 in fed cattle marketing
- Over 4 million fed cattle per year
- 18 of the US total
- The world changed
- Technology
- Economies of scale
- Irrigation
- Clean Water Act
- Emphasis on lean beef
- Falling consumer demand
- Currently 1.5 million marketings
27World Changing Again
- Rising beef demand
- Up more than 20 since 1998
- Emphasis on quality grades
- Choice-Select spread 2x in 15 years
- Movement from commodity to products
- Predictability, traceability, and integrity
- Cost structure shift
- Coproduct surplus
- Higher energy prices
28Estimated Returns to Feeding Yearling Steers in
Iowa, 1996-2005 (/head)
Average 28.54/head
19.97 20
62 of months positive
30 ROE
29Fed Cattle Price by State
Average Fed Cattle Prices, 1994-2003
Average Months price above Iowa
Texas 68.73 60
Colorado 68.71 62
Kansas 68.71 57
Nebraska 68.43 50
Iowa 68.52
30Iowas Cattle Statistics
31Feedlot Closeouts by Region
Source Land O Lakes, Beef Feed What Can We
Learn
32(No Transcript)
332004-06 Benchmark Close-outs
Region Sex Lots Head Carcasses
Central Plains Heifers 18,032 2,458,299 1,069,072
Central Plains Steers 18,759 2,565,051 940,443
High Plains Heifers 19,804 2,775,852 1,230,974
High Plains Steers 27,555 4,226,520 2,044,097
Midwest Heifers 2,341 340,290 65,189
Midwest Steers 5,437 805,458 131,572
North Plains Heifers 7,043 1,401,223 501,359
North Plains Steers 7,375 1,471,460 541,771
342004-06 Benchmark Close-outs
In wt Out wt DOF ADFI ADG F/G
CP H 692 1,150 156 18.8 2.92 6.52
CP S 753 1,268 157 20.3 3.26 6.31
HP H 652 1,132 178 17.9 2.68 6.72
HP S 705 1,250 180 19.1 3.02 6.38
Mid H 751 1,205 158 21.3 2.85 7.56
Mid S 792 1,320 165 22.3 3.18 7.10
NP H 717 1,199 162 20.5 2.98 6.93
NP S 768 1,305 164 21.4 3.28 6.58
352004-06 Benchmark Close-outs
COG VM Death loss HCW DP
CP H 0.58 15.02 1.63 741 63.9
CP S 0.55 13.85 1.51 811 63.8
HP H 0.60 15.40 1.77 728 64.0
HP S 0.56 13.27 1.62 801 63.9
Mid H 0.55 13.12 1.30 763 63.4
Mid S 0.51 13.28 1.29 836 63.7
NP H 0.55 14.47 1.21 754 63.5
NP S 0.52 13.82 1.29 816 63.5
362004-06 Benchmark Close-outs
Pr CAB Ch YG4 YG5 Hvy Lt
CP H 1.3 7.7 51.3 8.5 1.0 0.6 1.6
CP S 0.5 5.4 41.6 5.7 0.6 4.6 0.5
HP H 1.3 4.7 51.8 6.0 0.9 0.6 1.9
HP S 0.6 3.2 42.3 4.0 0.4 4.3 0.7
Mid H 3.2 10.5 63.5 10.4 1.4 2.0 0.8
Mid S 1.4 8.3 56.0 8.5 0.9 9.9 0.2
NP H 1.5 10.5 57.2 9.4 0.9 1.4 0.7
NP S 0.7 8.6 49.2 5.7 0.3 5.9 0.4
37The World has Changed, but What is Really
Different?
- Iowa has always been a low feed cost region
- There are no new packers in Iowa
- Water issues in High Plains
- Large professional feedlots are established in
other regions and have customer base - Iowa has new feedlot permitting rules
38Matching Cattle to Coproduct
- Plant capacity 45 million gallon
- Gallons/Bu 2.65
- DGS/Bu DM 17 85
- DGS T/day year 395 144,340
- Employees at plant 30-35
- DM /day 20
- Percent of diet 15 30 40
- Head per day 224,089 112,044 84,033
- Employees 124 62 47
39Why Iowa, Why Now?
- Is Iowa competitive in cattle feeding?
- What is YOUR business model and how will YOU beat
out the competition? - The existing businesses wont roll over
- How will you bid cattle away from them?
- How will you attract AND KEEP customers
40Alternative Models
- Farmer feeder expansion
- Leverage existing resources and skills
- Low interest loans to upgrade and expand AFO
- What comes first crops or cattle?
- Large enough for a specialist?
- Hire professionals where needed
41Alternative Models
- Keep full agreement to encourage expansion
- Plant owns or partners on cattle in locally owned
feedlots - Guarantees X head days a year to help producer
secure financing to expand - Feedlot guarantees a market for co-products
42Alternative Models
- Centralized capital/cattle management
- Commercial feeding and professional services
- Professional management and marketing
- Multiple feedyards, existing or new
- Central company may be owned by feedlots, ethanol
plant, local investors, or independent - May own cattle as well as manage
- Provide a method for local investment in cattle
43Alternative Models
- Centralized feedlot
- Investor owned feedlot
- Large scale (at least by Iowa standards)
- Cattle may or may not be owned by company
44Am I Competitive Feeding Cattle in Iowa?
- Ethanol expansion has changed economics
- Iowas low cost of gain advantage grows
- Corn prices are expected to be higher in the
future, but cost of gain cheaper - Cheap gain is an opportunity not a guarantee
- How will you capture the opportunity?
- What resources and assistance do you need?
45Summary
- Hogs impact depends on price of DDGS relative to
corn and SBM - Dairy likely benefit from DGS and can use wet or
dry - Beef feedlot clearly benefits from WDGS
- Cowherds Competition for pasture from corn, more
stalks available, and DGS can help lower feed cost
46Thank you!
- Any Questions?
- www.econ.iastate.edu/faculty/lawrence/